[ Title Insurance ] [ Owner's Policy ] [ Protections of Title Insurance ] [ Underwriters ]
What is Title Insurance?
Owning your property free and clear involves more than having a deed in hand. A deed does not cancel certain prior “rights” and “claims” other people may have to your property – rights whose existence you never suspected; claims that may go back in time months or decades to the earliest owners of your newly acquired property.
“What protection,” you may ask, “do I have against such claims? How can I be sure my property is really mine?” The answer to both of those questions is real estate ownership insurance, commonly known as title insurance.
Title insurance is an insured statement of the condition of your “title” or ownership rights to a certain piece of property. An owner's title insurance policy describes your property in detail and states what limitations, if any, there are to your ownership. (For example, you may take ownership subject to existing liens or encumbrances. Or you may not own mineral rights. Or easements may have been granted to utility companies or adjacent property owners.)
Most importantly, an owner's title insurance policy guarantees that the property you are purchasing is free of undisclosed liens, confusion in the rights of ownership, and other clouds on the title. In short, it guarantees that you own the property for which you bargained.
A low, one-time premium is all you pay to obtain the protection and peace of mind of a title insurance policy. So long as ownership remains in your name or that of your heirs, there is no additional cost. The policy is issued in an amount equal to the purchase price you pay. Of course, the greater the coverage given, the higher the premium.