Opinion ID: 2584589
Heading Depth: 4
Heading Rank: 2

Heading: Sheila's retiree health insurance benefits

Text: The trial court concluded that Sheila's lifetime health insurance benefits vested before the marriage and were therefore pre-marital property. Richard challenges this conclusion, arguing that Sheila continued to contribute to her retirement benefits with marital funds during the marriage and pointing to Sheila's monthly premium statements for support. However, the monthly premium statements provide no evidence that any portion of the monthly premium is being applied to anything other than that month's insurance coverage. Sheila responds that the correct interpretation of the monthly statement is that each employee payment of a monthly premium constitutes only a contribution to that month's coverage, not to the long term subsidy that the employer provides. Sheila's interpretation is better supported by the evidence in the record. Her expert testified that Richard could not have acquired an entitlement to post-retirement benefits unless he was married to Sheila on the date of her retirement under the state's benefit scheme. The expert also considered the premium payments made during the marriage and testified that no payment contributed to the value of Sheila's post-retirement benefit. Finally, the expert also testified that once an employee vests in the retiree health insurance program, the state of Alaska pays the subsidy amount for the beneficiary's health insurance from age of retirement forward. The expert testified that nothing was added to the value of that subsidy during Sheila's work during the marriage. Under our rule in Hansen v. Hansen, [27] post-marriage health insurance benefits acquired with marital funds are marital property. [28] The trial court distinguished Hansen on the ground that the evidence showed that none of Sheila's work during the marriage increased or contributed to the value of the health insurance benefits. Richard presents an alternative argument: that the entire retirement health insurance benefit should be seen as transmuted because he was listed as a health insurance beneficiary. But transmutation does not apply to retirement benefits, which are usually designated as partly marital and partly separate based on which portion was earned during the marriage. [29] Here, the evidence did not establish that any of the value of her post-retirement benefits was earned during the marriage. Because the factual finding that all of the value of Sheila's post-retirement health benefits were earned before marriage is supported by the record and not clearly erroneous, we affirm the trial court's conclusion that the health benefits are separate property.