Critical illness payout after divorce and possible impact on Universal Credit

[Catlover19]

Hi I'm looking for some advice, I've been divorced for 2 months. Two weeks after our divorce my ex found out he had stage 3 bowel cancer.
When he moved out last year I carried on paying the critical illness cover as due to health issue and age I couldn't get a new policy. I suggested he made a claim on the policy as his name is still
on it but I've been told that due to our divorce legally the payout will be 50:50.
I'm a working single parent and worried if I refuse the money so my ex gets it all I could loose my UC as I'm depriving
myself of capital. Im not sure what to do I can't afford to loose my UC. Thanks

Just give him your half?

Surely if you get half the payout, you won't need UC. You can claim again when you've spent enough of it to get back under the savings threshold.

That could be deprivation of capital. UC could count her as still having the money and make deductions or close the claim anyway

I can’t see any disregards for this payment therefore it will be counted as capital. 16k or more your UC claim will close 6-16 you’ll have deductions. The maximum you can have deducted it’s £169. You can’t give the money to your ex that could be deprivation of capital. If so UC could count the money as notional capital and still count you having the money.

Why are you proposing to give it all to him rather than splitting 50/50, is that just a moral choice on your part? Because the obvious solution would be to take the half you are entitled to.

It's a moral choice, financial it would make a big difference to me as I've took out a new mortgage which I'm will be paying till I retire.

Why would you keep any of the payout?
he must reimburse you for the premiums you paid on his behalf but that’s it

Exactly
there will be no disregard
you are divorced from the cancer sufferer

Could it just be paid directly to your ex? I’m struggling to see how it would show up on any kind of universal credit or banking system.

How was the policy taken out? Usually it’s a fixed amount that’s covered each month regardless of which policyholder makes the claim. So you should get the covered amount.

Well the post explains why: because there is a significant risk Universal Credit will judge that she has deliberately deprived herself of assets and dock her UC as if she has the money.

This would be sorted in minutes if there ever was a review

“we are divorced. He has been diagnosed with bowel cancer. The money was fully transferred to him”

case closed

I can’t answer the question but I just want to say how nice and refreshing it is to see you offering your ex the money

Hey- im a uc recipient and have just been paid a critical illness payment. It does not count for 12 months- and if you was to put it towards a mortgage it is not a deprivation. however I fail to see why you should get any other than premiums paid. Hes the one who could die and unlikely able to work? Can you have more of the other assets?

The policy has been running for over 20 years, the direct debit always came out of my account. My ex had no input sorting out bills he always left it to me as he's not very Computer savvy, so he wouldn't have a clue about critical illness or how to claim. Which is why I told about the policy and helped him do the forms and emails. So I'm not trying to take his money.

Op if there was a review
there’s SO much proof to indicate this is
NOT deprivation of assets

You are divorced
he has stage 3 bowel cancer diagnosis
these are indisputable facts

the case would be shut before it was barely opened

just give it to him all

it never occurred to me that the policy would be split, I only got in touch about the policy as he had received an email saying funds would go in to the account which pays monthly debit. I've also just received a notification of a UC review so having to send all statements in so didn't won't a large sum going in and out of my account. I'm trying to help my ex doing hospital runs, shopping etc but my priority is my children.

I would consult with CAB or another financial advice charity to see what course of action will be most beneficial to both you and your ex.

I don’t think it is as simple as case closed at all.

The insurance company are obliged to follow the terms of the policy and from what the OP has said, she is entitled to 50%. She can ask the insurance company to pay it fully to him but I would expect they would refuse to do this.

What kind of review are you havinf? UCR? Enhanced? Compliance?

If the 50% goes to you then you come off universal credit and then go back on it when you actually need it. Why is this an issue?

i didn't know there was different reviews, I've only been claiming since December so this is the first time I've had a review, they just asked for 4 months statements

Apologies if I’ve misunderstood but was it a joint policy? You said you kept it in place as due to age and health you can’t get a new one. Does this now mean that you have no critical illness policy or protection for your own mortgage? If this is the case, and obviously considering your ex’s need and situation, it seems wise to at least consider taking some of the money towards your mortgage if allowed, and any possible longer term implications for you if you don’t.
I’m sorry to hear about your ex and hope he recovers fully. I also understand that if he needs all the money to support him through this then that is a different situation altogether. It can’t be an easy time for any of you.

You can pay it towards mortgage. That is not ddeprivation.

How old are the children? Was he paying much child maintenance before he was ill? Could you keep the 50% and then he doesn’t have to pay you child maintenance? That would possibly be a weight off both your minds if your DC are young.

(You just don’t get to also have UC),