LOS ANGELES, CA--(Marketwire - November 3, 2010) - Just weeks after the launch of the nation's first divorce insurance, Los Angeles Divorce Attorney Mark Baer is cautioning 'would be' insureds to think carefully before investing in this novel insurance; the consequences may very well outweigh the benefits and destroy the sanctity of marriage.
Over the years he's practiced law, Attorney Baer has helped hundreds of couples dissolve their marriages with the goal of causing the least amount of damage to their families. As a mediator, a collaborative law attorney and an experienced litigator, he often employs mental health professionals to assist in diffusing emotions during a divorce proceeding. With that in mind, Baer says divorce insurance removes the motivation for couples to work through their problems in a constructive manner. Baer believes that the only true beneficiary of divorce insurance is the divorce insurance company, itself.
This novel insurance became available for the first time in America on August 5, 2010, with the launch of the online insurance website, www.WedLockDivorceInsurance.com. The company sells individual policies which can be purchased in units with coverage ranging from $1,250.00 per unit to a maximum of 200 units or $250,000 in coverage. After 48 months (four years) the policies mature but insureds can purchase additional riders at $30.00 per unit to reduce the waiting period to 36 months (three years). If a marriage should fail after the policy matures, the couples walk away with a cash payment equivalent to the amount of coverage purchased.
After reviewing the entire package, Attorney Baer calls divorce insurance, "an entirely negative concept and a bad idea." Says Baer, "Studies show that people who negotiate a pre-marital agreement may have stronger marriages than those who don't as the process of creating the agreement acts as a form of premarital counseling. However, divorce insurance provides no such benefit. When couples hit hard times, instead of working to correct these problems, divorce insurance will motivate them to seek an ending to their marriage to get a return on investment, ultimately promoting divorce."
He adds, "If you are buying divorce insurance because you think the marriage is going to fail, how successful of a marriage are you going to have?"
From the financial perspective, even with the high cost of divorce today, Baer says divorce insurance does not seem very cost effective. "If a standard policyholder, who purchased 10 units divorced after 10 years, they would have paid over $19,188 in premiums. The insurance company would pay them $27,500, which would be taxed over the amount of their premium payments. To receive this settlement, they would have to be divorced, which could cost $30,000 on the average to well over $100,000, per attorney, on the high end where there are issues of child custody, retirement, business or property ownership to resolve."
Depending on the statistics you use, 40 to 50% of first marriages end in divorce. So 50 to 60% of those who purchase divorce insurance will never see a return on their investment and will lose everything they have paid-in. On the flip side, for those 'lucky enough' to capitalize on their investment by divorcing, there would be costly legal fees and a break-up of their family structure.
Based on the overall costs and losses to the family structure, Baer says, "I would strongly suggest that someone re-evaluate entering into a marriage or remaining married to someone who is inclined to purchase divorce insurance."
Mark B. Baer has practiced law in Los Angeles for nearly twenty years with an office in Pasadena, CA. His firm represents individuals on issues regarding family law, divorce, child custody, child support, spousal support, restraining orders, paternity actions, or domestic partnerships. For more information, please visit: www.markbaeresq.com. To read blog articles, please visit: http://www.markbaeresq.com/Pasadena-Family-Law-Blog.aspx.
Contact Information:
For more information, please contact:
Mark B. Baer, Esq
(626) 389-8929
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