Every couple in Israel is subject to some property regime, even if they have never signed a document. The difference is whether that regime is set by law or by an agreement the couple chose themselves. To understand what a prenup changes, it helps first to understand what applies to you without one.
Couples married from 1974 onwards: balancing of resources
Couples who married on or after 1 January 1974 are subject to the Spouses (Property Relations) Law. Under the law, unless there is a property agreement, the resource-balancing arrangement applies: when the marriage ends, by divorce or death, each spouse is entitled to half the value of both spouses’ assets, after deducting debts. Excluded from the balancing are assets each spouse owned before the marriage, assets received as a gift or inheritance, as well as National Insurance benefits and compensation for personal injury.
During the marriage each spouse remains the owner of what is registered in their name. The balancing takes place only at the end, unless conditions are met that allow it earlier, for example when a year has passed since divorce proceedings began.
Couples married before 1974: the community property rule
Long-married couples who married before 1974 are subject to the community property rule established in case law. Under it, assets accumulated through joint effort during a normal shared life are considered jointly owned, regardless of whose name they are registered in.
Cohabiting couples
The Property Relations Law does not apply to cohabiting couples. On separation, the court mainly examines whether there was an intention to share a particular asset, based on the couple’s conduct. This leaves a great deal of room for dispute. See our article on cohabitation agreements in Israel.
What does a prenup change?
A properly approved property agreement overrides the statutory arrangement. It can provide for full separation, full sharing, or anything in between: for example, that one spouse’s apartment remains theirs but its increase in value is shared. It can also set how assets such as pension rights or a business will be calculated.
Who is it especially relevant for?
- Anyone entering a relationship with an apartment or significant savings.
- Anyone who owns a business or plans to start one.
- Anyone expecting an inheritance. See protecting an expected inheritance.
- Couples in a second marriage. See prenups for a second marriage.
Next steps
Every couple comes with different circumstances, so the agreement should be built around yours. At Paz Israel & Co. Law Office we review your assets, your plans for the future and the right approval route with you. To learn more about the process, see our prenuptial agreement lawyer page, or contact us to arrange a meeting in Tel Aviv, Jerusalem or Modi’in.
This article provides general information about Israeli law and is not legal advice or a substitute for reviewing your specific circumstances.