Broker Check

10 Reasons Why Disability Insurance Should Be in Every Separation Agreement

December 12, 2023

In my last blog post I reviewed what disability insurance is and why it’s so important to have. Disability insurance is the answer to when you suddenly find yourself as the primary breadwinner and others, such as your children, rely on your income for daily necessities. Now, I want to discuss further why having disability insurance in a separation agreement is essential in protecting your financial future.


When navigating through the intricacies of a separation agreement, one aspect often overlooked is disability insurance. Yet, this component can be crucial for both parties' financial stability. Here are the top ten reasons why I think including disability insurance in your separation agreement is essential.


  1. Financial Security in Case of Disability:

Disability insurance provides a safety net if one party cannot work due to illness or injury. Including it in the agreement ensures the disabled party can maintain a stable income.


  1. Protecting Child Support and Alimony Payments:

If the party responsible for child support or alimony payments becomes disabled and cannot work, disability insurance ensures these support payments continue, safeguarding the financial well-being of children and the dependent spouse.


  1. Reducing Financial Stress During Difficult Times:

Dealing with a disability is challenging enough without the added stress of financial instability. Having disability insurance in place alleviates this burden, allowing the focus to remain on recovery and adaptation.


  1. Ensuring Fairness in Settlement:

Incorporating disability insurance into a separation agreement is a fair way to ensure both parties are protected from unforeseen circumstances, maintaining the integrity of the settlement terms.


  1. Mitigating the Impact of Lost Earning Potential:

Disability can severely impact one's earning potential. Disability insurance compensates for this loss, providing necessary financial support.


  1. Long-Term Protection:

Disabilities can be long-term or permanent. Including disability insurance in the agreement ensures ongoing support for as long as needed.


  1. Legal Prudence:

A comprehensive separation agreement that includes disability insurance demonstrates foresight and prudence, potentially avoiding future legal complications.


  1. Confidence:

Knowing that you're covered in case of disability provides confidence in your ability to handle your financial obligations during what can be a turbulent period, allowing you to focus on moving forward.


  1. Adapting to Life Changes:

Life after separation often involves significant adjustments. If disability occurs, insurance can help smooth the transition by providing financial stability.


  1. A Show of Mutual Respect and Responsibility:

Including disability insurance is a sign of mutual respect and responsibility. It shows that both parties are considerate of each other's long-term well-being.


Disability insurance is a critical component of a separation agreement for women, offering financial protection, stability, and confidence during a challenging and uncertain time. Incorporating disability insurance into your separation agreement is more than just a legal formality; it's critical to ensure long-term financial protection for both parties involved. It reflects a thoughtful and comprehensive approach to planning for life's uncertainties. As you navigate your separation, consider the far-reaching benefits of this vital protection.


If you have any questions or want to further your knowledge base about disability insurance, please don't hesitate to reach out. I specialize in helping women navigate their new normal for financial independence, and I want to be in your corner of success, rooting you on to becoming the most financial stable version of yourself you can be.


Schedule a consult with me to see how else I can help.