Life insurance is insurance against a person’s life that pays out money upon the death of the person. People typically purchase life insurance to support their family if they can no longer support their family due to death. What happens if you get divorced? You probably no longer want your spouse to benefit from your death. If you have children, you definitely want your children to be the beneficiaries of a life insurance policy. Does your spouse have to get that money to support the children? It all depends. If you already have life insurance an Illinois court has the power to decide who will be the beneficiaries of that policy. With respect to existing life insurance, provided the court is apprised through evidence, stipulation, or otherwise as to level of death benefits, premium, and other relevant data and makes findings relative thereto, the court may allocate death benefits, the right to assign death benefits, or the obligation for future premium payments between the parties as it deems just.” 750 ILCS 5/504(f)(1) In Illinois, life insurance benefits do not automatically get awarded to the ex-spouse upon the moment of divorce (this is different than most states). You have to switch the beneficiary after the divorce. However, a divorce decree can state the parties’ intent to declare a new beneficiary which will apply even if the party never got around to switching beneficiaries before death. Richard v. Martindale No. 09 CV 4159, slip op. (N.D. Ill. June 14, 2010). The law requires that life insurance automatically drop an ex-spouse as a beneficiary after an Illinois divorce. This makes Illinois an “automatic revocation” state regarding life insurance. “If a judgment of dissolution of marriage is entered after an insured has designated the insured’s spouse as a beneficiary under a life insurance policy in force at the time of entry, the designation of the insured’s former spouse as beneficiary is not effective unless: (A) the judgment designates the insured’s former spouse as the beneficiary; (B) the insured redesignates the former spouse as the beneficiary after entry of the judgment; or (C) the former spouse is designated to receive the proceeds in trust for, on behalf of, or for the benefit of a child or a dependent of either former spouse.” 750 ILCS 5/503(b-5)(2) If you’re divorced and you have an existing life insurance with your ex-spouse as the beneficiary, the alternative beneficiary will […]
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via Russell D. Knight | Family Lawyer Chicago https://rdklegal.com