Insurance For Subject To's
.I am in the process of getting new insurance policies for a few of my subject to houses. Should the name on the policy be my name (beneficial interest), the trust name or my trustee's name? Any help would be appreciated 
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I posted a similar question today, no responses yet, Beachboy, Contact me, I am starting to bird-dog in this area, do you buy east of Gulf Breeze?
[addsig]
If you don't have insurance on the property, the mortgage company will automatically assign you "high risk" insurance and add it to your monthly payments.
Hope This Helps!
Mrs. Meltzer
Can't Say haven't done any of these yet.
Where's our subject to MAN John ??????????where are you? I would be interested in what you can enlighten us on in this matter.
I believe if he's around he may can advise!
Why are you having to reinsure the properties. Couldn't you just get added as additionsl insured? When we use a Land Trust we use the Land trust as add insured leaving the original as insured also. No problem since we have the right to take care of any problem, if it arises, via release.
Best to you
Sire
From my understanding...correct me if I have this wrong....the current policy in place when the house is bought subject to is a homeowners policy. We are moving a tenant in the house and therefore need a landlord policy. I was told if a homeowners policy is in place and a claim occurs with a tenant in the house the insurance company would not pay. Is this correct?
So, if you keep the exisiting policy and the house burns down, wouldn't the check goto the original HO? Of course the loan is still in his name and he would have to pay it off, but he would also get the equity. Correct? What is the deed holder left with, a burnt done house and lot?
If the house burns down, and it was insured on a homeowner's policy while occupied by a tenant, there is a good possibility there will no pay out at all.
Insurance policies generally contain verbiage what is and is not covered, and homeowners policies are for the resident owners and do not extend to tenants.
(I'm an insurance broker in CO, and that's all I've ever seen)
i am not looking to rent, I'll refurb and sell. Need insurance for a few months.
If that's the case, then you'd need a Builder's Risk policy...they are typically designed for either a builder, or a renovator/remodeler. I'm assuming that the property will be vacant while it is being refurbished? The rates for builder's risk coverage are generally low, but it is sold asa 12 month policy, and has a 'fully earned" premium. What this means is that when you cancel the policy, there will be no pro-rated refund.
Hope that helps!
DK212,
Since you are the insurance expert, could you answer a question for me? When I get a new landlord insurance policy on a subject to house should the insured be “The 123 Main street land trust, Joe smith as trustee” or “Joe Smith, as trustee” or “Homebuyers, LLC” (the beneficial interest in the trust)? Any help would be appreciated!
Thanks,
Beachboy
If you have a financial interest in the property itself (an ownership interest, rents, equity, etc...) make sure you are at best, first named insured. This gives you (or your entity) primary rights to the policy benefits. At worst, ensure you have an additional insured AND loss payee endorsement (similar to how a mortgage company is protected).
The owner of the entity should be the 1st named insured. If this is a land trust, the trust language will (should) ensure that any policy benefits are disbursed correctly if a claim occurs.
I don't really think anyone's answering the poor Beachboy's question. The last poster may have been close but he said "the owner of the entity should be the 1st named insured". Does he mean the titleholder which is the trustee or does he mean the beneficial interest holder should be named as the "first named insured"?
And, like BeachBoy asked, if it is the trustee should it be
“The 123 Main street land trust, Joe smith as trustee” or “Joe Smith, as trustee”.
And, should both the trustee and the beneficial interest holder both be listed on the policy? Is it a problem for the insurance company or the lender if the original policyholder isn't on the policy?
So far I think I've discerned that the mortgage lender should be listed as a "loss payee" and I think it's been decided that the policy should be changed from a homeowner's to a landlord/tenant policy,...right??
When changing from a homeowner's policy to a landlord policy, some companies need to rewrite the policy. If it's rewritten, then list the loss payee as normal and make sure the lender is aware that the trust is the first named insured.
I have with care read all of your postings and I am afraid that I am a little confused.
Accordingly I have printed out all of the postings and tomorrow I am going to be instructed for two hours by one of the leading insurance brokers in all of Los Angeles.
I shall hand him this document and I am going to ask him to answer in decending order all of the points you have all brought up.
At the conclusion I shall then present him with a request to properly advise which is best and least expensive.
Frankly I am confused and have no definite bright and shinning answer.
Ergo to morrow I shall ask the expert.
In anticipation Lucius
Most insurance agents don't have a clue about land trusts etc and how to handle landlord policies. Why not find a GOOD insurance agent from your local investment group and get your own policy!
When purchasing insurance for your sub2 deals, the trust and trustee should be named as primary insured with the mortgage company and all beneficial interests as they may appear as additional insureds.
Some insorance companies will still want to see the names of your sellers on the policy. If this is the case, no problem, name them as additional insureds. If you have that power of attorney you should have gotten when you bought the house signing for them if there is a claim will be a non ssue.
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Quote:
On 2003-11-17 01:56, Lufos wrote:
I have with care read all of your postings and I am afraid that I am a little confused.
Accordingly I have printed out all of the postings and tomorrow I am going to be instructed for two hours by one of the leading insurance brokers in all of Los Angeles.
I shall hand him this document and I am going to ask him to answer in decending order all of the points you have all brought up.
At the conclusion I shall then present him with a request to properly advise which is best and least expensive.
Frankly I am confused and have no definite bright and shinning answer.
Ergo to morrow I shall ask the expert.
In anticipation Lucius <IMG SRC="images/forum/smilies/icon_cool.gif">
So Lucius what did the insurance guru say?
bump... Word back about insurance?
Please read this article and advise of questions you may still have:
http://www.thecreativeinvestor.com/modules.php?name=News&file=article&articleid=472
Beachboy, the deeded/titled owner should be the 1st named insured regardless of what or who that is. There are some exceptions to this, but not in the sub2 scenario. Many Agents will advise, incorrectly, that they have to name you personally as such. If this is the case, find another Agent, one that is familiar and active in REI.
Hope this helps.
Tim
[ Edited by norrist on Date 05/15/2004 ][ Edited by norrist on Date 05/15/2004 ]
Thank you.