If your home is owned by your Trust, or if you are the Trustee or Personal Representative for someone who owned a home, you need to make absolutely certain that your homeowner's insurance knows that!
Earlier this year, the Michigan Court of Appeals was faced with a case where a homeowner transferred his house to his Trust as part of his estate plan. He never notified his insurance company of the transfer.
After the homeowner died, the Trustee renewed the insurance policy, but never told the insurance company that the house was owned by the Trust. While the family was at the home to divide the deceased's personal items, a family member fell through the stairs and was injured.
The insurance company denied the claim, and the Michigan Court of Appeals agreed with that decision. The Court found that although the Trust owned the home, the Trust was not the insured party on the policy, the homeowner was. Even with the Trustee paying the insurance premiums after the homeowner's death, that did not create a contract between the insurance company and the Trustee.
If you are new to estate planning and not sure where to start, contact us today for a free consultation.