Are Private Disability Insurance Policy Payments Marital Property?

Our Second District Court of Appeals looked at that issue in the Gibbons case decided last month. See Gibbons v. Gibbons, 10 So. 3d 127, (Fla. 2d DCA 2010). In that case the Husband who had been an attorney became disabled prior to the filing of the divorce action. As a result of his disability he received payments from 3 disability insurance policies he purchased and paid for during the marriage. One of the policies ended payments when he reached the age of 65 while the other 2 policies did not. The 2 other policies continued payment with no set end date as long as the Husband remained disabled. The Wife argued at trial that since the Husband would be receiving payment from the 2 policies after he reached the age of 65 the payments were akin to retirement payments and therefore subject to equitable distribution. The lower agreed with her and awarded her 1/2 the value of the 2 policies in question.

The appellate court disagreed and reversed the trial court's decision. The appellate court held that there was no evidence that the payments made to the Husband after age 65 contained a retirement component and were subject to the condition that he remained disabled; therefore the payments was the Husband's separate income and not subject to division.