Can You Get Divorce Insurance?

Nine out of 10 people marry by the time they hit 50, but around one in two get divorced at some point, as well. The idea of divorce insurance, then, makes sense. If you have the option of financial protection against a likely event, then, you might be receptive to it.

When you look for divorce insurance to buy, you may have a hard time identifying an actual product. It wasn't until the year 2010 that such a product really existed. It was called WedLock, and it was sold by SafeGuard Corp. To be covered by WedLock, you paid a premium worth $16 for a unit of coverage worth $1,250. If you bought five units for $80 a month, you would be covered for $6,250. When you showed the company proof of your divorce, they would pay you the sum you were covered for, plus an additional $250 per unit for every year you stayed with them. You couldn't buy WedLock just when you were planning divorce, however. You needed to keep buying the insurance for at least four years for the policy to pay out upon your divorce.

WedLock was discontinued before long. Today, if you wish to cover yourself against the risk of financial losses as a result of divorce, you don't have a tailor-made product. Instead, you could form a patchwork of coverage.

If you seek protection with a divorce policy, you would expect it to pay for the legal costs of a divorce, and make up for the financial losses of divorce. If a single insurance policy doesn't pay for all this, you could fashion coverage out of the following services:

• Legal insurance: A legal insurance policy offers you a certain amount of legal advice when you file for divorce. Some offer legal representation in court. Coverage differs widely among different insurance products. Some only cover uncontested divorces, and others cover all divorces.
• Lawyer discount plans: Different lawyer networks offer discounted lawyer access. Before you sign up for full price representation by a lawyer, you might look into legal discount plans.

The MSAI product helps protect you against the possibility of being unable to pay child support and spousal support after a divorce, if you lose your job. MSAI payments go directly to the recipients of spousal support or child support, and only come into effect when unemployment benefits are paid to the insurance buyer.

The easiest way to protect yourself against the steep costs of divorce is to draw up a prenup before you get married. A prenup cannot cover all your problems in the event of a divorce: it cannot help you determine who gets custody of your child, or what kind of child support should be paid. It does help you work out going in how to divide up your assets, however. If you've already entered marriage without a prenup, but you're still on good terms with your spouse, you could even have a postnup drawn up. A postnup can address all the points that prenups are usually known for, but can do it after the wedding. Either one of these agreements can help make sure that you are financially protected in a divorce.

Some people also self-insure against potential divorce -- they put money away in savings each month to help cover them should divorce occur. This would be a simple form of divorce insurance, and if you don't get divorced, you get to keep the money. If you have questions about filing for a divorce in New Jersey, call 201-845-7400 for a free consultation.