Insuring the Road to Splitsville: Does It Make Sense?

Insurance companies offer wedding insurance, but insurers might also want to provide married couples with divorce insurance just in case the best made plans don't work out, suggests J. Christopher Westland, a professor of "information and decision sciences." This University of Illinois educator has been hard at work projecting the actuarial tables for just such an eventuality.

And all too eventual it is, too. About two million Americans get married each year and about half get divorced: 20 percent in the first five years and 30 percent by 10 years. The divorce process could take years, during which time two households may have to be maintained and attorney fees have to be paid. These financial pressures can cause loss of income, he warns.

Westland envisions a policy costing $2,500 a year for coverage worth $200,000, but that could vary, he says in a National Underwriter article.

The Illinois professor identified several "risk factors" associated with divorce that would help insurers figure out who would get it and how much it would cost. These include age, as being younger is riskier; race, as Asians have the lowest rate; and whether a woman is working in an urban environment, as this offers more opportunities. A more highly educated woman is less likely to divorce early in marriage, but more likely to do so later.

Westland's critics say his idea will never get to the altar. Divorce is not a "fortuitous event" like an earthquake or hurricane. It's a matter of choice, which presents a "moral hazard." In other words, couples choose whether to get divorced, or whether to do the things that get them divorced, such as living la vida loca in Las Vegas or smashing the spouse's Cadillac Escalade with a golf club. And knowing that you have $200,000, or more, at your disposal if you land in divorce court could make it more likely that you will.

Westland says the way around this is to have a "blackout period," maybe two or more years after you get married and buy the insurance before untying the knot.

But buying divorce insurance when you get married is somewhat like drawing up a pre-nuptial agreement. You're hedging your bet in case till death do us part comes apart. Where's the love?