Court Opinion

ID: 4968094
Source: CourtListenerOpinion
Date Created: 2021-09-24 16:26:29.571704+00
Date Added: 2024-06-11T08:16:21.693644
License: Public Domain

DISSENTING OPINION BY
DONOHUE, J.:
I agree with the learned Majority that payments made pursuant to an insurance policy do not fit within the exception to the definition of marital property codified at 23 Pa.C.S.A. § 3501(a)(8) (exempting from marital property “[a]ny payment received as a result of an award or settlement for any cause of action or claim which accrued prior to the marriage or after the date of final separation regardless of when the payment was received.”). As the Majority recognizes, the right to a tort or workers’ compensation award is based upon the occurrence of an event that gives rise to an actionable claim, and our law provides that if that event occurs during marriage, any proceeds received as a result thereof will be deemed a marital asset. Maj. Op. at 705-06. The Majority also recognizes that benefits received pursuant to an insurance contract cannot be likened to “payments received as a result of an award or settlement for any cause of action or claim” because one does not contract for a tort or workers’ compensation award, but one does pay for the right to receive insurance benefits. Id. I depart from the Majority in its conclusion that insurance benefits received by Husband after the parties’ separation should be treated as income to Husband and not as marital property.
In my view, the salient inquiry is whether the premium payment preceding the *707filing of a claim was made during marriage with marital funds. That is because the Divorce Code provides that with a few exceptions, all property purchased by either party during the marriage will be deemed marital property. 23 Pa.C.S.A. § 3501(a) (“As used in this chapter, ‘marital property’ means all property acquired by either party during the marriage[.]”). As such, if an insurance policy is purchased during marriage, it is no different from any other marital property.1 The proceeds received from this marital asset must also be deemed marital property.
Support for this position is found in Schubert v. Schubert, 580 A.2d 1351, 1352 (Pa.Super.1990). In that case, the wife argued that the trial court erred in excluding proceeds from two life insurance policies from the marital estate. Both of the policies were purchased by the husband during marriage through his employer, named him as the only beneficiary, and were taken on the life of the parties’ daughter, who died five months after the parties separated. The wife argued that the proceeds from these policies were marital property because they were purchased during marriage with marital funds. Id. at 1354. We agreed, concluding that although the right to receive benefits under the policies accrued to the husband after separation, wife was “entitled to a share of the proceeds of the aforementioned insurance policies [because] the policies were not only purchased but maintained with marital funds.” Id. at 1355; see also DeMasi v. DeMasi, 366 Pa.Super. 19, 530 A.2d 871, 885 (1987) (finding insurance policy proceeds received after separation on policies purchased during marriage are marital property).
Further, in the case at hand, the fact that Husband must be re-evaluated yearly does not alter my position, as I do not view the yearly determination of Husband’s disability — or his initial claim under the policy, for that matter — as the critical point in time for our inquiry. As stated above, in my opinion the critical inquiry is whether the insurance policy under which Husband submitted a claim was purchased with marital or non-marital funds. I see the yearly evaluations as necessary only to determine whether the benefits under the policy will continue or terminate. Unlike a situation in which the insurance policy benefit is paid in a lump sum (such as with life insurance), the policy at issue provides that Husband will receive benefits for as long as his disability persists.2 See Disability Income Policy at 3 (indicating a maximum benefit period of life where, as here, Husband suffers total disability before the age of 65). Tying the determination of whether the benefits are marital to the nature of the funds used to purchase the policy allows us to treat this insurance policy (or any insurance policy that is in benefit status) similarly to all other marital property under the Divorce Code.
It is undisputed that the policy at issue was purchased during the marriage, and that the 2007 premium for this policy— that is, the premium paid prior to Husband’s submission of a claim — was paid for with marital funds. Thus, the policy is indisputably marital property, and so I *708would find that all payments made thereunder, no matter when they are received by Husband, are subject to equitable distribution. Therefore, I respectfully dissent.

. Indeed, this Court has recognized that the cash surrender value of a life insurance policy is marital property subject to equitable distribution. See Fexa v. Fexa, 396 Pa.Super. 481, 578 A.2d 1314, 1319 (1990); Lindsey v. Lindsey, 342 Pa.Super. 72, 492 A.2d 396, 399 (1985).

. Should the insurance company deem Husband no longer disabled, it will cease to pay benefits under this policy and this marital asset will cease to exist. To insure that he receives the same type of coverage should he become disabled again, Husband would have to purchase a new policy.