Introduction

Life insurance is often discussed during divorce proceedings as a way to help support ongoing financial obligations. In some situations, one spouse may request that the other maintain coverage, or that a policy be structured with a specific beneficiary and ownership arrangement.

These situations can include child support, spousal support, or other negotiated terms within a marital settlement agreement. The structure of the policy, including ownership and beneficiary designations, should align with the written court order or agreement.

Can One Spouse Have a Policy on the Other?

In certain cases, a life insurance policy may be structured so that one spouse is the owner and/or beneficiary of a policy on the other spouse.

This type of arrangement may be considered when:

Financial support obligations exist

Coverage is intended to secure child support or alimony

Terms are defined within a divorce settlement or court order

However, these arrangements are not automatic and must meet insurance and legal requirements.

Insurable Interest and Consent

Life insurance policies generally require an insurable interest at the time the policy is issued. In divorce situations, this may be supported by financial obligations such as court-ordered support.

Depending on the circumstances:

The insured individual may need to provide consent

The insurance carrier may have specific underwriting requirements

Documentation may be required to support the purpose of coverage

Each situation can vary based on the facts of the case and the carrier guidelines.

Common Structures Used in Divorce Cases

Some commonly used structures may include:

One or both spouses maintains a new or existing policy with the other named as beneficiary

A new policy is obtained to meet court-ordered support requirements

Ownership and beneficiary designations are structured according to the settlement agreement

Coverage is maintained for a defined period tied to support obligations

The exact structure depends on the language of the court order and the available insurance options.

Important Limitations to Consider

It is important to understand that not all arrangements are available in every situation. For example:

Not all insurance carriers allow one individual to own a policy on another without proper consent

Employer-provided group life insurance may not meet court-ordered requirements

Policy ownership and beneficiary designations must be clearly defined

Coverage amounts and duration must align with the court order

Key Consideration

The issue is not only coverage—it is how the policy is structured.

Florida Divorce and Court-Ordered Life Insurance

In Florida, life insurance may be addressed as part of a divorce settlement or court order.

In some cases:

Life insurance may be negotiated between parties

A court may order coverage as part of support obligations

The agreement may specify ownership, beneficiary designation, and duration

Proper documentation is important to ensure the coverage aligns with the terms of the order.

Beneficiary Considerations for Minor Children

Naming minor children directly as beneficiaries can create administrative challenges, as minors are not able to directly receive or manage policy proceeds.

In some cases, a trust or other legal arrangement may be used to manage funds for the benefit of minor children. The appropriate structure is typically determined within the legal planning process.

Policy Review and Documentation

Policy review is conducted directly with the insurance carrier, typically through a three-way call with the policy owner and the carrier.

During this process, the following is verified: