A new law goes into effect in Virginia on July 1, 2017, giving courts the authority to order a party paying spousal support to maintain an existing life insurance policy for the benefit of the payee spouse. This change to Virginia family law will come from a new statutory provision, Va. Code § 20-107.1:1.
The existing life insurance policies must be on the payor spouse’s life, not the payee spouse’s life. Additionally, the policy must have been issued during the marriage, through the insured’s employment, or be within effective control of the insured provided that the insured party has the right to designate a beneficiary during the marriage and the payee is a party with an insurable interest.
This new Virginia code provision effectively overrules the holding under Lapidus v. Lapidus, 226 Va. 575 (1984). In Lapidus, the Supreme Court held that nothing … Read More »
In many divorce cases, the most valuable asset to be divided is a pension. Pensions, or “defined benefit plans,” pay retirees a specified recurring benefit upon retirement that the retiree receives for life. Examples of defined benefit plans are the Federal Employees Retirement System (FERS), Virginia Retirement System (VRS), and military retirement benefits. Two main characteristics of pensions make them so valuable: first, the payments received can add up to hundreds of thousands of dollars throughout the life of the retiree; and second, the pension pays its benefits in regular (usually monthly) intervals, creating a guaranteed stream of income for the recipient.
Another feature of defined benefit plans is that they only provide the benefit to the retiree—when the retiree passes away, all benefits cease. This is generally of no concern to a retiree in a divorce proceeding. But a former spouse could … Read More »