Coverage & Claims
Unfortunately, if you are not listed on the policy and drive the car on a regular basis, it's not likely that you would be covered. Permissive use usually extends to those who drive someone else's car, but that is usually capped at no more than one use per month.
If you have a state ID, you can get insurance. However, most companies require you to get a license within a specific time frame, but not all.
Essentially, you need to have car insurance in the state where the vehicle will be kept. Car insurance is state specific.
We have more in-depth information about home insurance here. These numbers correspond to either home, renters, or condo insurance.
Stated value coverage is used for vehicles that are worth more than the Kelley Blue Book value. It is what your insurance companies rates the vehicle, but not necessarily what they will pay you if your vehicle was totaled.
Your homeowner's policy will not cover anything involved with the business unless you have a specific endorsement on the policy for an in-home business. You will want to check with your agent for your policy specifics.
I recommend getting a life insurance policy is this is something you are concerned about. To my knowledge, there is not coverage within auto insurance that would help with the death of a policyholder.
No, you will not be committing insurance fraud. You don't have to give a reason for canceling your policy at all.
If you keep the car registered in your name, there is a possibility that you could be held liable for damages that exceed the driver's policy. It is not common, however, there is still a chance.
Coverage & Claims
The estate should get a refund on the prorated premium that was paid for before the policy canceled. You will need to contact the insurance company right away to cancel the policy.