When two people get divorced in Texas, there are a lot of changes that occur. One of the most important things to consider is the potential implications it might have on your life insurance policy. Therefore, let’s discuss how a divorce can impact your coverage and what steps you need to take to ensure that you and your loved ones are protected.
What happens to your life insurance policy upon divorce?
Texas is a community state. Therefore, upon marriage dissolution, your spouse will get half of the marital property, and that includes your life insurance. The court will determine its cash value, then split it 50/50 to your spouse if you named them the primary beneficiary. The circumstances change if you name your kids.
Reasons to have life insurance
One of the most important reasons to have life insurance in a Texas divorce is to ensure that your children are taken care of financially if something happens to you. If you are the primary breadwinner in the family, it is especially important to have life insurance so that your spouse can continue to provide for your children.
Another reason to have life insurance in a Texas divorce is that it can help protect your assets. If something happens to you and you don’t have life insurance, your spouse may end up having to pay out of pocket for all of your funeral expenses. This can be very costly and may deplete your assets. Having life insurance can help prevent this from happening.
How much coverage do you need? This depends on a number of factors, including your income and the size of your family. Generally, you will want to have enough coverage to provide for your loved ones in the event of your death. Speak with an insurance agent to get a better idea of how much coverage you need.
Having life insurance in Texas divorce is important for ensuring that both parties are protected financially. You may need to change the beneficiary on your policy or cancel it altogether. Find a policy that protects your assets and your children or your ex-spouse (if you like) and stick with it.