Itâ€™s a part of life–many marriages end in divorce. And often one of the former spouses is left in dire financial straits in the aftermath. This is especially true for women, who can expect a decline in household income of about 37%.
One company, North Carolina-based SafeGuard Guaranty Corp., has a solution: divorce insurance. Â The corporation, who partnered with Prime Insurance Co., claims to be the first in the world to offer divorce insurance. The product has been named WedLock and is meant to decrease the costs associated with divorce, such as legal fees. In order to avoid fraud, the company has a four-year waiting period before a claim can be made.
Coverage is sold through â€œunits of protection,â€ that cost $15.99 per month. The Website describes divorce insurance as â€œan annually renewable, premium guaranteed form of casualty insurance that provides a lump sum of cash (based on initial claim value units of $1,200 per unit purchased up to $250,000) that is paid if your marriage ends in divorce.â€ Each unit increases in value by $250 each year after the policyâ€™s maturity period ends and the premium stays fixed.
Why not just put $15.99 in a savings account each month instead of purchasing divorce insurance? Well, the folks at WedLock have already answered that question. They assert that most people donâ€™t have the discipline to save on a regular basis. They also argue that if you live in a community property state, the money youâ€™ve saved up could be split between you and your former spouse.
If youâ€™d like to measure your risk for divorce, WedLock has a handy Divorce Probability Calculator. If you find that you have a high chance of divorce, WedLock also has a Divorce Cost Calculator to help you determine how much insurance you should purchase.
What are your thoughts on divorce insurance? Would you buy it?Â Letâ€™s hear your opinion on this one.
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