As much as you will not really want to think about it, money is going to govern your equation with your partner in a major way. As much as it would be effectually the last thing on your mind, you should learn about divorce insurance if you are soon to tie the knot. And, today we will do just that—tell you a thing or two about divorce insurance.
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What is divorce insurance?
It is very important to clarify at the very onset that divorce insurance is not a prenuptial agreement—rather, it’s a payout which the policy holder receives once the divorce is finalized. Once the necessary fees are paid, you will not really have to worry about getting into financial ruin after divorce. A prenuptial agreement, on the other hand, documents the way in which assets will be distributed right after marriage. The divorce insurance policy, will, in no way, replace the prenuptial agreement.
Now, this particular insurance policy is yet to gain mileage in the financial market because many are still apprehensive of the financial wisdom of investing in such a policy.
Finding out a few nuances of this particular insurance policy
Though Americans, in general, are apprehensive of securing this policy, it should be pointed out that there is a high percentage of American weddings that end up in divorce. It was in the year 2014, when it had been estimated that around 44 percent of marriages ended up in divorce—and that too, most of them didn’t even last 9 years. There are many below the poverty line who file for divorce as well. What more? As per stats, divorces can even end up costing 70 percent of one’s net value.
A divorce insurance policy can be bought by the couple to save each other. Even your relative can buy the policy for you.
One of the best attributes of this particular policy is that it doesn’t discriminate between those in their first marriage and those in their second or third marriage. The unit of coverage cost is the same.
The difficulty of choice or indecision is palpable. How do you bring up the issue in front of your partner? How do you tell him/her that you are going to invest in divorce insurance while you start talking money? The key is to strike a balance between over-pragmatism and callousness. In fact, the key is to be pragmatic and discuss stats with your partner and of course, the feasibility of the policy as well.
Find out about premium rider
You should remember that there are policies that need you to be at least 4 years in wedlock in order to receive your payout. If you think four years is too long a time then you can opt for a premium rider. With the premium rider you can have 50 percent of the payout in case you’re up for legal separation. The remaining 50 percent can be claimed if you actually end up divorcing.