Wife and husband signing divorce documents or premarital agreement

A divorce is a lifechanging event, one that affects a myriad of financial and life situations. Insurance coverage is one critical aspect that must be properly addressed after a divorce. Divorcing spouses should know how long an ex can stay on an insurance plan once divorce proceedings are finalized.

1. Health InsuranceWife and husband signing divorce documents or premarital agreement

The majority of Americans receive health insurance through an employer. If a spouse has coverage through an employer, once the divorce is finalized, the other spouse will no longer receive benefits. The spouse who is no longer covered will still be temporarily eligible for COBRA benefits.

COBRA insurance is named after the federal Consolidated Omnibus Budget Reconciliation Act. An ex-spouse who loses coverage due to a lifechanging event, like divorce, may pay for COBRA coverage for up to 36 months. COBRA policies are expensive, but far less than paying out of pocket for medical expenses.

Another option may be to sign up for health insurance through an employer if it is offered. By losing coverage through a lifechanging event, including divorce, applicants have the opportunity to purchase insurance outside of the established open enrollment period.

A divorcee may also choose to buy health insurance through the state’s health insurance marketplace. Medicare or Medicaid benefits may be applicable under certain circumstances. Keep in mind that federal law mandates that health insurance coverage ends as soon as the divorce is finalized.

Obtaining Medicare benefits from former spouse’s employment history

A former spouse’s employment history may allow some individuals to obtain Medicare benefits. In order to be eligible, the marriage must have lasted at least ten years; the applicant must have reached 62; the applicant must be currently unmarried; and the ex must qualify for Social Security Retirement benefits.young man in suit showing an insurance policy

Medicaid is an option for divorcees who are unable to afford health insurance premiums. A Medicaid divorce is one where a spouse offers all assets to the other during divorce proceedings, allowing the individual to then apply for Medicaid benefits without reporting assets.

Health insurance coverage may be included in divorce settlements. For example, a divorcing spouse who has been receiving health insurance coverage through the partner’s plan may request that the divorce settlement stipulate that coverage should continue for the spouse and children.

The courts are aware of the potential financial implications of health insurance coverage. In instances where an ex-spouse is unable to afford to carry insurance for the former spouse, the individual may go to court and seek a modification to the initial terms of the divorce settlement.

An ex-spouse must also pay for healthcare coverage for a child in a divorce. Generally, this obligation is in effect until the child turns 18, graduates from high school or turns 21 (if older than 18). Modifications may include providing coverage for as long as the child is in college.

2. Life Insurance

Life insurance can be as important as health insurance. For instance, a former spouse who is ordered to pay child support may experience an unexpected death. As the deceased spouse is no longer able to commit to payments, the other spouse may be left in a precarious financial position.

In order to benefit from a life insurance policy and protect child support payments, the former spouse must be named as a beneficiary. Designation is necessary, since the former spouse may no longer be named on a private or employer-offered insurance policy after a divorce.

3. Disability InsurancePersonal Injury Law

Disability insurance pays a part of a policy holder’s income in the event that the individual is no longer able to work due to an injury or illness. Becoming disabled for at least 90 days is more common than dying before retirement.

Earning divorcees are advised to purchase their own disability insurance. But those who rely on spousal or child support should seek to ensure that disability insurance is included in the divorce settlement. Ideally, divorcing spouses should plan for disability insurance before the divorce is complete.

4. Car Insurance

After a divorce, property, like vehicles, will be divided up. As a result, separate car insurance policies will be required. The auto insurer should be notified, so that the ex may be removed from the policy and the policy remains under one name.

Changing the name on the policy protects the former spouse from liability in the event the other spouse gets into a car accident and is sued. Joint custody of a teen driver requires that the teen be placed on the policies of both households, which can be a higher expense.

5. Home Insurance

Similarly, once the divorce is complete and one spouse moves out, the home insurance company should be notified. The homeowner’s insurance policy should then be solely under the homeowner’s name. The ex-spouse who moves out must buy a separate policy for the new residence.

Get Help from a Divorce Attorneyallen-gabe

Divorce proceedings can be emotionally turbulent. At the same time, spouses must protect their finances, which includes understanding the nuances of insurance, as it relates to the completion of divorce. You deserve trusted legal representation, which you will find at Allen Gabe Law, P.C.

Our team of leading family and divorce lawyers will help you navigate the complex matters of divorce. Family law includes varying types of cases, including visitation rights, child custody, domestic violence, alimony, and pre-nuptial agreements. Our divorce lawyers are skilled in all aspects of divorce.

Allen Gabe Law, P.C., divorce lawyers provide legal counsel regarding child custody agreements that will benefit your children. We can also develop a fitting visitation plan. Property divisions are handled with ease, as we identify what the law deems as marital property.

Since Illinois is an equitable distribution state, assets are divided fairly and not equitably during divorce proceedings. We are able to meet the legal needs of clients who have a high net worth. No matter what your financial circumstance, our lawyers will mediate an agreement for property division.

We understand that divorce is an emotionally trying time. When you seek experienced family law attorneys who are knowledgeable about Illinois divorce law, consult Allen Gabe Law, P.C.

Contact Us

We are dedicated to serving families in Schaumburg, IL and the surrounding communities. Give us a call at 847-241-5000, ext. 121 to schedule your initial consultation.

About 

As a specialist in divorce law, family law, litigation, real estate and business and corporate law, Allen has provided responsible legal representation for clients in a wide variety of matters for over 30 years. Allen is also a sought-after public speaker within the attorney community.

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