Title Insurance

As a buyer of real estate, you want the assurance that the property you are buying will belong to you and be marketable--that there are no hidden interests in the property which will interfere with its use and ultimate disposition.

The written, public record of ownership of a particular piece of real property is critically important, but not sufficient in determining its ownership. In investigating the ownership of a parcel of property, one could trace the "paper chain of title" back to the original conveyance from the government. The chain of title, however, wouldn't readily reveal incomplete or erroneous shortcomings--forgery, or the mental incompetence of a grantor, for example. Title insurance was developed to help provide compensation for certain faulty guarantees and to assure marketable title.

How does title insurance differ from other types of insurance?
Title insurance is different from other types of insurance in that it protects you, the insured, from a loss that may occur from matters or faults from the past. Other types of insurance such as auto, life or health cover you against losses that may occur in the future. Title insurance does not protect against any future faults. Another difference is that you pay a one-time premium. A title insurance policy will protect you from risks or undiscovered interests. Once purchased, title insurance remains in effect for as long as you own your property.

Standard Policy
The standard policy of title insurance protects real property owners against items on- and off-record. Off-record risks include forgery, lack of capacity to enter into a transaction (incompetence or improper authority), impersonation, failure to properly deliver the deed, etc. The policyholder is NOT protected against title defects known to the policyholder on the date of issuance of the policy.

American Land Association Policy (ALTA for lenders).
This policy was developed to provide additional coverage to lenders who could not physically inspect the property without incurring great expense. It includes the risks associated with the rights of parties in physical possession, patent reservations, recorded notices of zoning enforcement, and unmarketable title.

Extended coverage (ALTA Owner's Policy)
This is a policy that gives buyers or owners the same protection that the ALTA policy gives to lenders.