With a divorce many things change

With a divorce many things change

The number of divorces continues to decline, as a recent statistic shows. However, anyone affected by a separation or divorce has a lot to consider. It is not only the possessions that need to be divided up, but also the insurance cover that needs to be adapted to the changed situation.

Last year there were the fewest divorces compared to the previous 25 years. Who is affected by a divorce or separation, however, must usually regulate many things. In addition to the division of the household and the clarification of any necessary maintenance and custody issues, the insurance coverage must also be adjusted accordingly, for example, as gaps in coverage can arise as a result of a separation.

According to the German Federal Statistical Office (Destatis), last year there were around 153.500 divorces, that's just under 8.900 divorces and thus almost 5.5 percent less than in 2016. It is also the lowest value since 1992, when it was around 135.000 divorces.

The average duration of marriage until divorce was 15 years in 2017, as in 2016. On average, women were not quite 44 years old and men almost 47 years old at the time of the divorce. However, more than one in six divorces involved couples who had been married for 25 years or more. A little more than half of the couples involved had minor children at the time of the divorce.

Separation from table and bed

Most divorces are preceded by a separation of one or more years. This means that even before the divorce, the housing, income and living situation changes fundamentally for the spouses concerned and possibly also for the children. In addition to the property and assets, this also applies to the previous coverage by existing insurance policies. Already the separation and the move into another dwelling can lead to the fact that the up to now existing insurance protection does not apply any longer for all family members.

After a separation, it should be clarified, for example, whether the existing household insurance should apply to the previous apartment of the remaining partner or to the new apartment of the moved-out partner. Depending on who was previously listed as the policyholder on the existing homeowner's policy, it may be necessary for the other partner to purchase a new homeowner's policy for their current home if they desire coverage.

The owner of the previous household contents policy should, if there are changes in the value of the remaining household contents, for example due to the partner moving out or due to his own move, adjust the agreed sum insured accordingly.

Suddenly no longer co-insured

Children who were previously insured under an existing private liability and/or private legal protection policy generally remain insured after a divorce. However, this does not apply to a previously co-insured spouse. Insurance coverage for a co-insured partner in such insurance policies usually does not end with separation, but at the latest with divorce.

Anyone who, as an ex-spouse, was not the policyholder for the previously existing personal liability policy or the private legal protection contracts should therefore take care to conclude corresponding insurance contracts at an early stage. Otherwise, there could be gaps in coverage that could jeopardize the existence of the family in the event of a claim.

The personal liability policy, for example, is one of the most important insurances that private individuals should have. Because anyone who accidentally harms another, for example as a pedestrian or as a bicyclist, must bear unlimited liability for the damage caused. A personal liability insurance covers such damages, but also fends off unjustified or excessive claims of others.

All about the family car

The spouse who is registered as the policyholder in a car insurance policy usually also owns the no-claims bonus (SFR) on which the policy is based. This usually applies even if the other (ex-)partner is registered as the owner in the car insurance policy or in the car registration certificate.

If the person who was not previously the policyholder continues to drive the car for which the car insurance contract exists after the divorce, he or she should take out his or her own car insurance for the car.

The SFR can be transferred to the (ex-)spouse under certain conditions, but this usually requires the consent of the previous policyholder.

What to look for in a life and accident insurance policy

If, in the case of an existing life and/or accident insurance policy, the spouse is entered by name as the beneficiary in the event of death, the ex-partner would also receive the corresponding insurance benefit after a divorce. If the policyholder wants to avoid this, it is important to change the beneficiary. An appropriate change instruction to the insurer should take place best in writing.

However, if the beneficiary is specified as "irrevocable," the policyholder needs the written consent of the previous beneficiary to make a change. If only the term "spouse" is mentioned in the policy as the beneficiary without a specific name of the person concerned, it may be that even after a remarriage not the current but the divorced spouse will receive the benefit.

This is shown by a court decision of the Federal Court of Justice (Ref.: ZR 437/14). Therefore, one should definitely update the entitlement accordingly, for example, after a separation, divorce or remarriage. The extent to which the capital saved up to now in an existing life and/or pension insurance policy is divided up in terms of property law in the event of a divorce depends on various criteria, such as the type of policy and the marital property regime.

Inform insurer and secure documents

In principle, it is important to inform all insurers with whom an insurance policy exists about changed life and family circumstances such as separation, divorce or remarriage. A separation or divorce can also affect other existing insurance policies such as private health insurance, supplementary health insurance or building insurance, and even the protection provided by the statutory health insurance.

In principle, it is therefore advisable to seek advice from an insurance specialist in the event of changes in life and family situations, such as a (pending) divorce, in order to avoid unpleasant surprises or even gaps in coverage that could jeopardize the existence of the family. With regard to statutory health insurance coverage, the health insurance company with which you have been insured up to now is the right point of contact.

Also a change of address and/or bank details should be communicated immediately to all insurers. If, for example, you have an outdated account number stored in the policy when the premium is debited, you may not only risk reminder fees, but also the loss of insurance coverage if you fail to pay the premium. To ensure that important documents such as existing insurance policies are not "lost" in the event of a separation, everyone should check whether they have important documents in their possession in their entirety. 

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