When most Florida couples are ending their marriages, they primarily concentrate on the immediate issues at hand such as dividing property, figuring out child custody and determining spousal and child support. Far too few people think about how their divorces might impact their estate plans.
A divorce property settlement will outline the obligations eachparty holds to the other. In many divorces involving children, these agreements will include provisions that one party will provide life insurance for the benefit of his or her children to cover the contingency that the payer of child support dies prematurely. Normally, these agreements will terminate when the children reach the age of 18.
When the insured dies before the children reach the age of majority, a potential unintended result will be the former spouse receiving the proceeds of the life insurance policies instead of the proceeds going to the children. The former spouse may then end up spending the money however he or she wishes despite the decedent’s wishes to the contrary. Some people establish irrevocable life insurance trusts as the named beneficiaries to their life insurance policies. By doing so, people may be able to make certain the funds go to the children for whom the proceeds are intended.
The end of a marriage can have a wide-ranging effect on other types of estate planning documents as well. As an example, a spouse may have been named as an executor under the other spouse’s will. In most cases the testator will want this changed. An attorney can review all of the components of a divorcing client’s existing estate plan to see what other changes will be necessary or desirable.