Can I buy homeowners insurance if I am the leasee on a lease to own property?
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UPDATED: Aug 22, 2012
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Insurance Question from Lithonia, GA
Asked on 08/22/2012
Can I buy homeowners insurance if I am the leasee on a lease to own property? Good day,I have a lease to own agreement with a very close (well trusted) family member, and I would like to get the homeowners insurance in my name, if possible. If my relative signs a quit claim deed surrendering their ownership to me would that enable me to be the policy holder? Also worth noting is that the property does have a bank mortgage on it .
Answer given on August 22, 2012
Homeowner insurance is intended to cover the property owner for damage to the home and contents. While you have a lease to own the property, the bank who holds the mortgage may not allow the title to be changed. If you purchase a homeowner policy in your name, and there is a loss to the home, the insurance company may decline to pay the claim since you are not the owner of the property.Some insurance companies will write a policy with special endorsements to protect you and the property owner. Call your agent or company and see if they will be willing to write a policy for you. If not, you may have to arrange a different plan for the insurance. Also, if the insurance company will not write the homeowner in your name, you should get renters insurance for the personal property in the home. If the policy stays in the family member’s name, then your personal property would not be covered by their policy.
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