When people separate, should one of the separating parties immediately change the beneficiary of an insurance policy from their previous spouse, and/or cancel the policy?
April 26, 2017
The answer is “No”. If one party is paying child support for the children, he/she might want to consider keeping the insurance policy in place, with the former spouse as the beneficiary in trust for the children, even after the divorce. If something were to happen to the payor spouse, the children may be left in serious financial turmoil if the former spouse is no longer the beneficiary. Once the children becomes adult or there is no further requirement to pay child support or section 7 expenses (including post-secondary educational expenses), the payor can then choose to change the beneficiary of the insurance policy or cancel the policy.