Safeguarding Spousal Maintenance with Life Insurance and Beyond | Episode 193

Securing Spousal Maintenance with Life Insurance in a Colorado DivorceIn this how-to episode of Divorce at Altitude, Ryan Kalamaya explains an important but often overlooked issue in Colorado divorce cases involving alimony: how to secure future spousal maintenance payments if the paying spouse dies or otherwise cannot pay. Using the hypothetical divorce clients Eric and Melanie Wolf, Ryan walks through what happens after a maintenance award is entered and why simply having a court order for monthly support is not always enough protection.Ryan begins with a common scenario: Eric is ordered, either by agreement or by the court, to pay Melanie $5,000 per month for 10 years. That may sound straightforward, but it raises a critical question—what happens if Eric dies one year into the maintenance term, or even the day after the divorce is finalized? Because Melanie’s financial security may still depend on those future payments, Colorado law allows courts and parties to put protections in place to secure the unpaid balance of the maintenance award.Episode HighlightsWhy Maintenance Security Matters A spousal maintenance order may require payments for years, but that award can become meaningless if the paying spouse dies or becomes unable to pay.Life Insurance as the Most Common Tool Life insurance is often the easiest and most cost-effective way to secure future alimony obligations in a Colorado divorce.Other Ways to Secure Maintenance Courts and parties may also use real estate liens, trusts, investment accounts, bank guarantees, or lines of credit.Colorado Law Allows Security for Support Under Colorado law, courts can consider whether future maintenance payments should be protected through a financial security arrangement.Key Factors Courts Consider The court may look at the paying spouse’s age, health, insurability, cost of insurance, other obligations, and whether life insurance already existed during the marriage.Short-Term vs. Long-Term Awards A short maintenance award for a healthy younger spouse may not justify life insurance, while a longer award with older or less healthy spouses may.What is Divorce at Altitude? Ryan Kalamaya and Amy Goscha provide tips and recommendations on issues related to divorce, separation, and co-parenting in Colorado. Ryan and Amy are the founding partners of an innovative and ambitious law firm, Kalamaya | Goscha, that pushes the boundaries to discover new frontiers in family law, personal injuries, and criminal defense in Colorado. To subscribe to Divorce at Altitude, click here and select your favorite podcast player. To subscribe to Kalamaya | Goscha's YouTube channel where many of the episodes will be posted as videos, click here.  If you have additional questions or would like to speak to one of our attorneys, give us a call at 970-429-5784 or email us at [email protected].************************************************************************DISCLAIMER: THE COMMENTARY AND OPINIONS ON THIS PODCAST IS FOR ENTERTAINMENT AND INFORMATIONAL PURPOSES AND NOT FOR THE PURPOSE OF PROVIDING LEGAL ADVICE. CONTACT AN ATTORNEY IN YOUR STATE OR AREA TO OBTAIN LEGAL ADVICE ON ANY OF THESE ISSUES.