Three Ways to Protect Your Personal Injury Settlement in a Divorce

Couples file for divorce for numerous reasons: adultery, cruelty, and disconnect. Laws regarding divorce vary by state, though some courts will grant a divorce on the grounds of irreconcilable differences, irretrievable destruction of the marriage or simply incompatibility.

Besides the inevitable heartbreak, the most significant issues resulting from divorce include:

  1. Alimony payments.
  2. Custody and visitation arrangements as well as child support payment schedules.
  3. Division of property can lead to issues in an otherwise smooth divorce proceeding. Courts usually ponder a few factors when discussing dividing property:
    1. Presence or lack of a prenuptial agreement.
    2. Property acquired prior to marriage.
    3. Each spouse’s individual contributions to the joint estate.

Personal Injury Settlements and Divorce

A personal settlement awarded during divorce proceedings may become contested property. Several criteria are considered by the court to decide whether an asset should be considered marital or nonmarital. This is how it is usually considered:

  • Whether the divorcing couple in a state favoring community property or equitable distribution.
  • Some courts designate personal injury settlements as the property only of the individual it was awarded to.
  • Sometimes the settlement gets broken down to determine how much each spouse should get and how much the personal injury victim can keep without sharing with their spouse.

The best way to prepare for any of these scenarios is to consult a divorce law attorney. They can provide insight into how the court will handle your settlement award.  


Three Methods to Protect Your Personal Injury Settlement in Divorce

  1. Get spousal consent to not claim all or a portion of your settlement. Especially if you live in a community property state, it is important to get the spousal consent in writing, dated, signed and notarized for legal purposes. This document can be incredibly valuable to you if the divorce becomes contentious.  
  2. You could open a separate bank account for the award of your personal injury settlement. In some jurisdictions, the award will be considered marital if you deposit it into a joint checking account. Keep your award in the separate account until the court has made a decision regarding asset distribution or when the divorce is finalized.
  3. Differentiate what percentage of your awarded damages belongs to you or your spouse and consider a Maryland personal injury lawyer’s guidance in discussing your asset distribution and personal injury claim.


Your divorce attorney is your best asset during proceedings. They can best advise you on your unique circumstances regarding your personal injury settlement and your asset distribution.

Thanks to our friends and contributors from the Law Firm of Frederick J. Brynn for their insight into personal injury practice.


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