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<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060">I’ve heard from time to time that if an insured natural person transfers to an LLC, the LLC will be an insured under the policy. Can anyone explain why this is so?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060">I realize it depends on the policy. But under the ALTA Homeowners Policy (2021), I’m having a hard time finding anything that provides that sort of coverage, at least explicitly.
I’ve looked at “Continuation of Coverage,” which extends coverage to breach of warranty claims against the insured. But often the transfer into the LLC is by quit claim deed, which creates an obstacle to the warranty claim (though there are arguments to the
contrary that might work). In any case I’m looking for another basis for LLC coverage. The definition of the insured (“You”) doesn’t seem to help.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060">Any thoughts?
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060">Mike<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#002060"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D;mso-ligatures:none">The Law Office of G. Michael Zeno, Jr., P.S.</span></b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:black;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D;mso-ligatures:none">T: (425) 947-8050 F: (425) 947-8052</span><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:black;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D;mso-ligatures:none">135 Lake Street S., Suite 257</span><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:black;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D;mso-ligatures:none">Kirkland, WA 98033</span><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:black;mso-ligatures:none"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D;mso-ligatures:none"> </span><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:black;mso-ligatures:none"><o:p></o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:#C00000;mso-ligatures:none">IRS Circular 230 Disclaimer:</span></b><span style="font-size:11.0pt;font-family:"Calibri",sans-serif;color:gray;mso-ligatures:none"> Any
tax advice provided in this communication (including attachments) is not intended or written to be used, and it cannot be used, by the recipient or any other taxpayer (i) for the purpose of avoiding penalties that may be imposed on the recipient or any other
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