Inheriting a home is not something you encounter often, and when you do, understandably, the last thing on your mind is likely the insurance. However, if the insurance company isn’t notified and the premiums aren’t paid, it can be difficult to get insurance later on if the policy ends up lapsing. Use this reference guide to help simplify what could otherwise be a stressful process.
To ensure the home stays fully protected, the first thing you need to do is contact the home insurance provider. In the event you inherit the home due to a death, the home insurance provider will need to be notified of the owners passing, and may need a copy of their death certificate for their records. If you had not previously been listed as a named insured on the policy, then the home may need to be held in trust of the estate while all the paperwork is sorted and processed. In this case, the legal representative of the estate would be responsible for the policy during this period of time.
You also want to confirm the method of payment for the policy. Often, the original owner’s bank accounts are closed and if the payments are being withdrawn by preauthorized debit you may end up having payment failures. Make alternate payment arrangements in advance to make sure that your home stays fully protected.
It is also important to continue to make sure the home is being well maintained. Hire someone to look after the exterior landscaping and either take some time yourself or have another family member check the home on a weekly basis, at minimum. It is best to leave the home looking lived in rather than vacant. Your insurer will want to know what your plan is for the home. Will you be moving into it? How long will it be vacant? Do you plan to sell the home? Once a home is vacant it can be more difficult to secure coverage. For this reason, it’s best to work with the existing insurer to see what options are available for you to maintain the current insurance.
Once you know when the title of the home is being transferred into your name, you will need to secure coverage as the new home owner. This will generally mean starting a new policy. You should be able to reference the old policy for some of the information you would be required to share with the insurance provider. It is also beneficial to consider getting a home inspection so you can be aware of any outstanding maintenance or areas of the home that will need to be addressed in the near future. This will also ensure that you are fully educated on the home, and will be able to answer any questions pertaining to the exterior condition, plumbing, wiring, or any other concerns an insurance provider may have.
It’s also possible that the home is not insured adequately if the existing insurance policy has been in force for some time. Updates to the home may have been done that haven’t been reflected on the insurance policy, so it is important to make sure that the insured value of the home is adequate for its current estimated rebuild value.
Change your locks
After this, when you have been given full title to the home, change the locks. Friends of the previous owner may have been entrusted with a spare set, or perhaps a contractor who did some work on the home. Often a cleaning service has a key, or maybe there was a caregiver who came into the home regularly. You never know who has had access to the home and may have a set of keys. The entire lock doesn’t need to be replaced as you can just change the pins inside to fit a new key. A local locksmith should be able to assist you. This will help to guarantee that there are no spare keys for your home floating around anywhere, and will provide you with additional peace of mind.
Some locks may allow you to rekey them yourself, without the help of a locksmith. If possible, you can check with the builder of the home to see if this is the type of lock they installed. Unless you’re a very handy person, you may want to leave this to the professionals. There will, of course, be a service charge involved, but consider this an investment in your safety.
If you are someone who is a proactive planner, something you can to do make things easier for your heirs, is to have them listed on title of the home prior to it being a necessity. Then, things like insurance are much easier to navigate at a future time. Make sure all the documents related to your insurance are stored in an accessible place or give them to your heirs in advance so they don’t have to search for them when needed.
Hopefully, these tips can make what will inevitably be an emotional and challenging time a little bit easier. If you have any other questions, you can always contact Square One at 1.855.331.6933 for more information.