Deceased Estate Insurance in NSW
Most executors assume the deceased's existing insurance covers everything. Usually, it doesn't. Policies lapse, change coverage terms, or explicitly exclude vacant properties. If the property isn't properly insured and something happens, the estate loses value and you're personally liable for negligence.
Important disclaimer: I'm not an insurance broker and this is general guidance. You need advice from a licensed insurance broker for your specific situation.
Why Deceased Estate Insurance is Different
The deceased's home insurance policy often:
- Terminates on death (policy conditions)
- Continues but has gaps in coverage
- Explicitly excludes vacant properties after 30 days
- Requires updated beneficiary documentation
- Doesn't cover liability adequately for a vacant property
You can't just "keep the same policy." You need to actively update coverage for a deceased estate.
What Insurance You Need
1. Home and Contents Insurance
- Covers the building structure
- Covers personal contents still in the house
- Must include vacant property cover (standard policies often exclude it after 30 days)
- You need to be named as the insured (executor/trustee), not the deceased
2. Landlord Insurance (if the property will be vacant for extended period)
- Covers property damage, liability, malicious damage
- Includes vacant property cover
- Covers loss of rent (if applicable)
- More comprehensive than standard home insurance for vacant properties
3. Public Liability Insurance
- Covers injuries to others on the property (inspectors, contractors, trespassers)
- You're liable if someone's injured due to hazards
- Essential if the property's in poor condition
4. Landlord or Trustee Liability Insurance
- Covers your liability as executor/trustee for property management
- Covers claims from beneficiaries
- Often part of a broader insurance package
The Vacant Property Problem
Standard home insurance policies often have clauses that exclude coverage if the property's vacant for more than 30 days. Vacant means:
- No one living there
- No regular inspections or maintenance
If your property is vacant (which most probate properties are) and you have standard home insurance, you're likely not covered. This is the most common insurance gap executors face. The companion piece on vacant property maintenance during probate covers what to do operationally to keep cover intact.
What to do:
- Call the insurer immediately after death
- Ask: "Does this policy cover the property while it's vacant?"
- If no: arrange vacant property or landlord insurance
- If yes: get written confirmation of the terms
- Update the policy to name you as the insured
Coverage Checklist
Ask the insurer:
- Is the property covered while vacant? (If no, you need vacant property cover)
- Are all contents covered? (Or just the building?)
- What's the liability limit? ($10M is standard for home insurance; estates may need more)
- Is there an excess? (What do you pay before insurance kicks in?)
- Are there exclusions? (Some policies exclude certain items or situations)
- How long is cover valid? (Annual policies need renewal)
- Can I be named as the insured as executor/trustee? (Not under the deceased's name)
Get documentation:
- Updated policy documents showing your name as insured
- Confirmation of vacant property cover (if applicable)
- Copy of the insurance schedule
- Premium and renewal dates
Cost and Timeline
Cost:
- Standard home insurance: $400-$800 per year
- Vacant property cover: usually $200-$400/year additional
- Landlord insurance (vacant): $600-$1,200 per year
- Public liability: $100-$300/year additional
Timeline:
- Update policy within 7 days of death (don't wait)
- Arrange vacant cover before 30 days (if property will be vacant)
- Renew annually during probate
- Cancel when property is sold or transferred to beneficiary
Common Problems
Problem 1: Assuming the existing policy is still active. Many policies terminate on the policy holder's death. Don't assume. Call the insurer and verify.
Problem 2: Not mentioning that the property's vacant. If you claim and the property was vacant without disclosure, the claim can be denied. Be honest with the insurer about the property's status.
Problem 3: Thinking contents insurance covers valuables. Standard contents policies often have caps on jewellery, art, collectibles. If there are valuable items, get them valued professionally and ensure adequate cover (or get specific "valuable items" coverage).
Problem 4: Ignoring liability coverage. If someone's injured on the property (inspector, contractor, trespasser), public liability insurance is critical. Don't rely on basic home insurance.
Problem 5: Letting the policy lapse during probate. Probate can take 6-12 months. If the policy lapses and something happens mid-probate, you're uninsured. Set a reminder for renewal.
Special Situations
Hoarding or Severe Neglect: Insurers may refuse coverage or charge premiums for hazardous properties. Get honest disclosure upfront and ask what's covered.
Multi-Property Estates: Each property needs separate assessment and coverage. Don't assume one policy covers all.
Properties Under Repair: If structural work is happening, insurance often requires specific worksite coverage. Inform the insurer about any active repairs.
Frequently Asked Questions
What if I can't afford comprehensive insurance?
At minimum, arrange public liability insurance. It's inexpensive and covers the biggest risk (someone injured on the property). Basic contents cover is also advisable. But don't skip both.
What if the property is severely damaged before I can get insurance?
Act quickly. Call insurers within hours of death, not days. Explain the urgency. Many have emergency cover processes. Document the property's condition with photos.
Does the deceased's insurance pay out to the executor or the beneficiaries?
Proceeds go to the estate. You hold them on behalf of beneficiaries. Use them to cover damage, repairs, or other estate costs. Then distribute what remains.
What if the property's damaged and the insurer denies the claim?
You have legal recourse. Get a solicitor to review the policy and the denial. Insurance disputes are common and often resolved through negotiation or formal complaint.
Is executor liability insurance necessary?
It's often part of a broader professional indemnity policy. For simple estates, you probably don't need it. For complex estates with high values, it can be wise. Discuss with your solicitor.
Bottom Line
Deceased estate insurance is different from standard home insurance. Verify that coverage exists, arrange vacant property cover, update the policy to name you as the insured, and ensure public liability is included.
Don't delay. Call the insurer within days of death. Get written confirmation of coverage. Keep renewals current during probate. This is one of the most important executor duties and one of the easiest to overlook.
Speak to a licensed insurance broker for specific advice on your estate. I'm not an insurance expert, but this general guidance should help you ask the right questions. The full Executor's Handbook covers the broader sequence of executor duties insurance fits into.
If the property management side needs support alongside insurance, I'm happy to talk it through. No obligation, no sales script. Phone 0428 613 163 or email info@aegispropertyconsultants.com.au.
