State of the California and Florida Insurance Markets
A few months ago, we wrote an article titled Navigating California’s Insurance Market Crisis where we reviewed the current status of the insurance market, discussed the present risks facing insurance companies, and dove into the impact those risks may have on California residents.
Since this article was written, California was devastated by another set of fires in Los Angeles, including the Palisades Fire, Eaton Fire, Hughes Fire, Lidia Fire, and Sunset Fire. Notwithstanding the horrifying impact that these fires had on peoples’ lives and the Southern California communities, there is also a significant cost to rebuilding.
As insurance companies are processing claims, we are learning that some insurance companies are denying claims for homes that are titled in the name of the homeowner’s trust if the trust isn’t listed as the owner or an additional insured on the policy.
Given this news, we wanted to share some information and next steps for homeowners in these markets. If you are a homeowner, we recommend that (1) your home is titled in the name of your trust and (2) your trust is listed on your homeowner’s insurance policy. For more details on both of these actions, continue reading “The Next Steps” section below. Note that if you are renting or you don’t have a Revocable Living Trust, you shouldn’t need to take any action (feel free to connect with us if you’d like to confirm).
The Next Steps
Retitling Your Home in the Name of Your Trust
If your home isn’t currently titled in the name of your Revocable Living Trust, it may make sense to do so. If you are unsure of whether it makes sense for you specifically, please reach out to a member of your financial planning team for a recommendation.
The process for transferring the title of your home to the name of your trust starts with signing a trust transfer deed (prepared by your estate planning attorney) in the presence of a notary. This document is then recorded with the County Recorder’s Office. Included in the submission is a Preliminary Change of Ownership Report and any other county-specific forms that may be required.
If you submit the forms via mail, it may take up to 2 to 3 months to be processed. You can also visit the County Recorder’s Office and have the documents processed immediately. The documents can also be recorded online with the help of an attorney. Connect with your attorney to learn if they are able to e-record the documents.
Adding Your Trust as an Additional Insured on Your Homeowner’s Policy
If your trust isn’t named as an additional insured on your homeowner’s insurance, your first step is to reach out to your insurance agent. Let them know that your home is owned in the name of the trust and that you’d like to make sure your insurance policy has the trust named as an additional insured. The documents required can vary depending on the insurance company, but it’s likely you will need:
- A notarized copy of your trust document
- A copy of your deed that lists your trust
You may also be asked to complete a trust questionnaire. We are happy to share documents we have on file and help you complete any steps in this process.
Of course, if you need assistance, reach out to us and we will be in touch! And as always, please don’t hesitate to contact us with any questions.