When Can a Court Order Life Insurance to Secure Alimony or Child Support?
A requirement that an alimony award be secured by life insurance is not mandated. Rather, “it is justified only if there is a demonstrated need to protect the alimony recipient.” Lapham v. Lapham, 778 So. 2d 487, 489 (Fla. 5th DCA 2001) (quoting Hedendal v. Hedendal, 695 So. 2d 391, 392 (Fla. 4th DCA 1997)). “[W]hen ordering a party to purchase life insurance, “the trial court must make specific evidentiary findings regarding the availability and cost of insurance, the obligor’s ability to pay, and the special circumstances that warrant the requirement for security of the obligation.” Foster v. Foster, 83 So. 3d 747, 748 (Fla. 5th DCA 2011); see also Alpha v. Alpha, 885 So. 2d 1023, 1033-34 (Fla. 5th DCA 2004). “The failure to make the necessary findings” to support an order requiring the maintenance of life insurance to secure the payment of alimony or child support “constitutes reversible error.” Id.
Moreover, “[t]he amount of insurance must be related to the extent of the obligation being secured.” See Burnham, 884 So. 2d at 392 (citing Zangari v. Cunningham, 839 So. 2d 918, 920 (Fla. 2d DCA 2003)). It is error, for example, for a trial court to require the obligated spouse to purchase a life insurance policy in an amount that exceeds his support obligation. See Beharry v. Drake, 52 So. 3d 790, 793 (Fla. 5th DCA 2010). Accordingly, the trial court must specify whether the insurance is security for unpaid support obligations, in which case only a portion of the proceeds are to be distributed to the beneficiaries upon the spouse’s death to minimize economic harm to the family. See Smith v. Smith, 912 So. 2d 702, 705 (Fla. 2d DCA 2005). In other words, the surviving spouse is not to receive a windfall, but merely the amount of her remaining support obligation.
Essentially, a Court must consider whether the death of the payor spouse would leave the payee spouse in dire economic circumstances. If the spouse receiving alimony also received a large equitable distribution award and has the ability to work, mandating life insurance is not appropriate as there is no dire economic need. See also Ruberg v. Ruberg, 858 So. 2d 1147, 1157 (Fla. 2d DCA 2003) (reversing security requirement in part because there was no basis in the record for concluding that former wife would face dire economic circumstances if former husband died).” Sweeny v. Sweeny, 113 So. 3d 987 (Fla. 5th DCA 2013).
Life insurance to secure support obligations can be extraordinarily expensive and burdensome to obtain. Trial courts must be cognizant of the special circumstances, which would warrant requiring a life insurance policy to secure support obligations and must make specific factual findings in order to do so.