Life Assurance and Divorce

[steevw]

I am currently seeking a divorce from my wife. At 67, I am 25 years older than she is and about ten years ago we took out a life assurance policy in her name and against my life. I now wish that policy to be surrendered by her as I do not want her to benefit from my death. She is refusing to do this - what are my options and who do I turn to?

 

Naturally, Skandia, with whom the policy is held, cannot deal with me directly, only my wife. I have very little money and I would like to know what my rights are before seeking legal advice.

 

Many Thanks,

Steve

[citizenB]

I have moved your thread/query to the correct forum.

 

 

Unfortunately there is nothing you CAN do about it.

 

However, who is paying the premiums ? If you, then your answer is to cease payments - the policy will then be frozen.

 

If it was with profits, it will be frozen at a set sum. If it was not with profits and for a term period only then it will have no value.

 

Does that help ?

[steevw]

Unfortunately that does not help my situation. I am the life assured, not the policyholder. I signed my agreement to that when I was married, I want to ‘un-sign’ now we are being divorced - surely I must have some rights. I find it hard to understand how a marriage contract can so easily be dissolved, but the life policy that went with it can not. There must be someone who can contest this. Any ideas would be most welcome.

 

Steve

[honeybee13]

Hello there.

 

I'm afraid I think citizenB could be right. With a life assurance policy, the issue is whether there is 'insurable interest' when the policy is taken out, which there would have been if you were married. I assume the insurance company checked this at the time, it normally would be. I think I'm right in saying that insurable interest is only important at the beginning of a policy.

 

As CB asked, who is paying the premiums? And a couple of other questions, would the life assurance be dealt with as part of the divorce normally? And what type of policy is it, I don't think you've said.

 

Have you tried speaking to or emailing the FSA helpline? They may have some knowledge of this.

 

My best, HB

[steevw]

Thanks for your help. While we were together, my wife paid the premiums by direct debit from her personal account. I am wondering if, as the policy has a surrender value, it would constitute ‘joint assets’ in a divorce as the premiums during our marriage could be considered to be joint payments.

 

The policy was taken out many years ago and I have no information about it now. I cannot say what type of policy it is, but Skandia have identified it and it is still being paid. I have emailed FSA but they take 12 working days to reply.

 

I cannot believe that I don’t have any rights in law in terms of influencing this policy. Surely she cannot benefit from my death if it is against my wishes.

 

Steve

[honeybee13]

Hello again.

 

I would have thought that a surrender value could well count as a marital asset. Of course, it could be a policy that has no surrender value like a term assurance or similar.

 

As I said I have a feeling that insurable interest only counts at the beginning of a policy so it could be that the policy would pay out to your ex if you died while it's still running. I really don't know if you can stipulate your wishes if you're just the beneficiary, it could be something to ask your divorce lawyer if you have one.

 

HB

[raydetinu]

It is not unusaual for this to happen and it often occurs even after a divorce; in that one half takes out life assurance on the other, particularly if there are dependants, children and the like, so if one dies they have something to fall back on to replace any support that was being provided.

A similar thing happened when I got divorced there were several life policies on each of us, which I paid, but when divorced we split them and continued paying for our own and when they matured we both got the benefit from the original policies. ( would have lost so much cashing them in ).

If this was not covered in the settlement I dont think there is anything you can do now, but consult you solicitor they may be able to advise.

[steevw]

At the moment, there has not been any settlement of assets as the divorce application is in the early stages. I would have been prepared to allow her to continue with the policy but she is being difficult and I feel less inclined to do so now. As nothing has yet been settled, is there scope to include this still or can she simply veto any suggestions?

 

Many Thanks ...

[raydetinu]

you can discuss anything, agreement is something else.

what would you lose if she kept it going or are you just being awkward and acrimonious?

[*Thumper]

It is a marital asset, (if there's a surrender value). or a marital liability, if there's non.

Either way, it will need to be dislcosed, before you can arrange an asset split.

 

And then can be negotiated as part of any settlement, to either of you.

Ad it to your list of assets, and liabilities, to declare to your solicitor.

[steevw]

I hear what you say raydetinu – my wife took what little money we had and ran off to South Africa. I have been very accommodating so far and, after two years separation, asked her to divorce me as she gets legal aid where she is living now. She has agreed, she’s found a solicitor, but she refuses to pay the fairly minimal court costs. I was prepared to leave the policy as it is so that she could benefit, but I’m having second thoughts because of her intransigence. If I now divorce her and make this a condition, I’m not sure if she can dig her heels in and refuse to dissolve our marriage on the basis of this policy. The divorce is important to me as I am retired now and wish to get on with my life, but it seems wrong that someone who almost wrecked my life and took any money I had, should still be controlling me after more than two years. That she should now benefit from my death also is a hard pill to swallow. If I can get the policy surrendered, she will have no reason not to pay the divorce costs and she can keep the rest of the money or reinvest it.

[raydetinu]

steevw, I now understand and sympathise.

As for the divorce process, here anyway, is not dependant on any financial issues, that gets sorted later, and will proceed quite quickly.

There then follows a series of financial dispute resolution hearings( if not sorted between yourselves before ), normally three, heard by different judges!

This can and often does get expensive with solicitor and often barristor representation. ( I know, been there TWICE, represented myself the last time to save money and wiped the floor with her barristor, they got everything wrong as thought it would be a cakewalk, got away with half what she wanted and kept my pensions in both) !!

Suggest you do a bit of online research.

If the policy has any monetery value if surrendered or sold on, then that will be put in the pot, along with pensions etc.

[raydetinu]

Sttevw, any further thoughts?