Prenup – End of Relationship Insurance Policy
A Prenup (Contracting Out Agreement) is just like any other insurance policy that we take out. We all understand the importance of travel insurance, car insurance, health insurance, income protection insurance. We get these insurances with the hope that we never have to use them. We do everything we can to avoid having to use them but we know that sometimes there are circumstances outside of our control that means getting insurance is a really good idea.
A few years ago I took out income protection insurance never expecting that I would need to use it. At the time I was really healthy and even when I got sick, I was one of those people that would carry on working no matter how sick I felt. I was 100 % sure that I would never need income protection insurance but then one day I woke up and I was so sick, I ended up not being able to work for several years. The income protection insurance got me through a really tough time financially. If I had not had the insurance, I would have lost everything.
That is the same with a Contracting Out Agreement. You might have the most amazing relationship and you can’t imagine that it will ever end. You might be the most amazing person and no matter what happens, you are able to manage the situation and keep your relationship on track but you never know the future.
It’s not nice think about the worst-case scenario. I have lots of clients that I advise to get a will and they say, “I don’t want to think about death”. It’s not fun thinking about death but it’s really important to be prepared just like it’s not fun to think about what would happen if your relationship ended but it’s really important to be prepared (just in case). Even if you are 100% sure that your relationship will never end, you never know when one of you will pass away. It’s always good to prepare for the worse, e.g. what if you passed away tomorrow, are you sure your assets will pass to your children?
Most people wouldn’t leave New Zealand without travel insurance. They know that anything can happen and they want to be prepared for the worst-case scenario. They are sure that everything is going to be fine and that they are going to have the best holiday ever but they are prepared, just in case it isn’t fine. That’s the same with a Contracting Out Agreement, you are enjoying your relationship and you are going to have the best time together but it’s also good to be prepared, just in case.
Your Caring Relationship Property Lawyer, specialist in Contracting Out Agreements (PreNups)
