Rebalancing Beneficiaries Support Insurance (RBSI) secures Separation Agreement or Court Ordered support payments for Child Support & Spousal Support / Alimony, in a fair manner for both parties. It was created specifically for Family Law.
There are 4 primary types of support payments:
- Child Support – The monthly amount varies by family based on incomes of the parents, the number of children in the family, which parent each child resides with, the approximate amount of residential time with each parent, and the children’s ages, etc. Calculating Child Support can be simple or quite complex, depending on specific circumstances in that ex-family. Always consult a Family Law Professional when determining Child Support Payment calculations.
- Children’s Special Expenses – Once Child Support is calculated, moms and dads need to consider other shared expenses for their children. In Canada, the government calls them Section 7 Expenses. There are different names and laws in each country, but they are still special expenses. The main categories of expenses are: Child-Care Expenses, Healthcare Expenses that exceed $$$ annually, Uninsured Medical Expenses such as a child’s portion of a medical insurance plan, Primary and Secondary School or Other Educational Expenses, Post-Secondary School Expenses, and Extracurricular Activity Expenses. For Support Insurance it’s important to budget for Future Educational Expenses such as College or University Expenses. These can be significant expenses. Giving your children an opportunity to get an education, to enhance their future employment opportunities, is good parenting.
- Spousal Support / Alimony – is a complicated calculation that requires considerable legal expertise to determine the exact amount owed each month and for how many years. Typically, there are several ranges (Low, Mid, High). Length of Marriage or Cohabitation plays a significant role in the calculation as does historical and current incomes of both parties. For long-term marriages Spousal Support / Alimony can be for an indefinite period and possibly for life, depending on agreements and jurisdiction.
- Other Debt Repayments – Often, there’s money owed by one of the parties to the other when couples separate, for a variety of reasons. The amount owed should also be secured with Life Insurance.
Once you have legal advice and after an agreement is reached between the parties or is Court Ordered, it’s always recommended to secure all future Support Payments with Life Insurance. Rebalancing Beneficiaries Support Insurance (RBSI) is the perfect Family Law Support Insurance Program. There are 4 specific advantages of RBSI:
- When Support Payments are received by the Support Beneficiary the amount of life insurance benefit decreases (what is still owed for support as agreed to or Ordered). An equal amount to the payments received increases on the Insurance Company’s Beneficiary Schedule for other beneficiaries such as children or a new partner or new spouse, etc. Hence, the Insurance payout, if the Policy Owner passes away, rebalances the beneficiaries payout amounts.
- “Irrevocability” is a term often used with life insurance policies. It can be important for the beneficiary. However, it’s also important for the Support Payor. RBSI converts to revocable at the conclusion of the agreed to Support Period. This is important in Family Law for numerous reasons.
- “Notifications,” if agreed to between the parties, allows the Support Beneficiary to be notified if the Support Insurance Policy will lapse from non-payment. Just imagine a support payor passing away unexpectantly and without Support Insurance to secure support payments. Most Separation Agreements and Court Orders provide some legal direction, but RBSI solves this issue, which can be significant.
- Each ex-family has different ages of children, financial circumstances, etc. Rebalancing Beneficiaries Support Insurance (RBSI) secures even the most complicated Family Law situations. The Support Beneficiary’s amount can be rebalanced based upon specific legal requirements. Rebalancing Beneficiaries, such as a child with special medical needs, can have a specific amount added to the policy over and above the rebalancing amount. Critical Illness Insurance can be added to ensure support payments are made in a timely manner if the Support Payor has a critical illness.
Once you know the amount of Support Payments owed, the agreed period for the support payments and you have budgeted for your children’s future expenses, calculate the amount of life insurance you require. Do not forget to apply Cost-of-Living Adjustment (COLA) to adjust for future inflation during the full agreement period.
Rebalancing Beneficiaries Support Insurance (RBSI) is the only Support Insurance Program created specifically for Family Law. Give us a call or request a specific quotation. Come To Agreement’s RBSI Program is underwritten by some of the largest Life Insurance Companies.
Remember…
When Children Do Well, Parents Do Well
When Parents Do Well, Children Do Well
