Why Your Spouse Is Not Your Insurance Policy

When discussing disability insurance, we often hear people say, “Oh I’m not worried. My partner has a job, so I’ll be covered, and my family will be fine if anything happens to me.”

This response is totally understandable. After all, depending on your spouse can and should be considered healthy within a relationship. Sharing responsibilities, being vulnerable, and supporting one another are all positive examples of healthy dependence within a marriage.

However, when it comes to disability and life insurance, total dependence can actually be harmful to you and your family.

Here’s why:

Getting a Divorce

First, let’s dive into the least morbid of the potential outcomes: divorce.

Thankfully, the divorce rate in the U.S. has been in decline. We’re at a 40-year low, and the numbers are even lower with an increase in education levels. While this is excellent news, the reality is that divorce still happens and is the best solution for many couples. In fact, we receive three to four calls a week from clients going through the divorce process.

If not properly covered, the loss of a spouse from divorce could leave you or your family inadequately prepared after your disability. You may end up in the position of sole breadwinner. Simply put, this means that if something unfortunate were to happen to you, your dependents and those caring for them would be reliant on whatever financial arrangements you made in preparation. If not properly covered, loss of a spouse from divorce could leave your family inadequately prepared after your disability. You need to take care of yourself and your dependents.

Disability insurance policies can be confusing, and divorcing your spouse can lead to even more confusion and questions. It could all be one huge mess. And the results of that mess have one major component: It costs you more money.

I can’t emphasize enough how important it is to have disability insurance that is tailored to the unique needs of you and your family. When there is a change in your family life, there are adjustments in store for your disability and life insurance policies, too. So while you may not have to deal with the in-laws anymore, you ought to be prepared to deal with securing proper coverage.

A good disability insurance policy shouldn’t only cover your fixed expenses but also include additional monies for possible unforeseen expenses. There will certainly be costs you never considered after a potential illness or injury. In the case of divorce, there is the hope you would have assistance through alimony and/or child support. However, if you are the holder of the higher income, you may be the one responsible for alimony. Also, don’t forget about the lawyer fees that add up throughout the divorce process.

Securing the right disability insurance may be challenging, but you can avoid or remedy recurring roadblocks to getting the best coverage. Head over to our post to learn about what tends to cause hiccups in getting complete policies.

Becoming a Widow(er)

Next, let’s talk about the possibility that most people avoid talking about: the chance of becoming a young widow or widower.

This conversation is a part of “adulting” that induces angst, but the truth of the matter is that someday the sun will set for each and every one of us. It’s normal that when thinking of a widow or widower, you might picture a seasoned individual in the eighth or ninth decade of their lives. However, according to the U.S. Census Bureau’s records, a more accurate snapshot of the average person becoming part of this demographic is 59 years old.

All in all, nearly 23 million people in America are widows or widowers. The Centers for Disease Control and Prevention points to cancer, heart disease, and accidents as the leading causes of death for people between the ages of 35 and 54.

While no one looks forward to the day their spouse will pass, it pays to prepare for the possibility. Be intentional about setting up a policy that meets the needs of you and your family.

In terms of life insurance, your policy should be enough to pay off any anticipated mortgage, childcare costs, and future education costs.

There are ways to “ladder” term policies to tailor the amount of coverage to the various stages of life, but most don’t know how to go about that. This may sound complex, but our advisors can walk you through the details.

While a tax-free benefit from a term life policy won’t answer all the financial issues that might arise from becoming a young widow or widower, being properly funded can make finding solutions far easier.

The Sum of It All

I hope that you never have to face an unfortunate divorce, leading to becoming uninsured; or the surprising passing of your spouse, creating unforeseen expenses that you probably can’t afford.

While both of these are things that many people face in their lifetimes, the good thing is that the financial hardship that might result from these outcomes are easily avoidable with one simple thing: protecting yourself with the right disability and/or life insurance.

We have plenty of information to help you get started. We offer personalized consultations for one-on-one support, in addition to our 101 guides on disability and life insurance, and our blog section diving into particular topics.

No matter where you are in your journey, we help ensure you and your family are properly protected from the unforeseen. Just take it from our clients.