Is a spouse entitled to any portion ofan insurancepayout as part of a divorce settlement?

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Is a spouse entitled to any portion ofan insurancepayout as part of a divorce settlement?

Going through a divorce and also awaiting an insurance settlement. Is my wife entitled to half of any of the claim. Have been married for 33 years.

Asked on March 18, 2011 under Family Law, Massachusetts

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

You didn't indicate what type of insurance settlement.  That having been said, your spouse's rights remain the same as if you were in a stable marriage (unless there is a legal separation agreement in effect to the contrary).  However, if the settlement is to compensate for injuries, pain and suffering, loss of enjoyment, or medical bills that do not have any impact on the marital estate, the settlement is separate property and should be fully awarded to the injured person. 

Note:  In some states, courts have held that a personal injury settlement is marital property in the following situations: commingling assets by accepting the entire settlement in 1 check made payable to both parties; compensation for lost wages; and medical bills that have an impact on the marital estate.  In addition, when there is a lower settlement amount than what would have otherwise occurred due to low policy limits or a lack of funds from the responsible party, there is no abuse of discretion for a court to allocate a portion of the settlement to lost wages even when the settlement indicates that it is for personal injury only.

At this point you need to consult directly with a MA divorce attorney as to your specific situation.


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