Do life insurance proceeds that are payable to a beneficiary who is going through a divorce get split?
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Do life insurance proceeds that are payable to a beneficiary who is going through a divorce get split?
I received $175,000 death insurance payoff when my father died 1 year ago. I put it in a account under my name and kept it there. I am now thinking about getting a divorce. Can I protect the account or will my wife get half?
Asked on August 17, 2011 North Carolina
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
By way of background, in a divorce settlement some property is considered to be"marital property" and some is considered to be "separate property". Further, even if an asset is initially separate property, if it is "co-mingled" with marital assets it to can become a marital asset. That having been said, a gift or inheritance (and life insurance proceeds would be included here) are separate property not subject to equitable distribution in a divorce. Further, since this has been kept in a separate account in your name only, there as been no co-mingling of assets. Therefore, your wife should have no claim to these proceeds.
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