Legal entity that provides for ownership of property by one person for the benefit of another. The trustee receives title to the property, but does not have the right to benefit personally from that property. The trustee has a legal obligation to manage the property and invest its assets solely for the beneficiary of trust. Since the trustee is required to manage the property and its assets in a prudent manner, if the trustee fails to perform in accordance with the PRUDENT MAN RULE the trustee becomes personally responsible for any lost funds or profits incurred by the trust. There are basically two types of trusts: LIVING TRUST (established during the life of the GRANTOR) and TESTAMENTARY TRUST. For example, a trust may be established by a parent to hold assets for the benefit of a child.
Popular Insurance Terms
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Trust instrument that permits the owner of a residence (grantor) to transfer ownership of that residence with the grantor still being allowed to stay in that residence for a stipulated ...
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Person who uses personal property such as an automobile with permission of an owner. For example, for insurance purposes, someone who uses an automobile with the owner's permission would be ...
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