October 24, 2019 9:03 am
By Lorie Ham
So who owns your home? The obvious answer would be you, but in some cases that isn’t true. Sometimes people transfer their home to an entity they control like a trust or a limited liability company (LLC), or perhaps even a corporation.
Why would anyone do that? There can be many reasons. Sometimes it is to avoid probate, or for other estate planning purposes. It can also be to shelter your assets so a loss at one property doesn’t jeopardize other assets. If this is something you are considering, the best course of action is to talk to a lawyer about it and that person will help you make the best decision.
Let’s say that you find yourself in one of these positions, how does that affect the insurance on the home? As long as you have control over whatever “owns” your home and you live in it, the policy can still be a homeowner policy. However, you need to make sure to add the entity as an additional insured on the policy. Why? Because if something happens, the policy will cover only those listed on the policy. Things that could happen include a liability lawsuit, refinancing, and the death of a spouse. We all hope there won’t ever be a lawsuit, or a death, but life happens and it is wise to be prepared.
If you have any doubt about who owns your home, take out your deed and check. If it shows anything other than the names of the people living in the house, then it’s time to call your insurance agent to make sure that your coverage is correct. In case that unexpected thing happens, you want to be covered.
For even more details on this question, you can check out this article. Then make sure to check the deed, and if needed, call your insurance agent.
Categorized in: Home