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Buying health and life insurance after divorce

A divorce in Texas can lead to various insurance-related issues. If a spouse has health coverage under a spouse's employer-based plan, for example, they might need to look into getting a new policy. COBRA allows a three-year continuation of the employer's plan, but this is still temporary.

Under COBRA, the individual must pay the employer's share of the policy along with administrative fees. This could make continuing the plan quite expensive. Ex-spouses without other options may be better off getting a plan through the Affordable Care Act, which prevents denying coverage due to preexisting conditions.

Life insurance is the other major insurance issue that should be addressed in a divorce. The primary purpose of a life insurance plan after a divorce is to protect the alimony recipient if the spouse who pays support dies. A life insurance plan may be a condition of the divorce settlement. Some recipient spouses may prefer to pay the premiums on the plan so they can be certain it does not lapse. All life insurance arrangements should be made before the divorce agreement is final. The spouse might be uninsurable, and if this is the case, there could be other ways to address the issue.

A high-asset divorce may have a number of financial complications. If the couple does not have a prenuptial agreement, each partner will be entitled to an equal share of the marital assets. This may include the appreciation value of assets that were brought into the marriage. Divorcing couples may want to reach an agreement in which each partner takes certain assets instead of splitting all the assets 50/50. An attorney could help with this property division process.

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