"Does Insurance Coverage Continue When a Named Policyholder Dies?"

Derek Goff authored an article published by PropertyCasualty360 exploring insurers’ obligation to cover claims filed to a policy that has auto-renewed after the policyholder has passed away.

“Is an additional insured under a policy entitled to coverage following the death of the named insured? What if the additional insured continues to pay the policy’s premiums and the policy undergoes an automatic renewal following the death of the named insured? Further, what if a liability claim is made against an additional insured after the death of a named insured in a state that restricts the insurer’s ability to retroactively rescind liability coverage?,” Goff questioned to open the article.

“Under the terms of most policies, an insurer is under no obligation to provide coverage or defense under any of these circumstances except to the extent provided by the policy,” he answered. “As with other contracts, a deceased person lacks the capacity to enter or extend the term of a policy for insurance.”

Goff provided examples of auto-insurance claims and state statutes on rescinding insurance policies that support the notion that insurers are not liable for claims filed in these circumstances. However, he explained that one exception to the general rule may exist where other parties have a cognizable interest in the property that is set forth in the policy. “In these cases, a renewal of the policy following the death of the named insured may not void the policy,” he said.

For more details on cases involving these denied claims or exceptions, please see the full article here.