Should I Insure My Child Support Payments? 

• November 7, 2017
• CLLB Law
• Family Law

Child support in a divorce ensures that parents give their child the quality of life and support they intended to provide while they were still married. It’s a critical component of most divorce agreements when the couple has children. Yet what many parents fail to consider is what will happen to their child’s quality of life and their support payments if at some point in the future the supporting parent dies or becomes disabled. In these instances, the income providing the support stops, but the child’s need for support does not. One way to ensure that the child will receive all of the support necessary, in spite of obstacles like these, is through insuring the child support. Many parents are not aware that this is an option, so they leave their children vulnerable.

Using Life Insurance to Insure Child Support

Insuring child support against the death of the parent can be done through life insurance coverage. If the payor parent, the one paying the child support, has life insurance, the separation agreement can be structured so that the life insurance is used to pay child support should the parent pass away.

Life insurance cannot be set up to continue payments as they were when the paying parent was alive. It can, however, be set up with a beneficiary that ensures the child’s needs are met. By naming someone as the child’s custodian, and then naming the custodian as the beneficiary with the purpose of using the money for the child, the parent can ensure that support continues even after death.

Disability Insurance for Child Support

Your death is not the only risk that faces your child when you are the parent paying child support. If you are injured to the point that you cannot work, your child won’t receive the support needed to enjoy a high quality of life. Disability that prevents someone from working is actually a much greater risk than the risk of death, according to the Social Security Administration. Yet many parents fail to plan for disability protection for their child support payments.

Protecting against disability risk takes a little bit of creativity. Specialized disability insurance policies can help provide this critical protection. Disability insurance can help, but sometimes the insurance payouts are not sufficient to continue the child support payments. In these cases, additional policies designed specifically for support payments are necessary. Some of these additional policies can be purchased by the parent receiving the support, so that the money continues to come in even if the payor is disabled and not insured.

Why Is Insurance So Critical?

When you are raising a child, the costs you face are monumental. When you go from two incomes to one, or lose the support of the main breadwinner, the parent who has custody of the child faces serious financial risk. This puts the child’s quality of life in jeopardy. While most divorcing parents have every intention of paying their child support as ordered, no one can predict catastrophic events like death or disability. Providing insurance protection ensures your child’s needs are met, even when you cannot do so.

Do you have additional questions about how you can protect your children’s well-being after divorce? Whether you are the custodial parent or the supportive one, the attorneys at Church, Langdon, Lopp, Banet Law are ready to find creative solutions to your questions. Call them at 812-725-8224 today.