Frequent Flyer Points and Divorce: Who Gets What?

When people think of addressing a property settlement in light of their separation, they often think of addressing items such as the family home, cars, bank accounts and the like. However, a less commonly considered asset that can be divided as part of a family law matter are frequent flyer points.

To the surprise of many, notwithstanding the fact that frequent flyer points do not necessarily hold a dollar-for-dollar value, they can still be considered to be an asset available for distribution following a separation.

At the outset, it is firstly important to research whether your specific frequent flyer airline allows flyers the ability to transfer points to another person. Airlines will generally stipulate in their terms and conditions whether points are able to be transferred across from one account to another, and whether there is any cap as to the number of points that can be transferred.

One reason that it can be a more difficult task to address frequent flyer points within a property settlement, is due to the fact that valuing the points for the purposes of a balance sheet can be quite difficult. It is not often that frequent flyer points have a set dollar-per-point conversion value and as such, parties are often left with the difficult task of trying to prove or evidence what they assert the estimated cash value of their frequent flyer points are.

If the parties or one party only holds a nominal amount of frequent flyer points, it might not be beneficial to include such points in the pool of assets available for division. However, if a significant number of frequent flyer points are held, it certainly may be worth trying to ascertain what their monetary value might be.

Once it is ascertained what the frequent flyer points may be worth for the purposes of the balance sheet, parties are able to negotiate their property settlement bearing in mind that such points form part of the asset pool and it may be appropriate for a portion, if not all of the frequent flyer points be transferred to the other party. Otherwise, in the event that one party seeks to retain the entirety of the frequent flyer points that they may have held in their sole name prior to separation, an adjustment may need to be made with respect to the division of the remainder of the pool of assets to the other party, to account for that person retaining all of the frequent flyer points.

Should you require any assistance in your family law matter, please do not hesitate to contact us on (02) 9523 5535. We are more than happy to help, and our extensive experience in family law matters enables us to provide a high quality service designed for your needs.