Navigating Insurance Status Changes: Does Separation Affect Your Coverage?

Separation and divorce are generally considered qualifying life events that allow you to make changes to your health insurance plan outside of the annual open enrollment period. This is known as a special enrollment period, which is designed to accommodate unforeseen circumstances that require a person to obtain health insurance or make changes to their existing plan. During this time, you can either enroll in new insurance coverage or make changes to your current plan.

In the case of separation, if you have a Self and Family enrollment or your spouse is covered under your Self Plus One enrollment, your spouse is typically eligible to continue coverage while you are legally separated or in the process of getting a divorce or annulment. Once the divorce or annulment is finalized, your ex-spouse loses coverage, though there may be a short extension period.

It's important to note that the rules and regulations regarding health insurance can vary depending on your location and the specific insurance provider. Therefore, it is always recommended to review the terms of your insurance plan and consult with the relevant authorities or insurance providers to understand your specific situation.

Qualifying Life Events

A qualifying life event (QLE) is a change in your situation that can make you eligible for a Special Enrollment Period, allowing you to enroll in health insurance outside the yearly Open Enrollment Period.

There are four basic types of qualifying life events:

Loss of Health Coverage

• Losing existing health coverage, including job-based, individual, and student plans
• Losing eligibility for Medicare, Medicaid, or CHIP
• Turning 26 and losing coverage through a parent's plan

Changes in Household

• Getting married or divorced
• Having a baby or adopting a child

Changes in Residence

• Moving to a different ZIP code or county
• A student moving to or from the place they attend school
• A seasonal worker moving to or from the place they both live and work
• Moving to or from a shelter or other transitional housing

Other Qualifying Events

• Changes in your income that affect the coverage you qualify for
• Gaining membership in a federally recognized tribe or status as an Alaska Native Claims Settlement Act (ANCSA) Corporation shareholder
• Becoming a U.S. citizen
• Leaving incarceration (jail or prison)
• AmeriCorps members starting or ending their service

In the context of separation, divorce or legal separation is considered a QLE. If you have a Self and Family enrollment or your spouse is covered under your Self Plus One enrollment, your spouse is eligible to continue coverage under your enrollment while you are legally separated or in the process of getting a divorce or an annulment. Once the divorce or annulment is final, your ex-spouse loses coverage.

Loss of Coverage

• Losing your source of coverage: This could include losing your job, graduating, or dropping out of school, resulting in a loss of health insurance provided by your employer or educational institution.
• Turning 26: In the US, children can remain on their parents' insurance until they turn 26. Once they reach this age, they lose coverage and become eligible for a special enrollment period to obtain their own insurance.
• Losing program eligibility: If you rely on public programs like Medicaid and CHIP for health insurance but experience an increase in income, you may become ineligible. In such cases, you can use a special enrollment period to purchase insurance without government assistance.
• Losing your spouse's employer-sponsored coverage: If your spouse loses their job or their employer stops providing health insurance, you can remove them from your coverage and adjust your insurance plan.
• Divorce: If you are covered under your spouse's insurance and you get divorced, you will lose that coverage and need to obtain your own insurance.
• Death: If someone covered under your insurance plan passes away, you will no longer need to provide coverage for them, but you may also lose their financial contribution towards the insurance plan.
• Aging off a parent's plan: Under the Affordable Care Act, young adults can remain on a parent's health insurance plan through age 26. Once they turn 26, they will need to obtain their own insurance.

Divorce and Insurance

Divorce is a challenging transition and can be overwhelming, especially when it comes to figuring out finances and insurance. Here are some things to keep in mind when it comes to divorce and insurance:

Health Insurance

If you or your spouse had a health insurance plan that covered both of you, you will need to make changes to your coverage. If your spouse had coverage through their employer, you will no longer be covered once the divorce is finalised. You may need to purchase your own insurance plan or explore other options.

Special Enrollment Period (SEP)

Divorce is recognised as a qualifying life event, which means you may be eligible for a Special Enrollment Period (SEP) to purchase health insurance. This SEP typically allows you 60 days to shop for and enrol in a new health insurance plan. It is important to take advantage of this period, as you may have to wait until the annual Open Enrollment Period at the end of the year otherwise.

Continuation of Coverage

In some cases, you may be able to temporarily continue your existing health coverage for a limited time after the divorce. This could be through your spouse's employer-sponsored plan or through a law known as COBRA, which allows you to retain your previous coverage for up to 36 months. However, COBRA tends to be expensive as you will have to pay the full premium yourself.

