What is Title Insurance?

What You Need to Know

Title insurance is among the most important coverage you have to protect your real estate investment. Unlike other types of insurance, it focuses on risk prevention. It provides reassurance that your title company will stand behind you if a covered title issue or defect arises after you have bought your home. It is a one-time premium paid at closing.

What Title Insurance Covers

Even after the most meticulous search of public records, unexpected title issues may arise. These hidden defects are dangerous because you might not learn about them for months, or even years, after purchase. Some common examples of risks covered by your Owner’s Policy include defects in title caused by:

• Improper execution of documents

• Mistakes in recording or indexing legal documents

• Forgeries and fraud

• Undisclosed or missing heirs

• Unpaid taxes and assessments

• Unpaid judgments and liens

• Unreleased mortgages

• Mental incompetence of grantors on the deed

• Impersonation of the true owners of the land by fraudulent persons

• Refusal of a potential purchaser to accept title based on the condition of the title

Cost of Title Insurance

The one-time premium that you’ll pay is related to the value of your property. Use our Rate Calculator to estimate how much your title insurance policy may cost.

Owner’s Title Insurance vs. Lender’s Title Insurance

An Owner’s Title Policy is designed to protect you from covered title defects that existed prior to the issue date of your policy. If a valid claim is filed, your Owner’s Policy, subject to its terms and conditions, will cover financial loss up to the face amount of your policy.

A Lender’s Policy provides no coverage to the homeowner. A Lender’s Policy ensures that your lender has a valid, enforceable lien on your property. Most lenders require borrowers to purchase this type of insurance policy to protect their investment.