Why do I need insurance on property held in my loved one’s living trust?

Without proper insurance, trust assets in an Anaheim living trust are at risk of damage or loss. Successor trustees of living trusts have a duty to protect the trust’s assets. One way to protect these assets is to insure them adequately. Do you think you insurance is unnecessary? Think again. Any number of things could go wrong, resulting in damage to the assets. Following are six examples:

  1. A fire could occur on real estate owned by the trust, causing significant damage and making it difficult to fund repairs after the blaze.
  2. Valuable jewelry could be lost.
  3. Priceless artwork could be stolen.
  4. A tenant of a rental property owned by the trust could file a lawsuit accusing the property owner of negligence in providing habitable living conditions.
  5. A visitor on one of the properties could suffer a slip and fall accident and file a lawsuit against the property owner.
  6. A beneficiary or trustee could be driving a car owned by the trust and become involved in an auto accident.

If any of these unfortunate events occur, the net result is harm to the beneficiaries of the trust. Consequently, the trustee could be held liable for failing to protect trust assets. Obtaining insurance would provide protection against these unfortunate events.

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