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More Things About Divorce Planning You've Just Got To Know

Donít Forget Casualty Insurance

Last week was the first of three Flying Solo segments designed to provide you with basic information about planning for divorce. This is the second:

Understand Automobile and Property Insurance.

Never cancel any insurance. Without coverage, a claim or casualty loss could wipe out the assets you have accumulated. If you leave home, you need a separate policy to cover personal property you take with you. You may need a separate auto policy. Most property insurance is written for the family unit. When that unit breaks up, care may be transferred and your property may belong to someone else. This means that there may not be coverage. So find out what your policies cover. And make sure to get it in writing from the agent.

If you move, you may need insurance coverage for your property during transit. Keep an amount in a savings account equal to your deductibles. Make sure your coverage limits are sufficient to replace your property at todayís value, not its depreciated value. Obtain the replacement costs.

Jewelry, furs, and other valuables must be listed, appraised, and covered separately. List and photograph or videotape all of your personal property and put the film record in a safe place. Make sure all automobiles continue to be covered until your case is finally resolved and then have a plan to substitute coverage.

Health Insurance Coverage Essential

You must review your health-insurance coverageónoncovered medical expenses can wipe you out. Without planning, changes in health-care coverage can be risky and cause continued litigation and expense. Managed care has revolutionized health coverage. If you are covered by an HMO or PPO, find out if you will be covered and what needs to be done to assure continuation of coverage Ė especially if you are thinking about moving to another town or state.

If you rely on coverage at work, find out how to continue coverage on the noncovered spouse and children. And make sure that the coverage is with a financially stable insurance company. If an employer secures health coverage from someone other than an insurance company, or if there have been frequent shifts in the insurance plan, watch out!

In some employee health plans, term life and disability insurance are included as benefits. Check into them. If thereís no coverage at a place of employment or current health insurance will not cover the family, begin looking for major medical and hospitalization alternatives immediately. Plan now for pre-existing conditions that might make it difficulty for the nonworking spouse or children to secure or continue health coverage. Always read the policy and do not rely on a brochure or the representations of an agent.

If you are in good health, think about purchasing an individual health policy rather than taking a chance with COBRA which, after 36 months, can become very expensive.

Never cancel any insurance policy until you know what is going to replace it. Never buy a policy until you know whatís covered and when coverage begins. If one spouse was or is in the military, check on medical benefits that may be available. If one spouse is or was a civil service employee, check into what is necessary to provide for continuation of your coverage.

See which medical, dental, and prescription bills are not covered by health insurance and try to build these expenses into your settlement or presentation to the Court.

Learn About The Basics of Alimony and Support

Each state has its own laws that govern alimony and support. Always review these with your lawyer. Review and understand the tax consequences of what you are going to pay receive-óbefore you make final arrangements. Itís a good idea to check things out with a CPA or tax lawyer. If a child is disabled then there must be planning for both regular payment and special education. Any settlement should be structured around public benefits and should avoid reimbursement to the government. Itís always better to plan if either a spouse or child has serious disabilities.

Plan for Your Childrenís Educations

Generally, both parents are responsible for a childís college education depending on their income and assets. Determine if a fund should be established to assure coverage of educational obligations. If so, in what form, how should it work, and how can it best be funded? Find out what financial aid by law of grants or loans may be available. Check into special programs for disabled children and how to avoid reimbursement. Make sure your estate plan follows the rules that will allow a disabled child to receive the best care available Ė including special needs trusts. Remember that grandparents can give more than $10,000 per year per grandchild by paying for education so long as they make payments directly to the college or university. Utilization of this benefit is good estate planning for some grandparents.

Jan Collins is an award-winning writer and editor. Jan Warner is a matrimonial, elder, and tax attorney. Both are based in Columbia, South Carolina. Flying Solo is seen in newspapers throughout the United States.

Please send your questions by e-mail to or by mail to P.O.Box 11704, Columbia, SC 29211.

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