Estate planning attorneys regularly advise their clients about the tax and other advantages of transferring real property to revocable trusts or similar estate planning vehicles. But they may not consider the potentially disastrous title insurance implications of such transfers. The original property owners may have had coverage under their policy, but—depending on the type of policy—once the property is transferred to the estate planning entity, the entity (i.e. trustee of the trust) isn’t the “insured” anymore and coverage could be lost.
There is no ideal way to handle new estate planning engagements, and it’s important for an attorney to develop his or her own procedure. But there are common procedures taken by many experienced attorneys from which to learn. The first 5 steps in 10 Steps for Developing and Implementing an Estate Plan, Part I set the stage for an estate plan; these final steps take you through the process of putting the plan into place.