How to Address Life Insurance in a Prenup

Apr 14, 2023 | Clauses, Prenuptial Agreements

Is there a more fun topic than insurance?! Kidding! Life insurance is often overlooked in a prenup but don’t be fooled; it’s really important! While talking about life insurance may seem morbid, it’s a huge part of being financially savvy, and it can really give you peace of mind for the worst-case scenarios. 

You can add a life insurance clause to your prenup, which can help protect yours and your spouse’s financial interests if the worst is to happen. How you ask? Well, by adding a life insurance clause, you are legally requiring your partner to maintain a life insurance policy for YOUR benefit for a certain amount (or vice versa). Adding a life insurance clause to your prenup does not automatically create a life insurance policy but instead mandates that you and your partner go seek one out from an insurance provider. In this blog, we will dig deeper into this topic and explain how to address life insurance in a prenup.


Understanding prenups

Before we dive into the specifics of including life insurance in a prenup, let’s first take a look at what a prenuptial agreement is. A prenup is a contract between two lovebirds who are about to get married. It typically outlines how the couple’s assets will be divided in case of a divorce or, sometimes, death. Prenups are not just for the wealthy; they can be beneficial for anyone who wants to protect their assets in case of a marriage breakdown.

Now, one thing to understand is that there are many things that can go into a prenup. Division of assets is a big one, but there are a plethora of other clauses that can go into a prenup, from confidentiality clauses to life insurance clauses. 

Importance of life insurance in a prenup

One aspect that is often overlooked in prenuptial agreements is life insurance. Many couples believe that they don’t need to include life insurance in a prenup because they already have life insurance policies in place. However, including life insurance provisions in a prenup can help ensure that both parties are financially protected in the event of the unexpected death of one of the spouses. How? Well, by requiring life insurance in a prenup, you are legally solidifying the expectation that life insurance is to be maintained throughout the marriage. You may have the life insurance policy in place now, but what if they want to cancel it two weeks after the wedding? Putting a life insurance clause in your prenup is just an extra layer of protection, ensuring that you (or your partner) will be protected in the worst-case scenario (one of you dies). 

President & CEO of Francis Financial and Savvy Ladies, Stacy Francis, CFP®, CDFA®, CES™ shares that,  “More and more Americans are signing prenuptial agreements every year, and a key piece to those agreements should be life insurance. Neglecting to include provisions for life insurance in a prenup leaves too much to chance. By including life insurance, you are taking a big step towards protecting yourself and those you love in the event of an unexpected tragedy.”

Types of Life Insurance

Let’s talk about the different types of life insurance: permanent and term life insurance. Term provides coverage for a specific period of time, while permanent provides coverage for the insured’s entire life.

Deciding on Life Insurance Coverage

When including life insurance provisions in a prenup, it’s important to determine the appropriate amount of coverage. Remember, including a life insurance policy in your prenup does not automatically create a policy. You can add a requirement for life insurance, but then you must actually go out and get the policy from an insurance provider. How much coverage you get may be dictated by what you put in the prenup. 

So, what should your coverage be? This will depend on a variety of factors, such as your income, assets, and financial obligations. In general, it’s recommended that the life insurance policy’s death benefit should be enough to cover any outstanding debts, funeral expenses, and ongoing financial needs of the surviving spouse and any children.

Naming Beneficiaries

When including life insurance in a prenup, it’s important to name the beneficiary of the policy, which is typically the other spouse. This is the person who will receive the death benefit in the event of the insured’s death. In most cases, the surviving spouse is named as the primary beneficiary. 



Drafting the life insurance provisions

You will typically not need to worry about drafting anything when you hire a professional platform like HelloPrenup or an attorney, but it may still benefit you to understand what’s going on. When drafting the life insurance provisions in a prenup, it’s important to be clear and specific about the terms of the policy. This should include the type of policy, the amount of coverage, the beneficiaries, and any other relevant details. It’s also important to include when the requirement for life insurance ends (i.e., the requirement to maintain life insurance should end when the marriage ends). 

