Skip to content 
Divorce changes the structure of a family, and insurance policies often sit in the background until a dispute forces everyone to pay attention. Each policy carries its own rules, financial stakes, and long term consequences. Couples often discover that insurance coverage connects deeply to support obligations, financial protection, and the future safety of children. This guide breaks down the key types of insurance that usually come up during a Texas divorce and explains how each one fits into settlements, negotiations, and long term planning.
Health Insurance and Divorce
Health insurance becomes one of the first issues couples handle. Many households rely on one spouse’s employer sponsored plan. Once a divorce becomes final, the dependent spouse usually loses access to that coverage unless an agreement keeps it active for a certain period.
Texas courts expect parents to provide medical support for children. A parent who carries the children on their employer sponsored plan may continue doing so after divorce because the court considers that part of child support. The other parent might provide cash medical support if needed. Judges focus on reasonable cost and consistent access rather than which parent prefers to carry the plan.
A spouse losing coverage under an employer plan after divorce may use COBRA. COBRA gives temporary coverage, but the premium often becomes expensive. Many people use COBRA as a short term solution while searching for marketplace insurance or a new employer plan. Couples can negotiate premium responsibility during the divorce, especially when one spouse depends heavily on ongoing medical treatment.
Life Insurance and Divorce
Life insurance often connects directly to child support and spousal maintenance. If one spouse must pay long term financial support, a Texas court may require a life insurance policy to protect those payments. This prevents support obligations from ending early if the paying spouse passes away.
Couples should review the beneficiary designation before the divorce becomes final. Many people forget they listed their spouse years ago. Texas law sometimes restricts former spouses from collecting on old beneficiary designations, but relying on that creates confusion for loved ones. Updating the policy during the divorce process helps prevent disputes and failed claims.
Some couples use life insurance as part of asset division. A cash value policy carries monetary value that may belong to the community estate. Cash value might be divided, exchanged for another asset, or awarded entirely to one spouse. Term policies do not carry value, but they still matter when tied to support obligations.
Auto Insurance and Divorce
Auto insurance coverage changes once couples separate their households. A shared policy might cover multiple vehicles under a single rate. Companies may ask policyholders to notify them once spouses live in different homes because the risk profile changes. Each spouse should secure a separate auto policy in their own name once property division assigns vehicles.
Driving history, claim history, and credit factors may affect new premium costs. Some spouses discover they qualify for a lower rate alone, while others see an increase. The settlement should clearly assign each vehicle so an insurer knows who holds ownership and responsibility.
Homeowners and Renters Insurance
Homeowners insurance usually follows property ownership. Once the marital home goes to one spouse, that spouse becomes solely responsible for premiums and maintenance. Mortgage lenders often require continuous coverage, so the spouse keeping the home needs to secure proof of insurance as soon as possible.
A spouse who moves into an apartment may need renters insurance. Renters insurance protects personal belongings and provides liability coverage. This becomes especially useful during property division when spouses receive new furniture, electronics, or valuables that need coverage.
Disability Insurance
Disability insurance becomes relevant when long term income protection plays a role in financial negotiations. If one spouse pays child support or spousal maintenance, disability coverage can protect those payments if an injury or illness prevents work. Couples may negotiate responsibility for premiums during the divorce if the policy protects court ordered support.
Some employers provide disability benefits automatically. Others allow optional enrollment during open enrollment periods. Spouses who rely on support payments often want the paying spouse to maintain disability coverage to reduce financial risk.
Umbrella Insurance
Umbrella insurance extends liability coverage beyond standard auto or homeowners policies. Divorce changes household size, ownership, and responsibility. Spouses who own businesses, rental properties, or high value assets often maintain umbrella coverage to protect themselves against unexpected lawsuits.
During divorce, each spouse must decide if they want their own umbrella policy. Sharing coverage rarely makes sense once households separate. The policy follows the insured individual, and each person should evaluate their personal liability risk after property division.
Long Term Care Insurance
Long term care insurance usually becomes a discussion point in divorces involving older spouses or significant retirement assets. The cost of long term care can drain savings quickly. A policy that covers assisted living or in home care becomes valuable during settlement negotiations.
If one spouse purchased a long term care policy during the marriage, it might count as community property. Couples may negotiate premium responsibility, cancellation, replacement, or a buyout. Keeping the policy might benefit both spouses depending on age, health, and long term goals.
Insurance Responsibilities in the Final Decree
Texas divorce decrees often include specific instructions about insurance responsibilities. These instructions help prevent misunderstandings and future conflicts. Common requirements include:
- Keeping children covered under the same health insurance plan until a certain age
- Maintaining life insurance to secure support obligations
- Providing proof of coverage to the other spouse
- Notifying the other spouse before changing beneficiaries or coverage levels
A well written decree makes each person’s responsibility clear. Couples should review every insurance clause before signing to avoid gaps or unexpected expenses.
Temporary Orders and Restrictions on Insurance Changes
Temporary orders often prevent any immediate changes to insurance policies during a divorce. These orders protect both parties by ensuring that existing health, life, or property insurance coverage remains intact until the case is resolved. Without this protection, one spouse could remove coverage, leaving the other vulnerable.
Why You Should Consult Your Lawyer
Consult with your attorney before attempting to change any insurance policy during the divorce. Ignoring these orders can lead to penalties or complicate your case. Following the proper legal procedures helps protect your rights and ensures all policies remain valid until the divorce is finalized.
Protecting Your Financial Future with Proper Coverage
Maintaining the right insurance policies ensures financial security for you and your children. Divorce changes many aspects of your life, and insurance should adapt to those changes. Assess all your coverage options, from health and life insurance to auto and home policies.
Seek Professional Guidance
Work with a financial planner or insurance expert to evaluate your needs. They can guide you through adjusting existing policies or finding new coverage where necessary. Taking these steps now will help protect your finances, preventing costly surprises in the future.
Conclusion
Insurance plays a crucial role in divorce proceedings. Failing to address it could leave you and your family financially vulnerable. While managing the legal and emotional aspects of divorce, it’s essential to review your insurance policies. Ensuring you have the right coverage in place will provide peace of mind and safeguard your financial future during this challenging time.
eBooks
If you want to know more about what you can do, CLICK the button below to get your FREE E-book:
Other Articles you may be interested in:
- Life Insurance and Its Role in Property Division as Part of a Texas Divorce
- What You Need to Know: Will I Lose Health Insurance Because of a Divorce in Texas?
- What are important topics surrounding insurance in a Texas divorce?
- I Want a Texas Divorce but My Husband Doesn’t: What can I do?
- Am I Married? – Marital Status in Texas
- Can I sue my spouse’s mistress in Texas?
- 6 Tips – On How to Prepare for a Texas Divorce
- Roadmap of Basic Divorce Procedure in Texas
- 6 Mistakes that Can Destroy Your Texas Divorce Case
- Does it Matter who Files First in a Texas Divorce?
Law Office of Bryan Fagan, PLLC | Spring Divorce Attorneys
The Law Office of Bryan Fagan, PLLC routinely handles matters that affect children and families. If you have questions regarding divorce, it’s important to speak with one of our Spring, TX Divorce Attorneys right away to protect your rights.
Our divorce attorneys in Spring TX are skilled at listening to your goals during this trying process and developing a strategy to meet those goals. Contact the Law Office of Bryan Fagan, PLLC by calling (713) 564-7029 or submit your contact information in our online form.
