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Bill would extend short-term insurance coverage after transfer-on-death deed to avoid coverage gaps
Summary
A bill would require insurers to treat a beneficiary named on a recorded transfer-on-death deed as the named insured for a short transition period after the owner ies, preventing coverage lapses while beneficiaries arrange new insurance; sponsors proposed a 45-day limit or the policy's remaining term, whichever is shorter.
Representative Steve Fitzpatrick told the committee House Bill 464 is intended to close a coverage gap that can occur when a property owner records a transfer-on-death (TOD) deed: when the owner dies, title transfers to the named beneficiary, and some insurers treat the policy as ended because the named insured no longer has an insurable interest.
"The idea here is that the homeowner has paid a premium," Fitzpatrick said. "All that's happened is you've had a…
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