When couples in Illinois divorce, the court often orders one or both parents to make support payments for the living expenses, education, medical care and other basic needs of their children. Child support is designed to help couples attain the goals that they had in mind for their children before the end of the marriage.
If a couple has very young children at the time of the divorce, parents may have to make support payments for a long period of time. Rarely is anything in life ever certain, and some divorced couples are concerned about what would happen if the parent paying support were to pass away before a child reaches the age of emancipation. An Illinois child support lawyer knows that a life insurance policy can ensure that support payments continue in the case of the payer’s death.
Addressing insurance in a separation agreement
Many couples want to secure the financial support of a child and choose to do so through a life insurance policy. It may be wise to address the topic of child support obligations in a separation agreement. Parents can outline the child support obligations that they have agreed upon, and can determine how a life insurance policy will be handled if funds are needed to continue support after a death. An Illinois child support lawyer understands that a well-drafted separation agreement should include a life insurance provision.
Naming a beneficiary
There are several options for naming a beneficiary on a life insurance policy after a divorce. Each has pros and cons, and divorced couples should consider their unique circumstances when deciding which is the best option for their family. Typically, the three options for a beneficiary are the following:
- Naming the child or children as the beneficiary
- Naming a custodian as the beneficiary
- Naming the ex-spouse as the beneficiary
By naming a child as the beneficiary of a life insurance policy, the policy proceeds are awarded to the child at age 18. An Illinois child support lawyer could suggest that this may or may not be the best option, depending on the maturity of the child. When a custodian is named as the beneficiary, the property can be held until a child is 21 or can be designated to be used only for college expenses. Some people choose to name their ex-spouse as the beneficiary, designating the use of the funds for child support only and placing the surviving spouse under a moral obligation to use the proceeds as outlined in a separation agreement.
Providing financial support for their children is often a big concern for divorcing parents. With a life insurance policy, there may be peace of mind knowing that a couple’s children would be cared for in the event of a parent’s death.
