Do You Need Divorce Insurance?
Is it any surprise that an enterprising insurance company is now offering divorce insurance? Everyone knows that getting a divorce can cost a small fortune these days. The price of splitting up in the United States can easily range from a few thousand dollars to over $20,000 depending on the situation and the assets involved. In that light, purchasing a few bucks of divorce insurance every month might pay big dividends when the relationship goes awry. It would certainly be an advantage to have your court and attorney costs covered by an insurance policy when facing an expensive divorce battle in court.
The North Carolina-based SafeGuard Guaranty Corporation thinks divorce insurance is a good idea and now offers a divorce insurance product called WedLock. The WedLock insurance policy was created to provide financial assistance in the form of cash to cover the costs of the legal proceedings a divorce, as well as other expenses that might arise like setting up a new apartment or house after the divorce.
Each unit of WedLock insurance costs $15.99 a month and provides a benefit of $1,250 to cover divorce expenses. A $1,250 benefit will not cover an entire divorce of course, and spouses are encouraged to purchase multiple units of coverage. In order to obtain a more realistic amount of coverage totaling $12,500, a client would have to purchase 10 units at $15.99 each for a total monthly bill of $159.00. SafeGuard also adds another $250 of coverage to each unit of coverage that is held for a full year.
Once a policy has matured, WedLock clients receive a lump sum of cash equivalent to the amount of coverage purchased as soon as they furnish proof of their divorce. In order to prevent people who are already planning to get a divorce from taking advantage of the insurance, SafeGuard requires a period of 48 months of marriage before a policy is considered matured and the pay-off is guaranteed. Prospective clients also have the option of purchasing additional riders to reduce the maturity date to 36 months. They can also get their premiums reimbursed if a divorce occurs before a policy matures.
Whether or not people would be better off by simply putting their money into a savings account is debatable. Some people will obviously pay for coverage that they will never use if they don’t get divorced and others may not have to spend tens of thousands of dollars on their divorce in the first place. The SafeGuard Company thinks the insurance is the better bet and thoughtfully provides a Divorce Cost Calculator and a Divorce Probability Calculator on its site to help people make up their minds about whether they really need divorce insurance, or not. One thing does seem certain though, as an idea whose time has come, more companies will probably begin offering similar divorce insurance products.