Are additional insured persons under a policy entitled to coverage after the death of the named insured? What if it auto-renews? Additionally, in states that limit an insurer’s ability to retroactively cancel liability coverage, claims may be made against additional insured persons after the death of the designated insured. Under the terms of most policies, an insurer has no obligation to provide indemnification or defense under any of these circumstances, except to the extent provided by the policy. Hmm.
As with any contract, the deceased person lacks the ability to initiate or extend the term of the policy. As the Fourth Circuit pointed out in Wilkins v. Inland Mutual Ins. Ltd”[t]The requirement for notification of death of a nominal insured person is not an arbitrary one inserted to trap carelessness.[,]’, but replacing the designated insured with another party is ‘a significant change in risk’.