Your house is in a trust. Is your insurance policy?

A married couple decided to set up a living trust a few years ago. Part of that process was to sign a deed that moved their house into the trust. Once the estate plan was done, they filed the paperwork away in a drawer. However, their homeowners policy was the same one they bought with the house. It still had their two names on it and no mention of a trust. Nobody did anything wrong here (most people don't think to call their insurance agent after signing a deed, and honestly, why would you?). Still, this gap got a lot of attention after the Palisades and Eaton fires in January 2025.

Photo by Jessica Christian on Unsplash 

Since then, some attorneys and policyholder advocates have warned that an insurer might deny a claim, or at least slow it down, when the deed and the policy don’t match. Let’s discuss what’s going on with this and what to do about it.

Why the name on the policy matters

When you deed your house to your trust, legal title moves to the trustee (usually it’s still you). Your homeowners policy insures a person, and it was written back when that person owned the house outright. California law says a policy has to rest on an insurable interest, and Insurance Code section 281 defines that broadly. It covers any interest in property where a covered event (like a fire) could directly cost the insured something. The standard fire policy language in section 2071 also says the insurer won't pay more than the insured's interest in the property.

So the argument an insurer could make goes like this: the person named on the policy no longer holds title (rather, the trustee does), and the policy never mentions the trustee. But you created the trust and you live in the house, which means you would clearly lose if it burned down. That seems like the insurance should have to cover it. However, many standard homeowners forms don't treat a trust as an insured at all, which is why the insurance industry has a separate trust endorsement for it.

There's another problem that has nothing to do with denial. If the only person named on the policy dies before a claim check is issued, the check may be made out to someone who can't actually cash it. The money can then end up in probate, even though the trust was created specifically to avoid this scenario.

If the only person named on a homeowners policy dies before a claim is paid, the insurance money may have to go through probate even though the house is in a trust.

Denied or delayed?

This is where the sources split. Berliner Cohen and Merlin Law Group, both law firms, wrote in early 2025 that insurers may deny or delay claims when a trust-owned home isn't reflected on the policy. Others say the claim won't be denied but might take longer while the insurer sorts out who owns what. United Policyholders, a nonprofit that helps people with insurance claims, has said a little of both. One page on its site warns that a mismatch could give an insurer grounds to deny. A staff answer from a few years ago tells a policyholder it shouldn't lead to a denial. Many policies allow a move into a revocable trust, and the owner still has an interest in the house.

Most of these warnings describe what an insurer could argue. Following the 2025 fires, we spoke to insurance attorneys and insurance companies and were comforted by both that no actual denials for this reason were anticipated. Since then, we haven't seen a published example of a California claim denied only because the house was in a trust. However, we also aren't aware of a court ruling that settles the question either way. And that doesn't mean it hasn't happened.

Even a delay (and not a denial) hurts most when you've just lost your home and are paying rent somewhere else. A dispute over who owns the house adds to the wait, even if the insurer ends up paying.

How to fix it

The good news is that the fix is usually just a phone call to your insurance agent. Tell them your house is now held in a trust and ask them to add the trust to the policy.  You can add it as an additional insured, using the trust's exact name as it is written out on your trust documentation. We suggest listing yourself both as an individual and as trustee, which is worth asking about. Ask whether the change covers every policy tied to the house, including earthquake coverage and any umbrella or rental policies. Finally, ask for it in all writing.

When your policy document arrives, read it over to confirm that you're still covered along with the trust and that nothing got lost in the update. If the answer you get doesn't make sense, ask for it in plain English.

Ask your insurer to add your trust as an additional insured, using the trust's exact name, and get the change confirmed in writing.

If you already have a fire claim open

If your home was damaged in the January 2025 fires and your claim is still open, there's no reason to panic or start over. Keep the claim moving, send in your records, and fix the policy now, because it can only help.

The more pressing question for many people is timing. Under Insurance Code section 2071, you have 24 months from the loss to sue on a fire policy when the loss is tied to a state of emergency. For the Palisades and Eaton fires, that works out to January 7, 2027. That date isn't always the end of the road, because California courts have paused the clock while an insurer is still working on a claim. The pause ends once the insurer clearly denies the claim in writing, as an appeals court held in 2026 in Kumar v. Mid-Century Insurance (a water damage case, not a fire). The details depend on where your claim stands, so this is a question for an insurance attorney, which is a different kind of lawyer than an estate planner.

For Palisades and Eaton fire losses, the policy's deadline to sue is 24 months after the loss, or January 7, 2027, though it can pause while the insurer is still working on the claim.

If you're not sure whether your deed and your policy match, pull out both and compare the names. When you're ready to look at the rest of your plan, reach out to our team at Laurel Trust Law.

This article is for general information and is not legal advice.