Buildings Insurance

JNYC

My parents signed their house over to me, they still live there no rent is paid. apparently I have to secure the building insurance & they organise contents is this correct? I just got a quote for £566 which is shocking for buildings only 

DullGreyGuy

Normally yes because they no longer have an insurable interest in the building. 

Its possible to draw up a contract that makes them liable for the building in exchange for living their rent free, you may want a token £1 fee in case a lawyer wants to argue if there is consideration or not without it, and then that creates an insurable interest for them. They'd need to declare they aren't the owners when getting quotes. 

Flugelhorn

I suppose regarding the signing over the property and them living there rent free, we should quote the wonderful Sgt Wilson "Do you think that is wise?"

user1977

JNYC said:

My parents signed their house over to me, they still live there no rent is paid.

Leaving aside the insurance query - why on earth have they done that? I can think of several downsides and very few upsides....

DullGreyGuy

user1977 said:

JNYC said:

My parents signed their house over to me, they still live there no rent is paid.

Leaving aside the insurance query - why on earth have they done that? I can think of several downsides and very few upsides....

Presumably to try and avoid IHT and maybe care costs

Hoenir

With no consideration paid there's also a potentially large CGT bill on the horizon. 

user1977

DullGreyGuy said:

user1977 said:

JNYC said:

My parents signed their house over to me, they still live there no rent is paid.

Leaving aside the insurance query - why on earth have they done that? I can think of several downsides and very few upsides....

Presumably to try and avoid IHT and maybe care costs

Well, yes, that's what I'm concerned about...

Flugelhorn

@JNYC - am sure you and parents thought they were doing the right thing but this could cost you far more than the £556 in the long run