What will happen to my Spouse Rider on my life insurance policy after I get divorced?
UPDATED: May 5, 2014
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Asked May 5, 2014
A divorce brings a lot of changes to your life. Bills have to be adjusted to reflect your new single status, addresses have to be changed, and financial contracts such as insurance policies have to be modified. In life insurance, these changes include dropping beneficiaries or even changing the type of policy you own.
When you get divorced, there is no reason to continue paying for life insurance on someone who is no longer a part of your life. Since the spouse coverage was a rider on your policy rather than being part of it, such as in a "Last Survivor" policy, removing him or her from the coverage is fairly simple. Contact your life insurance company and notify them of the change in your marital status, and they will guide you through the process of having the spouse rider removed.
Removing the spouse rider will result in lower premiums on one hand, but could cause an increase on the other. You will not have to pay coverage on your spouse, but you will also lose the discount associated with being married. In most cases, the premiums you pay will not change much, and you will usually see a reduction, albeit a small one.
While you are having the spouse rider removed, take advantage of the opportunity to review the policy to make sure that it is up to date and sufficient for your needs. This includes verifying the beneficiaries listed on the policy and checking to make sure that your insurable needs have not increased or decreased. For example, you may not wish to have your ex-spouse as a beneficiary, and your insurance needs may be lower as a result of the family splitting up. Reviewing a life insurance policy should be done periodically, but is especially important when a partnership comes to an end because it changes the factors used in determining how much insurance you should carry.
Answered May 5, 2014 by Anonymous