# Homeowner's insurance policy in an "estate's" name. Why does my agent have a problem?
**URL:** https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093
**Category:** Factual Questions
**Created:** [February 14, 2005, 10:43pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093 "2005-02-14T22:43:29Z")
**Posts on this page:** 12
**Page:** 1
### Author:  [@stuyguy](https://boards.straightdope.com/u/stuyguy)
#### Post date: [February 14, 2005, 10:43pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/1 "2005-02-14T22:43:29Z")
My mom owned a house when she died, over a year ago. (Her and my dad’s names were both on the deed; dad died a year before mom.) Mom’s will divided up the assets – including the house – evenly among her three kids: myself and two siblings. I am the executor of the estate.
My siblings and I are now finally dealing with house. One of us may want to buy it from the other two, or maybe we will just put it on the market and split the proceeds three ways. That will be decided shortly.
My question involves the homeowner’s policy that mom had when she died. Naturally it was in her name. After she died, we asked the insurance agent to put it in the name of “Estate of Stuymom; Stuyguy, executor.” The agent did so, but reluctantly; the agent warned me that the insurance company would not want the policy to remain in the name of “an estate” for long. They want the name of a living deedholder on the policy, the agent said.
We might not have the house sold (to my sibling or whomever) by the time the policy is up in a couple of months, so I’m expecting more friction from the agent about the policy name when I ask for a renewal.
Why does the company/agent care whose name is on the policy as long as it is paid in full? Don’t pieces of property get tied-up in inheritence cases for years and years? If so, aren’t they insured by the estate until they are settled or sold? If the agent won’t budge, what do you insurance gurus suggest I do?
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### Author:  [@Inigo\_Montoya](https://boards.straightdope.com/u/Inigo_Montoya)
#### Post date: [February 15, 2005, 12:10am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/2 "2005-02-15T00:10:57Z")
This query has been forwarded to an underwriting supervisor dude I know–hell of a brilliant guy despite having one of the worst jobs on the planet. Stay tuned for The Straight Dope as it pertains to at least one U.S. insurance company.
My speculation? It’s difficult to underwrite a non-entity like an estate that has no financial history or potential for verifiable claim history. Pretend for a minute that someone asked you personally to insure their home for them. You’d want all the information you could (legally) obtain about that person wouldn’t you? So you could get an idea for what kind of claim activity you could expect. An estate has no such record. That said, homes are routinely insured when owned by a **trust**. I wonder how hard it would be for you to create The Stuy Family Trust, which would be composed of all possible heirs (thereby avoiding some probate problems).
Potential Solution:
Get a RENTAL DWELLING form policy, which insures ONLY the structure plus a few odds & ends, in the name of The Stuy Family Trust and grants some liability protection to The Stuy Family Trust.
Anyone residing in the home would obtain a RENTER’S form policy to cover their stuff.
Hopefully my source will come through with the actual answer to your WTF query early tomorrow. Or someone who actually does this for a living will chime in.
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### Author:  [@MrPeabody](https://boards.straightdope.com/u/MrPeabody)
#### Post date: [February 15, 2005, 12:48am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/3 "2005-02-15T00:48:02Z")
One of the key words in this discussion is “Homeowners”. Along with the issues raised by Mr. Montoya a homeowner’s policy is issued to an homeowner occupied dwelling. This might not seem to matter but for example in my state the policy cost is aprox four times as much for a vacant dwelling due to the increased risk.
Another issue is that most homeowners policy’s have a vacancy clause stating if the home is vacant for a period of time such as sixty days the policy becomes void even if paid in full.
Hope this helps.
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### Author:  [@stuyguy](https://boards.straightdope.com/u/stuyguy)
#### Post date: [February 15, 2005, 1:07am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/4 "2005-02-15T01:07:59Z")
Thanks for all the input so far. I welcome more.
Since Mr. Peabody mentioned it, it’s worth noting that the property, a 2-family house, is not vacant. One of my siblings (+ one) lives there on a full-time basis. The other apartment – the one that my mom lived in – however, is essentially unoccupied.
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### Author:  [@Rick](https://boards.straightdope.com/u/Rick)
#### Post date: [February 15, 2005, 2:12am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/5 "2005-02-15T02:12:26Z")
IIRC correctly from my agent training (a lonnnng time ago) Homeowner’s insurance is for owner occuiped dwellings. Homeowner’s policys are less expensive than OLT (Owner, Landlord, tennet) policys because the risk is less if the dwelling is owner occupied, and can be expected to have a lower claims experience.
IANAL and all that, but there could be coverage issues if a claim occurs and the dwelling is not occupied by the homeowner. if you are working with a lawyer on the estate, I suggest you consult them.
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### Author:  [@Inigo\_Montoya](https://boards.straightdope.com/u/Inigo_Montoya)
#### Post date: [February 15, 2005, 10:59pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/6 "2005-02-15T22:59:31Z")
Here’s my cite:
> [@](#):
>
> Our general concerns would be:
>
> 1. The executor may not have an insurable interest.
> 2. We might also have a concern with the occupancy/vacancy of the property (i.e. who is taking care of it, how often is someone checking on it).
> 3. Last thought coming to mind is taking on the liability of an estate. We are assuming there might be “extra” traffic, not contemplated in our rate.
#3 is a question mark for your situation. I wonder if you could arrange for The Estate to file a Quit Claim Deed ceding ownership of the house to all the heirs? Those typically don’t take a bunch of time and the ownership issue would cease to be an insurance problem.
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### Author:  [@batangsutil](https://boards.straightdope.com/u/batangsutil)
#### Post date: [August 26, 2016, 9:14pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/7 "2016-08-26T21:14:33Z")
I’m going through something similar and am curious as to what the resolution was of this matter.
