Posthumous Premium Payor

The 100-year-old named insured died of natural causes. His daughter, the executor, inherited and moved into the home, continuing to pay the same bills—including insurance premiums. Four years later, a fire occurred, but the policy still listed her late father. Can it pay out?
 
Notable Timestamps

[ 00:10 ] - The daughter continued to pay the premiums, but did not contact the insurance company to advise them of her father's death.

[ 01:30 ] - Trivia Time! Who was the oldest living person?

[ 04:06 ] – Insurance policies generally follow the insureds, as defined by the policy, as opposed to the property itself. 

[ 05:01 ] - A "death clause" provides a grace period to ensure coverage for the legal representative of the deceased (such as the executor of the estate) with respect to the premises and property covered at the time of death. This provision allows the family time to address affairs following a death.

[ 06:15 ] – The grace period is not indefinite. Coverage under this clause typically ceases once the probate proceeding is finalized and the assets are distributed, as there is no longer a legal representative for the deceased. Some modern policies also include a hard cap, such as 180 days (approximately six months), for this grace period.

[ 10:20 ] – Insurance companies are generally not obligated to actively seek out information regarding a policyholder's death. Courts have affirmed that the responsibility lies with the policyholder or the person seeking coverage to notify the insurer of any changes to the situation.

[ 13:56 ] – Arguments appealing to "fairness" or doctrines like "mutual mistake" (where both parties are mistaken about a fact) typically do not succeed in court when the insurance company was unaware of the policyholder's death. 

[ 17:33 ] – To prevent coverage lapses and ensure proper protection, it is critical for individuals or their families to contact their insurance agent or company to update policies, especially after a major life event like the death of a named insured.

[ 14:00 ] - Tim provides a recap of the points above.

Your PLRB Resources

Coverage Question: If Named Insured Dies, Does Non-Resident Legal Representative Have Duty To Maintain Heat?
https://www.plrb.org/documents/death-must-representative-maintain-heat/?search=duty%20to%20maintain%20heat%20representative

Ramsey v. Allstate Ins. Co. (6th Cir.) (2013)
https://www.plrb.org/documents/ramsey-v-allstate-insurance-co-6th-cir-2013/

Davis v. Westfield Ins. Co. (2022)
https://www.plrb.org/documents/davis-v-westfield-ins-co-2022/

Kantz v. Everett Cash Mut. Ins. Co. (2018)
https://www.plrb.org/documents/kantz-v-everett-cash-mut-ins-co-2018/

Employees of member companies also have access to a searchable legal database, hundreds of hours of video trainings, building code materials, weather data, and even the ability to have your coverage questions answered by our team of attorneys (https://www.plrb.org/ask-plrb/) at no additional charge to you or your company.

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The views and opinions expressed in this resource are those of the individual speaker and not necessarily those of the Property & Liability Resource Bureau (PLRB), its membership, or any organization with which the presenter is employed or affiliated. The information, ideas, and opinions are presented as information only and not as legal advice or offers of representation. Individual policy language and state laws vary, and listeners should rely on guidance from their companies and counsel as appropriate.

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