Sen. Bailey introduces bill to protect transfer on death deed recipients

AUGUSTA — On Tuesday, Sen. Donna Bailey, D-Saco, introduced LD 1752, “An Act To Provide Insurance Coverage for a Beneficiary on a Transfer on Death Deed.” The bill was the subject of a public hearing before the Legislature’s Health Coverage, Insurance and Financial Services Committee.

“In 2019, I was heavily involved with rewriting the Probate Code. During that process, we made transfer on death deeds an option for Mainers to settle property matters outside the Probate Court,” said Sen. Bailey. “However, these deed recipients don’t have the same legal footing as other legal representatives of a deceased person or estate. What this means is that transfer on death deed recipients are at risk of losing their inherited property to damage or disaster, such as a fire, at a particularly vulnerable time in their lives while they are still grieving the loss of a loved one.”

LD 1752 would allow a transfer on death deed recipient to maintain the homeowner’s insurance policy for a period of time. The idea for this bill came from a court case, Dawn Strope-Robinson v. State Farm Fire and Casualty, in which the deceased person’s transfer on death deed homeowner’s insurance policy terminated on their day of death. Before the deed recipient could take out their own homeowner’s insurance for the property they inherited, the house sustained fire damage. When the recipient tried to file a claim on the deceased’s now-expired policy, State Farm denied the claim. LD 1752 would protect Maine transfer on death deed properties by extending the homeowner’s insurance policy for 30 days and giving the deed recipient a status similar to that of a legal representative of a deceased person or estate.

The bill faces further action in committee.

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