🏠 Does Putting Your House in a Trust Protect It From Lawsuits?

Disclaimer: This article is for general informational purposes only and does not constitute legal, tax, or financial advice. You should consult with an attorney or qualified estate-planning professional before making decisions about trusts, asset protection, or ownership changes.

It’s a question that comes up all the time in estate and liability conversations:

“If I put my house in a trust, can someone still take it if I get sued?”

The short answer: it depends on the kind of trust — and in most cases, it doesn’t.

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🔍 Revocable vs. Irrevocable Trusts

Revocable (Living) Trusts are the most common for estate planning.
They’re great for keeping your estate private and avoiding probate court — but they don’t protect your home from creditors or lawsuits.

That’s because you still control the trust. You can change it, revoke it, or sell the home anytime.
In the eyes of the law, it’s still your property, so a judgment creditor can still go after it.

Irrevocable Trusts, on the other hand, are designed so that you give up control.
Once the home is transferred, it legally belongs to the trust — not you.
If set up properly before any lawsuit or claim arises, it can provide real protection.

But there’s a catch:

• You can’t retain control (serve as trustee, change the terms, or live there rent-free).
• You can’t transfer the home after you’re already facing a claim — that can be ruled a fraudulent conveyance.
• You’ll need an attorney who understands asset-protection law to do it correctly.

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⚖️ What About Connecticut?

Connecticut does not recognize domestic asset protection trusts (DAPTs) like some states (e.g., Nevada or Delaware).
That means you can’t set up a Connecticut trust, keep control, and expect full protection.

However, Connecticut does have a Homestead Exemption.
As of 2023, it shields up to $250,000 of equity in your primary residence from most creditors — automatically.
That’s valuable protection, but it won’t help with large liabilities like auto accidents or business claims.

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📘 Sidebar: What Counts as “Control”?

Even in an irrevocable trust, courts look at whether you still act like the owner.
If you do, they’ll treat the house as yours.
Here’s what control looks like:

• You’re the trustee or can change the trustee.
• You can revoke or amend the trust.
• You live in the home without paying fair rent to the trust.
• You direct how the property is used or sold.
• You still pay expenses or receive income from the house.

Giving up control means letting go of those powers and benefits.
That’s what makes a trust a true legal shield rather than just a paperwork shuffle.

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🛡️ Protecting Your Home the Smart Way

If your main concern is liability protection, trusts aren’t your first line of defense.
Here’s what usually works best:

• Umbrella insurance: inexpensive and powerful coverage that adds protection on top of your home and auto policies.
• Proper titling and trust documentation: if your home is in a trust, make sure your insurance reflects it (see below).
• Early planning: real protection only works if it’s in place long before any lawsuit or claim.

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🏡 Don’t Forget the Insurance Side

If your home is owned by a trust — even a simple revocable one — it’s crucial to list the trust (and the trustees) correctly on your homeowners insurance policy.

That means:

• Adding the trust as an additional insured or additional interest, and
• Listing the trustees (especially if they’re not you) where appropriate.

Why it matters:
If the trust owns the house but isn’t listed on the policy, a claim could be denied or delayed because the “named insured” technically doesn’t match the deed holder.

Updating your policy ensures the trust and trustee have legal protection under your homeowners coverage — not just you personally.

Your insurance agent (that’s us!) can easily make that adjustment so everything lines up properly.

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💡 Bottom Line

Putting your home in a revocable trust helps your family avoid probate — but it doesn’t protect you from liability.
True asset protection requires giving up control and planning ahead, and it often works best when paired with strong insurance coverage.

For most homeowners, the best defense is simple:
good planning, good paperwork, and great insurance.

Page Insurance | Helping Connecticut homeowners protect what matters most.

This article is for informational purposes only and not legal advice. Please consult your attorney for guidance on trusts and estate planning.