Division of Life Insurance Upon Divorce
National Legal Research Group, Inc.)
Attention: the information on this page pertains to the following case analysis: In re Marriage of Day, 31 Kan. App. 2d 746, 74 P.3d 46 (2003). It is recommended to read this case analysis for a full understanding.
The fact that the policies had no value did not necessarily require reversal of the trial courtís order. If the policies had no value, their division did not harm the husband. The court noted, however, that under Kan. Stat. Ann. 40-453(a) the person insured by any life insurance policy has an absolute right to insist that the insurer cancel the policy. Since the mother would probably exercise this right in favor of her son, the court saw division of the policy as a futile act. Moreover, while the court was reluctant to rely upon the wifeís lack of an insurable interest alone, it held that the lack of such an interest was at least one factor suggesting that the trial court abused its discretion. "We hold that requiring Robert to continue the policy or policies of life insurance on his mother is in effect requiring continuance of a wagering contract on her life and is contrary to public policy and constitutes an abuse of discretion." 31 Kan. App. 2d at 757, 74 P.3d 46 at 53.
The courtís conclusion that the wife lacked an insurable interest is probably very dependent upon the fact that the case involved a policy on the life of a third party. If the policy had been on the life of the husband, an insurable interest would surely have arisen if the wife received spousal or child support which terminated upon the husbandís death. In addition, had the wife received any right to a continuing distributive property division award, that right would probably have generated an insurable interest. In fact, if such an award was payable from the profits of the farm business (there is no indication of this in the facts), the wife might even have had an insurable interest in the life of the husbandís mother.
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