Seeking legal expertise 

Drafting a prenuptial agreement that includes life insurance provisions can be complex. It’s important to seek out professionals, such as a qualified attorney and/or utilizing HelloPrenup’s state-compliant prenup platform, both of which are knowledgeable in drafting prenups. Utilizing professionals can help ensure that the provisions are legally enforceable. 

Example scenario to help you conceptualize

We get it, finances, legal topics, morbid scenarios, it’s dense! We’ve parsed out some examples for you to help get the brain juices flowing and make sure you fully understand this concept! 


John is frequently deployed overseas with the military, and he is engaged to Kate, who is a teacher. They have two small children together. John and Kate are planning on getting married soon and want to get a prenup. One of the things Kate is most concerned with is John’s risky job and the worst-case scenario of him dying overseas while on deployment. She learns about the possibility of a life insurance clause and thinks this will give her great peace of mind knowing she would be able to support herself and their two children if John was to die. So, they get a prenup, and they add in a life insurance clause that mandates John maintain a life insurance policy, with Kate as the beneficiary, for a death benefit of $100,000. This money would help Kate cover any debts, funeral expenses, and other miscellaneous costs if anything were to happen. They execute the prenup, and John goes straight to an insurance provider to make sure he is compliant with the prenup terms. John sets up the insurance policy according to the prenup, and they live happily ever after!

Frequently Asked Questions (FAQs)

Still confused about how to address life insurance in a prenup? No worries, we’ve put together a few of our frequently asked questions regarding prenups and life insurance below.

Q: Do I need a prenup if I have life insurance?

A: While life insurance can provide financial protection in the event of your spouse’s death, it does not protect you in a divorce. The short answer is: yes; you may still need a prenup even if you also have life insurance. Why? Because life insurance only kicks in when your spouse dies. What happens in the event of a divorce? You may not be financially protected in a divorce even though you have great life insurance coverage.


Q: Does adding a life insurance provision automatically create a life insurance policy for me? 

A: No! Adding in a life insurance provision to your prenup simply means you and your partner agree to GET a life insurance policy of a certain death benefit. The act of putting the clause into the prenup itself does not automatically create a life insurance policy; you need to actually contact an insurance provider and get it set up.


Q: What should be considered when addressing life insurance in a prenup?

A: When addressing life insurance in a prenup, couples should consider the amount of coverage needed, the beneficiaries, and the duration of the policy. They should also consider how the premiums will be paid, whether by one spouse or both and how the death benefit will be distributed.


Q: Why is life insurance added to a prenup?

A: Life insurance is often included in a prenup to ensure that the surviving spouse will have financial support in the event of the other spouse’s death. By outlining the terms of a life insurance policy in the prenup, couples can protect each other financially and prevent any disputes from arising.


Final Thoughts

In conclusion, addressing life insurance in a prenup can provide important financial protections for both partners in a marriage in case of death. By clearly outlining the terms of a life insurance policy in the prenup, couples can ensure that their surviving spouse will be provided for in a worst-case scenario situation. We know, we know, not the most bright and lively topic to discuss, but it’s important! 

You are writing your life story. Get on the same page with a prenup. For love that lasts a lifetime, preparation is key. Safeguard your shared tomorrows, starting today.
All content provided on this blog is for informational purposes only. HelloPrenup, Inc. (“HelloPrenup”) makes no representations as to the accuracy or completeness of any information on this site. HelloPrenup will not be liable for any errors or omissions in this information nor for the availability of this information. These terms and conditions of use are subject to change at any time and without notice. HelloPrenup provides a platform for contract related self-help. The information provided by HelloPrenup along with the content on our website related to legal matters (“Information”) is provided for your private use and does not constitute legal advice. We do not review any information you provide us for legal accuracy or sufficiency, draw legal conclusions, provide opinions about your selection of forms, or apply the law to the facts of your situation. If you need legal advice for a specific problem, you should consult with a licensed attorney. Neither HelloPrenup nor any information provided by Hello Prenup is a substitute for legal advice from a qualified attorney licensed to practice in an appropriate jurisdiction.


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