Homeowners Insurance and Your Trust – Shared Article

I heard that if your home was in your trust and one hadn’t updated their home owners insurance policy to reflect that change – there could be issue. So I combed the web for a good article to share with you. Please note, I have no affiliation with this company nor the author. I simply thought it was concise and I wanted to share. I read this article HERE, by Judd Matsunaga.

Do You Have a Home that has been Titled into your Trust?

If you’ve transferred your home’s title or deed into your trust’s name, it’s crucial to inform your insurance agent to maintain proper coverage. Some insurance companies require notification of such changes to recognize the trust as an insured entity under your policy. Without this, your trust might not be covered, leading to potential coverage issues. Typically, if the named insured is also the trustee, there shouldn’t be a problem, but it’s always better to be safe than sorry.

The Importance of Updating Your Policy

When your home is owned by a trust, your homeowners insurance policy should reflect this ownership to ensure comprehensive protection.This often involves adding the trust as an “additional insured” on your policy. By doing so, both you and the trust are covered for property damage and liability claims. Failing to update your policy can result in significant coverage gaps, leaving the trust exposed to potential risks.

Recent Los Angeles Wildfires Highlight the Need for Proper Coverage

Homeowners insurance and living trust issues re: the family home in light of the 2025 Los Angeles wildfire disaster.

The recent Palisades and Eaton wildfires in Los Angeles County have been devastating, resulting in the loss of life and the loss of numerous homes highlighting the importance of adequate insurance coverage. The Palisades Fire alone has burned over 23,000 acres and destroyed at least 10,000 structures in Pacific Palisades, Malibu, and areas of the Santa Monica Mountains.1

Similarly, the Eaton Fire in the Altadena area has caused extensive damage, destroying over 7,000 structures and leading to significant loss of life.²

These tragic events underscore the necessity of ensuring your homeowners insurance policy accurately reflects your home’s ownership status, especially when it’s held in a trust.

Risks of Not Informing Your Insurer

If you fail to notify your insurance company that your home is titled in a trust, several issues may arise:

Coverage Denial: In the event of a claim, your insurer might deny coverage if the policy doesn’t list the trust as an insured party.
Liability Exposure: Without proper policy updates, the trust may not be protected against liability claims arising from incidents on the property.
Personal Property Gaps: The trust’s personal property within the home might not be covered if the policy isn’t correctly adjusted.

Expert Recommendations

To ensure your home and trust are adequately protected, consider the following steps:

Review Your Policy: Examine your current homeowners insurance policy to understand existing coverage.
Consult Your Insurance Agent: Discuss the change in property ownership to a trust and determine the necessary policy adjustments.
Add the Trust as an Additional Insured: Ensure the trust is listed appropriately on your policy to cover its insurable interests.
Confirm Coverage Details: Verify that both the structure and personal property are covered under the updated policy.

By proactively updating your homeowners insurance policy to reflect your home’s ownership by a trust, you can safeguard against potential coverage issues and ensure comprehensive protection for your property and assets.

Need help ensuring your trust and homeowners insurance align? The expert Estate Planning attorneys at Elder Services of California are here to assist. Our team can review and amend your trust to ensure it’s up to date and fully protects your assets. Don’t wait until it’s too late—schedule a consultation today to gain peace of mind for you and your loved ones.

I read this article HERE. Please note, I searched for this article, I have NO affiliation with this insurance company, nor have I done any work with them. I simply thought the article was well written and covered the issue I was looking into.

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