Following the death of a loved one, you are obviously going to experience a period of grief and sadness. It is a time when families gather and support one another. Unfortunately, you will have to deal with taking care of details like utility bills and insurance. You’ll need to inform insurance companies and eventually cancel policies as you address matters related to the estate.
Generally, most if not all of these issues will be left to the estate’s executor to figure out. The executor is the person who has been left in charge of handling those matters directly related to the estate and the will. This is the person who will consequently deal with any insurance policies that may still be in effect or delegate to a helper.
What About the Deceased’s Car Insurance Policy?
As with any type of car insurance policy, as long as the premium continues to be paid the policy will remain active—with limitations. As the executor, you may still drive an automobile that is considered part of the estate but you are restricted in terms of when and where you may drive the car as far as the insurance coverage goes.
After informing your insurance broker of the death of your relative and/or loved one you as the legal representative of the estate will be covered by the existing policy as long as you are driving the vehicle for reasons directly pertaining to the estate. Therefore, driving for personal use is not permitted and thus not covered by the deceased policyholder’s car insurance.
As the executor you can make changes to the policy. It is very important to advise the broker immediately on the passing and inform them of who will be driving the vehicle and why. For instance it may just be parked in the garage because nobody will be driving it so in this case you can remove all driving coverages as long as it is in fact secured and most importantly again not being driven.
However, if someone will be driving it all of their relevant information must be provided to the broker so that they are listed on the policy. Of course, this driver must meet all of the insurance company rating requirements; if they have a poor driving record or numerous traffic violations they may not be able to obtain coverage. It’s just important that the broker knows what is happening with the vehicle.
What About the Deceased’s Home Insurance Policy?
Those issues concerning your relative’s home and subsequent homeowner’s insurance policy may be a bit trickier to deal with. First, will there be anyone continuing to live in the home? If the remaining resident was not listed as a policyholder then you will need to contact the insurance company and make the necessary changes in order for the home insurance coverage to stay in place and add whoever is going to be living there. Alternatively, you may cancel the policy and have them purchase their own policy. In notifying the insurance company of the death you may also be required to provide a death certificate or some other form of verification such as an obituary.
If the estate plans to sell the home it is important to maintain the home insurance policy until the house sells. Often what happens in this type of situation is that the house will sit for a while until matters are settled and the heirs figure out exactly what they want to do with the property. Problems can unfortunately arise when a house sits vacant for too long while its status is being determined. Insurance companies don’t like to cover vacant home as it is then more susceptible to theft damage or vandalism. If the house will be empty for any period of time–meaning no one is living there it is crucial to discuss options with your insurance broker as far as maintaining some form of insurance coverage on the property.
You can have someone check on the home every 48 hours and turn off the water. Or you can opt for vacant home insurance if no one will be living there while it sells.
If you plan to rent the home out, you’ll need to discuss with a broker to adjust your insurance.
Dealing with the aftermath of someone’s death can be most difficult. Not just in terms of the emotional aspects of the bereavement process but also when trying to sift through the more official issues related to the estate. When it comes to what to do with the existing insurance policies the first step is to speak with an insurance broker who understands these matters and who can help.
