Life insurance after divorce

If you and your ex-partner have individual life insurance, you may not need to make any big changes. 

You should still check you have the right cover once the costs and financial impacts of your divorce are clear. This is even more important if you have children.

If your life insurance is set up to benefit your ex-partner, you may want to change this. It’s worth bearing in mind there may be other legal considerations, such as special provisions in your will, that could need changing too. And if you’re separated rather than divorced, your spouse may still receive a payout from your cover if you die.

We offer separation benefits under our standard joint life insurance terms. This gives you the option of splitting your cover into two individual plans if you separate or rearrange your mortgage into one name. 

To make this process as straight forward as possible, we won’t make you answer any extra medical questions. 

If your relationship ends, your insurer may be able to separate your joint cover, or it might be possible for one person to take it on. If that’s not an option, you can take out a new policy to continue your cover. Make sure you check what your insurance provider offers.

You can put your life insurance in trust if you want to choose who will benefit from a payout. It allows you to name specific people as beneficiaries, such as your children, other family members or even friends.  You can change them at any time by completing and sending an Expression of Wishes form to the trustees of your policy.

A change in circumstances, like going through a divorce, will likely mean a change in living arrangements. If one person decides to stay in the same house, they may choose to take over the whole mortgage. That could be a time to review any existing life insurance taken out mainly as mortgage protection – or any cover that’s changed, for example after the separation of a joint policy – to make sure it still meets their needs. 

However, if a couple decides to sell their home, they might choose to cancel their cover and explore what options are available based on their new circumstances.

Many factors can impact the financial effects of a divorce, such as age, health and employment. If you feel uncomfortable or unsure about any decisions, it can help to speak to an independent financial adviser to talk through your options.