If there's one outcome of divorce that's relatively straightforward, it's the legal dissolution of a marriage. Unfortunately, couples dealing with divorce quickly learn there are legal consequences that affect a lot more than just their relationship.
We're going to look at four other aspects of life your divorce can impact. It's important to note this post is simply an introduction to topics you should be thinking about during the divorce process. You should speak with an experienced divorce attorney to receive comprehensive information and guidance.
Life Insurance
How life insurance is dealt with in a divorce depends on whether the policy is term life insurance or a whole life policy. Term life insurance is not divided in divorce settlements because it has no cash surrender value. A whole life policy does have cash surrender value, however, so the court will likely order it to be divided or assigned to maintain the insurance in the divorce order.
Children also influence how life insurance is handled in divorce. If a policy is meant as security for child support, it can be terminated when the dependent child reaches the “age of majority,” which is 18 in New Hampshire. Life insurance may also be required to guarantee alimony, in which case the policyholder may be required to maintain the insurance for as long as the alimony payments are required.
The court can also make life insurance for one or both parents, with a child named as beneficiary, part of a child support obligation. The owner of the life insurance policy is the one who has the right to name beneficiaries. If there's a question of who the policy owner should be, making that designation can be part of the divorce negotiations.
Social Security
According to the IRS, it's possible to receive benefits on your ex-spouse's record—even if he or she has remarried—after divorce. There are several stipulations outlined:
- Your marriage lasted 10 years or longer
- You are unmarried
- You are age 62 or older
- Your ex-spouse is entitled to Social Security retirement or disability benefits and
- The benefit you are entitled to receive based on your own work is less than the benefit you would receive based on your ex-spouse's work
What kind of benefit can you expect? For a divorced person who meets the above requirements, the benefit is equal to one-half of your ex-spouse's full retirement amount (or disability benefit) if you start receiving benefits at your full retirement age.
Health Insurance
A 2008 New Hampshire law (RSA 415:18, VII b) allows an ex-spouse to continue coverage on the subscriber employee’s group health insurance policy for up to three years following the final divorce decree or legal separation. In this case, coverage for both medical and dental continues for the full three years or until:
- Remarriage of either the covered employee or the former spouse
- Death of the covered employee
- Such earlier time as provided in the final decree
One major caveat: the right to coverage for the ex-spouse only exists if the employee subscriber maintains the same group health insurance plan. Eligibility cannot be transferred from one employer to another. Also, self-insured employer plans are not subject to the law's continuation requirements.
Trusts
Family trusts are an extremely complex area of the law and divorce only compounds things further.
Most people expect some division of property in a divorce. New Hampshire is not a “separate property” jurisdiction, which means that all assets of the divorcing couple are subject to division, including:
- Assets acquired prior to the marriage
- Assets titled in the name of one person alone
- Assets acquired by gift or inheritance, whether owned by the inheritor or donee spouse outright or in a revocable trust
When it comes to trusts, New Hampshire judges will consider the nature of the beneficiary's interests in and powers over the trust. Do you have vested trust interests? Do you have a discretionary trust? An attorney can advise you on which type is best for the outcome you seek in the settlement.
It's understandable to feel overwhelmed when dealing with divorce. It's hard enough to work through a changing relationship, let alone all the other changes it brings to life. If you think an attorney can help, don't hesitate to contact one today.
