Insuring Trusts

Turn Knowledge into PowerFollowing on this week’s theme for the blog of who to name on the policy, I focus today on trusts. I do this before I tackle liability and financial lines policies where trusts are common place.  The important issue to remember is that a trust is not a separate legal entity, it is a relationship where the trustee is under a legal obligation to administer trust property for the benefit of the beneficiaries or for a specific purpose.

Any dealings and litigation are brought by and against trustees in their representative capacity on behalf of the trust. I have seen many cases where say a trustee company is named as the Insured but the Insurer has refused to accept that this brings in the trust as the trustee company also does other functions and the fact that it is a trustee has not been listed as an occupation.

For this reason, I would suggest that you name the trustee company as one insured and then the same entity a second time but adding the words “as trustee of the [insert trust name in full] trust.

Finally include trustee as one of the occupations.


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