Securing life insurance to cover court ordered child support payments in the event of the payer’s death is important. A thoughtful calculation is necessary to ensure that the life insurance policy is robust enough to cover what might be years of support.
Life Insurance to Cover Child Support Payments
Life insurance to cover child support may be calculated using the annual amount of court ordered child support multiplied by the number of years until a child reaches the age of majority. However, many parents also share child care expenses, unreimbursed medical bills, and other miscellaneous expenses, and may even agree that the payer will cover college tuition, so these expenses should be included when determining how much life insurance coverage may be needed.
The amount of life insurance necessary to cover a payer’s obligation will decrease as a child grows older. Therefore a divorce settlement agreement often includes a provision to allow the insured to reduce the face value of the policy over time. Conversely, if a child’s need for support increases for any reason, an agreement may include a provision for the recipient to request an increase in life insurance coverage.
Can the Payer Afford Life Insurance?
Of course, life insurance coverage can be cost prohibitive depending on a payer’s health status and age. When negotiating a divorce settlement agreement that includes life insurance to cover support obligations, it cannot be unduly burdensome to one party. It may be necessary to offer other party security to cover support obligations in the event of the payer’s death. An experienced family law attorney can help you determine the best way to secure support obligations.
Contact Our Family Law Attorneys for Assistance
If you are a recipient of support or are ordered to pay child support as part of your divorce settlement, it is important to include a life insurance provision to secure support when possible. If you have questions regarding Wisconsin child support contact Probst Law Offices S.C. for immediate assistance at 414-210-3135.