Infidelity's Impact: Life Insurance And Cheating

Infidelity can have a devastating impact on a relationship, and it's not uncommon for it to lead to separation or divorce. But can it affect life insurance, too?

Well, it depends.

If you're the one who's been cheated on, you might want to remove your ex-spouse as the beneficiary of your life insurance policy. Most policies are revocable, meaning you can change the beneficiary at any time. However, some appoint irrevocable beneficiaries, in which case the beneficiary cannot be changed.

If you have children and your ex-spouse has custody, you may want to maintain a life insurance policy for your ex with a benefit amount high enough to replace child support or alimony. This is to protect your children's financial interests in the event that something happens to you.

On the other hand, if you're the one who cheated, your ex-spouse may remove you as the beneficiary of their life insurance policy, and they might also cancel any policies they have taken out for you.

So, while infidelity may not directly affect life insurance policies, it can certainly lead to changes in how those policies are structured and who benefits from them.

Beneficiaries and ownership

In the event of a divorce, it is important to update the beneficiaries and policy owners of a life insurance policy to account for the change in marital status and its implications. Term life insurance is often considered a separate asset, but the cash value in a permanent policy may be considered joint.

If the policy has a cash value, you can choose to cash it out and split the proceeds with your ex-spouse. If there are children and one spouse takes primary custody and receives alimony or child support, maintaining a life insurance policy on the other ex-spouse can be a good idea. Should that ex-spouse die, the benefit should be high enough to replace this income until the children are no longer minors.

If you get primary custody of the kids and can’t rely on your ex financially, you may want to own the policy and pay the premium. If the premiums aren’t paid, the policy will lapse and coverage will be lost. If your ex-spouse is no longer in the picture and you are raising children on your own, you still need life insurance and can take out a policy on yourself and pay the premiums.

If you have primary custody of your children, maintain a policy on your ex with a benefit amount high enough to replace child support or alimony at least until the last child is grown. If you end up a single parent, it is a good idea to take out life insurance on yourself.

Changing Beneficiaries

Most life insurance policies are revocable, meaning the policy owner may change the beneficiary at any time. Some appoint irrevocable beneficiaries, in which case the beneficiary, once designated, cannot be changed. The easiest way to change your beneficiary after a divorce is to contact your life insurance agent so that they can verify if the policy is revocable and help you redesignate your beneficiary.

A beneficiary of a life insurance policy cannot be changed after the insured person dies.

Accounting for Cash Value

Some life insurance policies, particularly whole life and universal life policies, accumulate cash value over time. Each month when you make your premium payment, a portion of that money enters a fund that grows with interest. The balance of this fund is the policy's cash value. This is your money. At any point, while the policy is active, you may elect to forgo the death benefit and instead take the cash value. This process is known as cashing out your life insurance policy.

The cash value from a life insurance policy represents part of your net worth as a couple. The most equitable thing to do is to list the life insurance policy, including its cash value, among the marital assets to be divided. In a divorce in which assets are divided evenly, this means each spouse leaves the marriage with half the cash value from the policy.

Cash value

The cash value of a life insurance policy is the sum of money that has accumulated over time. Each month, when the policyholder makes a premium payment, a portion of that money is put into a fund that grows with interest. This fund is the policy's cash value. The policyholder can choose to cash out their life insurance policy and receive this cash value at any time.

In the event of a divorce, the cash value of a life insurance policy should be listed among the marital assets to be divided. This is because the cash value represents part of the couple's net worth. In a divorce where assets are split evenly, each spouse would receive half of the cash value from the policy.

If there are children involved, the cash value of a life insurance policy can be used to protect their financial interests. The parent with primary custody can maintain a policy on their ex-spouse with a benefit amount high enough to replace child support or alimony until the last child is grown. This ensures that the children's financial needs are met even if the non-custodial parent passes away.

Divorcing couples should also update the beneficiaries of their life insurance policies to reflect their changed marital status. Most life insurance policies are revocable, meaning the policy owner can change the beneficiary at any time. However, some policies appoint irrevocable beneficiaries, in which case the beneficiary cannot be changed.

Alimony and child support

Adultery can have legal implications for divorce proceedings, including alimony and child support, but this varies depending on the state and whether it is a fault-based or no-fault divorce system.

In fault-based divorce systems, adultery can be grounds for divorce and might influence the outcome of alimony and asset division. However, in no-fault divorce systems, it is no longer necessary to provide a reason for the divorce, making it easier and preventing your spouse from challenging the divorce. Nevertheless, the extent of a spouse's infidelity can still have an effect on divorce proceedings, particularly when determining alimony, asset division, and child custody.