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### Author:  [@watchwolf49](https://boards.straightdope.com/u/watchwolf49)
#### Post date: [August 26, 2016, 10:18pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/8 "2016-08-26T22:18:54Z")
As I remember, when my mom passed we cancelled her policy and my brother put the house under his policy. This might not work for the OP since my brother was the “successor trustee” to my mom’s revocable trust, and my brother already had a big policy covering a number of rental units. Couple of phone calls and we could start planning how to burn it down …
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### Author:  [@astro](https://boards.straightdope.com/u/astro)
#### Post date: [August 26, 2016, 10:32pm UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/9 "2016-08-26T22:32:24Z")
Per this there seems to be a strong desire by the insurer for the insured to have a strong direct physical interest in maintaining the house. I would think insuring estates probably (experience wise) has had some issues for insurance companies re maintenance and upkeep.
[http://www.insuranceqna.com/home-insurance/homeowners-insurance-policy-name-of-owners.html](http://www.insuranceqna.com/home-insurance/homeowners-insurance-policy-name-of-owners.html)
> [@](#):
>
> Yes, for the insurance company to issue the homeowners insurance policy, the home has to be named under the person living in the home, particularly, the one who is named as the owner of the house. The homeowners insurance policy specifically states that the named insured must also be living in the house and that the house must not remain unoccupied for a period of 30 consecutive days, otherwise, the policy can be considered invalid.
>
> Additional Insureds
>
> However, there is such a thing as an “additional insured”. This includes people (aside from the named insured) and even organizations that are covered by the policy’s property and liability coverage. This can include the spouse of the insured, as well as blood relatives that are currently living with the insured, as well as any other person who have the owner’s permission to live in the house (except for people who will fall under the category of “renter”).
>
> Rationale behind the Requirement Regarding Current Owners
>
> This is a legal requirement and an important one, from the point of view of the insurance company. The insurance company would like to ensure that the person named in the insurance policy has an insurance interest in the house, that is, the insured has an interest in keeping the house in good condition.
>
> This means that you can’t sell your house and expect your existing homeowners insurance policy to continue coverage of the house even as it has already transferred ownership. You are the owner of your own policy, while the new owner is the owner of his policy.
>
> Death of the Insured
>
> When the insured dies, it will be his estate that becomes the temporary insured. At the end of the policy period, the policy will no longer be renewed. So the insurance policy is not automatically transferred to the heir of the property. Generally, the heir will have to negotiate with the insurance company about the coverage.
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### Author:  [@UltraVires](https://boards.straightdope.com/u/UltraVires)
#### Post date: [August 28, 2016, 1:17am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/10 "2016-08-28T01:17:04Z")
> [@The Great Sun Jester](#):
>
> I wonder if you could arrange for The Estate to file a Quit Claim Deed ceding ownership of the house to all the heirs? Those typically don’t take a bunch of time and the ownership issue would cease to be an insurance problem.
My property professor in law school always bitched up a storm about anytime an estate would transfer property. Under property law, there is no such entity which may own real property. In the OP’s case, upon the mother’s death, the fee simple ownership in the real property is now vested in the OP, brother, and sister.
Any conveyance from Estate, by Executor to XXXX is an invalid conveyance because the estate does not have the power to convey the property. An even worse scenario would be if the OP and family decided to sell the home that way. Estate, by Executor to Cecil Adams would not give Cecil valid title as the owners (OP, brother, and sister) did not convey the property. Luckily nobody ever challenges this and the new owners get good title through adverse possession.
I suspect some variant of this is causing the insurance company the same concern. The estate itself has no insurable interest.
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### Author:  [@friedo](https://boards.straightdope.com/u/friedo)
#### Post date: [August 28, 2016, 4:36am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/11 "2016-08-28T04:36:01Z")
> [@UltraVires](#):
>
> An even worse scenario would be if the OP and family decided to sell the home that way. Estate, by Executor to Cecil Adams would not give Cecil valid title as the owners (OP, brother, and sister) did not convey the property. Luckily nobody ever challenges this and the new owners get good title through adverse possession.
If this were actually a major issue wouldn’t the buyer’s title insurance company have something to say about it?
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### Author:  [@Dereknocue67](https://boards.straightdope.com/u/Dereknocue67)
#### Post date: [August 28, 2016, 8:48am UTC](https://boards.straightdope.com/t/homeowners-insurance-policy-in-an-estates-name-why-does-my-agent-have-a-problem/290093/12 "2016-08-28T08:48:26Z")
When my mother died, her HO policy was changed to “The Estate of” because per the policy contract, the “Named Insured” no longer existed and in the event of a covered insurance loss, a questionable legal argument could be presented by the insurance company that no one had an insurable interest in the property as the “Named Insured” was dead. Most HO policies have eliminated language in the Policy Definitions of “Insured” to include “the named insured’s legal representative”.
I, as Executor, opened a bank account in the name of “The Estate of” as this provided a financial vehicle to transfer funds from the sale of the property to the heirs who definitely had an insurable interest in the property per the Will leaving the property to them. This insurable interest existed until the property is either sold or otherwise transferred because the heirs would suffer a financial loss should the property suffer damaged prior to the sale.
I believe to argue the “Estate”, in my case the heirs, have no insurable interest in the property is contrary to the definition of insurable interest. If the heirs benefit from the sale, would they not suffer financially from the property being damaged or destroyed by fire prior to the sale? In my opinion and in my situation, the Estate had an insurable interest in the property.
When the property was sold, all heirs signed the sale transfer documents in order to protect the buyer. I believe the best advice provided thus far is to transfer the HO policy to a Dwelling policy because it’s less expensive.