Watch your finances at your wedding… and divorce

The flush of love or the bitterness of its loss affects us deeply, building us up or blowing us down. In the midst of the emotional intensity, few of us think about the financial implications of the heart’s whims, but it is worth keeping a few things in mind.

The Association of British Insurers (ABI) has warned couples that once they have tied the knot, they need to make sure there is no slack in their home contents insurance.

Malcolm Tarling, spokesperson for the ABI, said that some policies are prepared to take weddings into account, but that they often make only temporary adjustments.

He said: “In the month before and the month after, you may find automatically your sum insurance may rise by, say, ten per cent. The exact percentage rise will depend on the policy of course, but many policies do take this into account.”

Responsibility for making the change to your policy is entirely yours. It would be wise to assess the value of your household contents and then increase the sum insured, even if it does mean an increase in the premium, he added.

Re-valuing the value of your content is a good idea not only because your possessions have doubled as you and your spouse join forces, but also because of the gifts you receive at your wedding.

Graeme Trudgill, manager of technical services at the British Insurance Brokers’ Association (Biba) said: “Before you got married, you probably had £20,000 worth of stuff and one toaster. But after you get married you receive lots of wedding presents, jewellery, and seven toasters, so it’s very likely that you’ll just need to review what cover you have.”

He stressed that with parents giving their children gifts that will help them in life, it is important that those are covered otherwise, if misfortune strikes, they could be lost forever.

Newlyweds may also swan off to their honeymoon with some of their newly found riches. Heirlooms, jewellery and cameras are among the gifts that the happy couple are likely to fly off with straight from the ceremony.

Mr Trudgill said that the couple should be careful to insure any gifts that they take with them after their nuptials as part of re-valuing their policy.

“There will be maximum limits for certain things … you might have a maximum of £3000 for anything that’s taken out of the house. So, if you go abroad on your honeymoon, you need to make sure that if you’ve been given a £5,000 necklace or something, that that’s going to be covered.”

He also warned that the rush of emotions surrounding the occasion lead to neglecting essential elements of the journey.

“[As] you’re probably going on a honeymoon … travel insurance is as important as your suitcase. Don’t go without it, whatever you do.”

He advised that even having a European Health Insurance card is not enough for while it may cover some unforeseen medical expenses it will not cover you if the honeymoon is cancelled or if you break your leg.

It is also vital to take hold of your finances if and when the dream dies and instead of putting on rings, they are being thrown around, not least because as research by Birmingham Midshares has shown that the majority of Brits do not have the savings to deal with a sudden change of circumstances.

Also, Chris Tapp, associate director for consumer assistance charity Credit Action, said that problems arise when one of the partners is liable for the debt.

He said: “Where you have couples borrowing and then there’s a divorce, you can get very serious problems because there’s such a drop in income. So it’s important that people make sure they’re notifying both the creditors and the credit reference agencies, so it’s going to appear on people’s credit ratings as to why that’s happened, so that can be taken into account.”

According to Mr Tapp, informing the credit agencies at an appropriate time means that a note can be made next to your references so that your situation is taken into account.