Endowment and Divorce

tinytina

My friend recently divorced and as part of her settlement the court awarded her the house and endowment. The endowment was a joint life first death endowment. At the moment it is assigned to a building society to pay off the mortgage at the end of the term.

What is she meant to do about the endowment policy? Should she leave it in joint names or does she need to tell the insurance company that it is just hers and does it cover her and her ex husband or her alone?

dunstonh

She should get it assigned to her. The building society dont need assignment any more so it should be straightforward. One letter from the B/S to the insurer saying they dont need assignment and then putting an assignment to her on the policy. Her legal representative should really have dont this for her or at least told her what to do. IFAs often get requests from solicitors to handle the paperwork on certain things for mutual clients.

silvercar

It still covers her and her husbands life, but she is the sole beneficiary. So if he pops his clogs she gets a payout, if she pops her clogs her estate benefits.

The ex may need a bodyguard

tinytina

So would her ex-husbands name stay on the policy and or does she need to have his name removed?

tinytina

whoops sorry, posted the question before I saw the second reply.

Many thanks, I will pass this information on to her

silvercar

tinytina wrote: »

So would her ex-husbands name stay on the policy and or does she need to have his name removed?

His name stays on the policy.

The policy was (I assume) a joint life, first death endowment policy. So at the end of the term, if no-one has died, the policy pays out whatever the investment has grown to over the 25(?) years.

If one of the two individuals does sadly pass away during the lifetime of the policy then the policy pays out the guaranteed death benefit. Generally this is the amount that the investment was intended to reach at the end of the 25 year term; many endowments aren't reaching that level.

All that has changed is that your friend is now the sole beneficiary of the policy so at the end of the term or on first death if sooner the policy pays out to your friend (or her estate) rather than to both of them jointly, or the survivor in case of a death.