Does Divorce Affect Life Insurance and Beneficiary Designations in Ontario?

Do not assume that divorce has removed your ex-spouse as a beneficiary on your life insurance or RRSP. Whether a designation changes depends on the document and the law that applies, so check each one, update it yourself and ask a lawyer if you are unsure.

The revocation that is clear applies to wills. If you divorce after making a will, gifts to your former spouse and their appointment as executor are revoked, and the will is read as if the former spouse had died first, unless the will shows a contrary intention. The same revocation applies if the spouses were separated at death, meaning they had lived apart because of the breakdown for 3 years, or had a separation agreement, court order or family arbitration award and were still living apart, where the separation event is on or after January 1, 2022.

Retirement savings can also move between spouses. An unmatured RRSP can be transferred to a current or former spouse's plan on Form T2220 when the spouses live apart because of a breakdown and the transfer is under a court order or written separation agreement. Gather your policy and plan documents and review every beneficiary and executor choice after separation.