In some states, a spouse's adultery will not impact alimony or spousal support. For example, California, Wisconsin, and Canada have no-fault divorce laws, so infidelity has no impact on spousal support. The primary factor for determining alimony in these cases is the financial needs of the spouse receiving it and the ability of the other spouse to pay.

On the other hand, in states like New York and Arkansas, adultery can be considered when determining alimony payments. In these states, judges have the discretion to consider a spouse's adultery when deciding whether to award alimony and how much to grant. However, adultery alone will not decide the spousal support argument, and other factors such as the need for support and the ability to pay are also taken into account.

Child support, on the other hand, is typically calculated based on a state's child support guidelines, which primarily consider the income of the parents, the number of children being supported, and certain additional expenses. Therefore, a parent's adultery usually does not play a role in determining child support payments, as these payments are meant to meet the needs of the children rather than punish or reward the parents.

Trust issues

Infidelity can have a devastating impact on a relationship, and it is not uncommon for those involved to experience intense, long-lasting mental health challenges. The breach of trust can lead to feelings of abandonment, rejection, deceit, and humiliation, which can have far-reaching consequences for the mental health of both parties.

Emotional and Psychological Effects

The emotional fallout from infidelity can be severe and long-lasting. The sense of betrayal can trigger feelings of low self-esteem and self-worth, as the betrayed partner may internalise the infidelity and blame themselves. This can lead to chronic stress, anxiety, and depression, with research indicating that 76% of couples affected by infidelity reported negative impacts on their relationship, and 10% got divorced.

The effects of infidelity can be likened to withdrawal symptoms, with love and drugs producing similar effects on the brain through the release of dopamine. The rejection caused by infidelity can, therefore, have a profound impact on brain chemistry, leading to short- and long-term consequences.

The loss of trust is often the most challenging aspect to overcome following infidelity. It can be difficult for the betrayed partner to trust again, not only their former partner but also themselves and their own judgement. This can lead to a state of constant hypervigilance, where they may unconsciously associate the pain of infidelity with future relationships, making it harder to connect with someone new.

Impact on Future Relationships

The impact of infidelity can extend beyond the immediate relationship, affecting future romantic connections. Research indicates that children who witness infidelity are twice as likely to be unfaithful themselves and may struggle with trust issues and negative perceptions of fidelity.

Healing and Recovery

Healing from infidelity is possible, but it takes time and effort from both parties. Open and honest communication is essential, along with a willingness to address the root causes of the infidelity. Therapy and counselling can provide valuable support, offering strategies to improve trust, honesty, and transparency.

While the pain of infidelity is inevitable, it is possible to work through it and move forward, either together or separately.

Effects on children

Children are perceptive and intuitive beings, and extra-marital affairs can be harmful to them even if they are not explicitly told about them. Children can pick up on changes in their parents' behaviour, and affairs can take the straying spouse's time and attention away from the family unit, thereby depriving the child.

Emotional Stress

Children can feel pressured to become the caretaker or protector of the wronged parent, which increases their emotional stress. Shame, loss of trust, confusion, resentment, and ambivalence towards the betraying parent, as well as acting out, are common experiences for children of cheating spouses.

Caretaker Role

Children can feel pressured to become the caretaker or protector of the wronged parent, which increases their emotional stress.

Trust Issues

Shame, loss of trust, confusion, resentment, and ambivalence towards the betraying parent, as well as acting out, are common experiences for children of cheating spouses.

Acting Out

Shame, loss of trust, confusion, resentment, and ambivalence towards the betraying parent, as well as acting out, are common experiences for children of cheating spouses.

Long-Term Effects

The long-term effects of infidelity go beyond future relationship behaviour. According to clinical psychologist Ana Nogales, growing up in a family with infidelity has lasting impacts on children in terms of how they view their romantic relationships and their ability to trust future partners.

Nogales' research found that:

• 75% of children experience lingering feelings of betrayal toward their cheating parent.
• 80% say that the infidelity shapes their outlook about romance and relationships.
• 70% describe the infidelity as affecting their general trust in others.

Communication

If parents display emotional control and explain that these things are unfortunate but can be overcome, the trauma for children can be eased.

Therapy

A family counsellor can offer guidance on how to discuss difficult topics with children without placing additional emotional burdens on them.

Frequently asked questions