Posted by B.L.Renfrow on February 13, 2001 at 07:57:28:
Yes, I do use Bronchick’s letter, as follows:
Dear Ivan Insurer:
Please be advised I intend to transfer title to the above-referenced property into a revocable intervivos trust. The trustee’s name is xxx, whose address is (my mailing address).
Please amend the policy to a landlord-type policy to reflect the loss payee as follows:
“Jane Doe, as Trustee for the 123 Main Street Trust, and the beneficiaries as their interests may appear.”
Sincerely,
Heidi Homeowner
I don’t have the seller named anywhere, since the trust is now the legal owner of the property, and both the trust and trustee are named.
My own agent (State Farm) says this is acceptable. As I noted, I’ve not encountered a problem yet, with either an insurer or lender, though I have never filed a claim on one of these deals. I have had a couple insurance agents call me up in total confusion when they get the letter (actually, they call the seller, who then calls me). But once I’ve explained it to the agents, they either go ahead and do it as I ask, or else they’re so confused they just give up and stop asking questions!
Posted by LeonNC on February 12, 2001 at 10:44:39:
Ok, we’re about to close a subject to deal and I want to make sure I get the insurance right. We’re taking title in a land trust.
Here’s what I believe is the right way. Have the seller call the insurance company and tell them the property is being put into a trust. The seller remains the loss payee with the trustee/trust named as additional insured. The policy gets changed to a landlords policy. Does that sound right?
Re: Subject to AND insurance? - Posted by B.L.Renfrow
Posted by B.L.Renfrow on February 12, 2001 at 23:11:49:
No. I have the seller sign a letter to the insurer advising them the title has been transferred into a revocable, intervivos trust. I have them change the loss payee to “John Doe, as Trustee of the 123 Main Street Trust, and the beneficiaries as their interests may appear.” I do not want the seller remaining as loss payee.
At least that’s how I do it. Haven’t had a problem yet. Never had to file a claim either.
Why a landlord policy? Because a homeowner’s policy is written with the named insured being the owner-occupant. If a loss occurred, and the policy hadn’t been converted to a landlord policy, the insurer would likely deny the claim when they discovered the property was occupied by someone other than the homeowner.
Posted by LeonNC on February 13, 2001 at 24:46:04:
It sounds like you use Bronchicks letter which I have. At the bottom of the form do you list the additional insureds? Like keeping the seller on there as additonal insured to make things look normal.
And, do you have the wording in the same letter directing them to change the policy to a landlords policy? If you don’t mind could you share what language you use?