Divorce and separation is hard. But, regardless of how you feel emotionally, there is a laundry list of professionals you need to contact when you separate from your spouse. People often forget but your insurance broker is one person you want to notify asap so you don’t run into any insurance issues down the road. Here are a few things that are important to consider about your insurance when going through a separation or divorce.
Know who is paying your premiums
Like anything in divorce or separation most people don’t want to be connected to their ex, especially with something as sensitive as money. Payment of house insurance premiums can become an issue if the party who is responsible for those payments is not living in the house anymore and decides to stop the paying for the insurance. You could be without insurance and not even know it!
Also, you always need to maintain a proper risk address to ensure insurance renewal notices, or the pink slips you get for your car insurance are being sent to the right place.
Changing the names on your policy
Things get even more complicated if something happens to your home and both names are still on the policy. If this is the case payments will be issued naming both parties and one person cannot cash the insurance cheque without the other’s consent. This can be a dangerous game, especially if the divorce is not amicable. Insurance money can come into play as bargaining chips in a divorce if there is suddenly a large sum of money on the table. To change a policy into one name an insurance broker will need the deed to the property that indicates that it is now owned by one person. Doing this will ensure that any insurance payments will be payed to the person who owns the home and not the person who no longer has stake in the property.
If separation and not divorce is on the table or the divorce is expected to be a long drawn out process it is still important to let your insurance broker know as soon as you establish separate homesteads. There are certain provisions that can be made on an insurance policy that makes the person living in the home able to collect any claims payout independently. If the other spouse is renting elsewhere an insurance broker can also help them get set up with tenant’s insurance, which often gets overlooked.
An empty house has less coverage
If the couple getting divorced decides to sell the house and the property becomes vacant, that is also something that needs to be reported. If the house is standing empty the coverage reduces because the risk is higher if no one is there to keep an eye on things. In many cases it is beneficial from an insurance perspective for one party to stay in the house until it is sold. That way you are still covered for everything your original policy dictates.
Divorce is hard enough as it is without having to worry about your home or auto insurance on top of it. As long as you keep your insurance provider in the loop they will be able to facilitate a smooth transition when it comes to your insurance and let you know all your options moving forward.