Title Insurance and Your LLC
Friday, 08 May 2009 14:09
Title Insurance and your LLC.
"Whenever a transfer of real property for estate planning or asset protection planning takes place, the attorney is confronted with the issue of whether the property's title insurance policy will extend coverage to the new owner/grantee. Regardless of the form of new ownership (e.g., trust, corporation, family limited partnership, or limited liability company), if real property was transferred, in order to extend coverage to the new owner/grantee, an endorsement to the property's title insurance policy may need to be obtained adding the new owner/grantee as an additional insured."
There are two important recent cases that have sided with the Title Company.
"On February 10, 2009, in an alarming case entitled Patrick Man Kee Kwok, et al. v. Transnation Title Insurance Company, an order allowing a title insurance company to deny coverage was affirmed because the property owner, Mr. Kwok, did not obtain an endorsement to the insurance policy when he transferred real property from a limited liability company to his family trust."
To read the entire artcile: Title Insurance Issues in Real Property Transactions [2009-02-23] by Bradley G. Barth click here.
Suggestion: Contact your Title Insurance Company and ask to add the LLC as an Additional Insured. Also, if your property has gone up in value since you originally purchased the property ask to have the policy updated.
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