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Woman receives ex-husbands life insurance despite divorce

Divorcing Massachusetts couples have a lot of considerations they must make before their divorce can be finalized. As any Massachusetts divorce attorney knows, one of the most important issues are those surrounding the division of property. Property division disputes arise when people need to decide which person is going to take which assets and debts following the divorce. Property division issues are extremely important since after the divorce each person will be starting a new and independent financial life.

If these decisions are not well thought out, or carefully executed, problems can arise for years to come. Take, for example, a recent case at the United States Supreme Court. In that case, a man had a life insurance policy worth just over $124,000. When he died, it was discovered the beneficiary of the policy had never been changed from his ex-wife to his current wife. After years of fighting over the money in court, the Supreme Court recently ruled that the money belongs to the ex-wife.

Despite the fact that this man had been awarded this insurance policy -- this asset -- in the divorce, the money still ended up in the hands of his former spouse because all the proper steps were not taken. Had his ex-wife been removed from the policy at the time of the divorce, this case would never have been an issue.

This case highlights the importance for Massachusetts couples to look carefully at all aspects of property division during their divorce. While it is important to figure out who will take what property, it is even more important to understand how that will affect each person in the future. Issues like tax liability or beneficiaries cannot be overlooked.

Source: Forbes, "Supreme Court Favors Ex-Wife Over Widow In Battle For Life Insurance Proceeds," Deborah L. Jacobs, June 3, 2013

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