When someone passes away, insurance is probably one of the last things a family wants to think about.
There is grief, family to care for, arrangements to make and often a long list of unfamiliar responsibilities. If you are an executor or family member helping settle an estate, suddenly you may also be responsible for a home and everything that comes with it.
We’ve helped families navigate this transition, and sometimes simply knowing what questions to ask and what needs attention can be useful at a time when so much is changing.
One of those questions should be: What happens to the homeowners insurance when the homeowner dies?
Don’t Assume the Homeowners Policy Should Simply Continue
A homeowners policy doesn’t necessarily need to be cancelled immediately when someone dies. But it also shouldn’t simply be left unchanged without discussing the circumstances with the insurance company or agent.
Homeowners policies contain provisions addressing the death of an insured, but policy language, ownership and individual circumstances matter.
Some of the first questions to consider include:
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Who is responsible for the property?
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Is a surviving spouse or another family member still living there?
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Is the estate now responsible for the home?
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Will the property eventually be transferred to an heir?
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Is the plan to sell the home?
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Has the home become vacant or unoccupied?
The answers can affect what needs to happen with the insurance.
Has Anyone Told the Insurance Company?
With everything else happening after a death, notifying the insurance company can easily be overlooked.
Contact the insurance agent or company and explain what has happened. They may need information about the deceased homeowner, executor or estate and the plans for the property.
The objective isn’t simply to change a name on the policy. It’s to make sure the insurance arrangement reflects who owns or is responsible for the property and how the home is now being used.
Is Someone Still Living in the Home?
This is an important distinction.
A home occupied by a surviving spouse or other household member presents a different situation from a home that becomes empty while an estate is settled.
If no one is living there, tell the insurance professional. Insurance companies may have specific requirements or underwriting considerations for vacant or unoccupied homes.
Don’t assume the existing policy will continue to respond in exactly the same way after occupancy changes.
If You’re Responsible for the Home, Don’t Forget the Home
An executor may suddenly be responsible for a property while simultaneously handling dozens of other estate matters.
This is where some basic risk management can be particularly valuable.
Consider who will:
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Regularly check the property
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Maintain heat and utilities as appropriate
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Take care of snow, ice, lawn care and exterior maintenance
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Collect mail and manage deliveries
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Check for leaks or water problems
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Maintain smoke and carbon monoxide detectors
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Secure doors and windows
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Address maintenance problems that develop
A small problem in an unattended home can become a much larger one if nobody notices it.
What Is Going to Happen to the Property?
The longer-term plan matters too.
Perhaps the home will be listed for sale. Maybe an adult child will inherit it. It could remain in the estate for an extended period, undergo renovations before being sold, or eventually become a rental property.
Each change creates another reason to revisit the insurance.
Before changing how the property is occupied or used, talk with the insurance professional so you understand what may need to change.
Don’t Forget the Contents
The house isn’t the only consideration.
Family members may be sorting through furniture, jewelry, artwork, collectibles and other personal belongings. Some items may remain in the home for months while others are distributed among family members.
It’s worth discussing valuable property and the disposition of the home’s contents as part of the insurance conversation rather than assuming everything continues unchanged.
What About the Car?
If the person who died also owned a vehicle, don’t overlook the auto insurance.
Questions can arise about who can drive the vehicle, how it is titled, whether it is owned by the estate and what will eventually happen to it.
Before family members begin regularly using an estate vehicle or cancel the existing auto policy, talk with the insurance professional about the situation.
When Should the Homeowners Insurance Be Cancelled?
Usually, the better question isn’t “How quickly can we cancel the policy?”
It’s:
“At what point is the estate or family no longer responsible for insuring this property?”
A pending sale, transfer to an heir or other change in ownership doesn’t necessarily mean the insurance should immediately be cancelled.
Coordinate the timing with the insurance professional so there isn’t an unintended gap while the estate still has an interest in the property.
A Little Help During a Difficult Transition
Settling someone’s affairs after a death involves far more than insurance.
But insurance is one of those details that can become important very quickly if it isn’t addressed.
You don’t need to have all the answers before calling your insurance agent. Start with what you know: who passed away, who is responsible for the estate, whether someone is living in the home and what you expect will eventually happen to the property.
From there, you can begin identifying the questions that need answers.
At a time when so much is changing, having someone help you work through one small part of the transition can make the process a little easier.
Insurance Considerations
This resource highlights insurance and risk-management questions families and executors may want to consider following the death of a homeowner. It is not intended as legal advice or to determine how a particular insurance policy will respond. Coverage, policy provisions, underwriting requirements and individual circumstances vary. Executors and families should consult appropriate legal, financial and insurance professionals regarding their specific circumstances.