Divorce Settlement

Health insurance can also be included as part of your divorce settlement. You may be able to require your former spouse to continue providing health coverage for you and your children, or vice versa. However, this may come at an additional cost.

Life Insurance

Life insurance considerations should also be addressed during a divorce. If you have existing life insurance policies, you may need to make changes to the policies, beneficiaries, or ownership. Additionally, you may need to provide documentation of all your current insurance policies as part of the divorce proceedings.

Other Insurance Options

In addition to health and life insurance, there are other insurance options to consider during a divorce. These include legal insurance, legal fee discount plans, and counselling or mental health services that may be covered by your health insurance.

Separation and Insurance Coverage

Separation can be a stressful time, and it's important to understand how it affects your insurance coverage. Here's a guide to help you navigate insurance-related matters during this challenging period.

Understanding Qualifying Life Events

A qualifying life event is a significant change in your life that allows you to make adjustments to your health insurance coverage outside of the annual open enrollment period. These events trigger what is known as a special enrollment period, during which you can modify your insurance plan. Examples of qualifying life events include birth, death, marriage, divorce, adoption, and changes in employment.

Separation as a Qualifying Life Event

Separation, including legal separation and divorce, is generally recognised as a qualifying life event. This means that if you are going through a separation, you may be able to make changes to your insurance coverage. The specific options available to you may depend on the type of insurance you have and the laws of your state.

Impact on Health Insurance Coverage

During a separation, you may need to update your health insurance plan to reflect your changing circumstances. Here are some key considerations:

• Removing your spouse from your coverage: If you have health insurance that covers your spouse, you will need to remove them from your plan. They may be able to continue coverage through options such as COBRA, a program that allows for the temporary extension of health coverage in certain situations.
• Changes in income: Separation can result in a change in income, which may impact your eligibility for certain health insurance programs or subsidies. Be sure to review your income and adjust your coverage accordingly.
• Loss of coverage through your spouse: If you were previously covered under your spouse's insurance plan and are losing that coverage due to separation, you may be eligible for a special enrollment period to enroll in your company's health plan or explore alternative options.
• Dependents and children: If you have children, their insurance coverage may be affected by the separation. Ensure that you make the necessary adjustments to provide them with continued coverage.
• Notification and documentation: It is important to notify your insurance provider of your change in marital status and provide any required documentation, such as legal separation or divorce papers.

Other Insurance Considerations

In addition to health insurance, there are other types of insurance you may need to review during a separation:

• Life insurance: Review your life insurance policy and update your beneficiaries if needed.
• Property and asset insurance: If you shared property or assets with your spouse, you may need to adjust your insurance coverage to reflect your new situation.
• Auto insurance: If you and your spouse shared a car or auto insurance policy, you may need to make changes to your policy or obtain separate coverage.

Seeking Professional Guidance

Navigating insurance during separation can be complex. It is recommended to consult with a qualified insurance broker or agent, as well as a financial advisor, to ensure you understand your options and make informed decisions. They can guide you through the process and help you find the best coverage for your circumstances.

Special Enrollment Periods

Qualifying Life Events for 60-day Special Enrollment Periods

• Loss of coverage: If you lose your insurance, you can use an SEP to buy insurance without government assistance.
• Losing your source of coverage: If you lose your job, graduate, or drop out of school, you can use an SEP to replace that coverage.

Domestic Developments

• Marriage and divorce: The beginning or end of a marriage often counts as a qualifying life event.
• Having children: Whether you have a baby or adopt a child, you’ll need to provide insurance for them, so this life event usually counts as a qualifying life event, resulting in an SEP.
• Death: If someone in your family dies, you’ll lose the need to cover them, but you also won’t have their income to help pay for coverage. For these reasons, the death of someone you share a health insurance plan with can count as a qualifying life event.

Changes in Residence

Moving: If you move to a different state, county, or zip code, you’ll probably be able to count this change as a qualifying life event.

Other Qualifying Life Events

• Becoming a member of a Federally-recognised indigenous nation
• Becoming a shareholder for the Alaska Native Claims Settlement Act Corporation
• Experiencing any change in income that alters your eligibility for coverage
• Beginning or ending service with AmeriCorps
• Gaining US citizenship or another form of lawful status you didn’t have before
• Becoming eligible or ineligible for subsidies under the Affordable Care Act
• Getting out of jail or prison

You can begin the health insurance application process within 60 days of a life-changing event taking place. Your coverage will generally start the month immediately following your decision on which plan you want.

Frequently asked questions