It is quite understandable that after you become divorced, you no longer want your former spouse to be the beneficiary of your life insurance policy. Once the divorce is final, you should immediately choose a new beneficiary and change your policy.
The first choice for selecting a beneficiary would obviously be your children. If your children are very young at this time, consider starting a trust. With this trust, you can spell out the specifics of who is to receive what amount and at what age they will inherit the sum. The beneficiary would then become the trust and the trust would comply with your wishes.
If you do not have children, you can select other family members, a close friend or, if you like, a charitable cause. Some people with very small policies will name the funeral home of their choice as recipient so that all their funeral expenses are covered. This is not recommended, if it is a very large policy because you are over paying for services.
It is not recommended that you name your estate as the beneficiary. This will mean the policy will have to pay your estate, become part of the probate process and be subject to fees and taxes. You will delay processing of your estate and increase the amount your estate will need to pay an attorney to handle the process.
If none of these choices seem right, you may consider letting your policy lapse. However, you never know what the future will bring. Things may seem bleak now, but there is a possibility of remarriage in the future. In the future, it may also be harder to obtain a new policy because of age or health issues. Keeping your policy now may prove a very useful tool in the future.