About Title Insurance
What is Title Insurance?
Title insurance protects you from losses that occur from various matters affecting the title to land. There are two basic types of policy: Owner's policies to protect the owner, and Loan policies to protect the bank's mortgage.
If the bank requires a Loan policy, why do I need to buy an Owner's policy?
The bank's policy only protects its interest. You, the homeowner, may be liable for title problems even though the bank is insured.
I paid for a title search - why do I need to buy title insurance also?
A title policy insures against many defects which could not be discovered in a title search, as well as insuring against errors made in the title search itself.
Is Owner's coverage expensive?
No. A one time premium covers you throughout your ownership and after. When you are already paying for a loan policy, the additional cost for an Owner's policy is usually small.
What's Covered Under A Standard Owner's Policy?
The standard Owner's policy provides the basic coverage for a homeowner:
- It insures that you are the owner of the property.
- It insures against losses from any liens or encumbrances on the property except those listed in the policy.
- It insures against your title being rejected by a subsequent buyer because it is unmarketable due to a title defect or lien.
- It insures you have a legal right of access to the property.
The title policy not only protects you against losses due to title claims covered by the policy, it also pays for the attorney's fees and costs in defending the title.
You are covered under the policy for as long as you own the property, and also for liability after you sell the property if you provide title covenants in your deed to the new buyer.
Your title policy has built-in inflation coverage, that is, the amount of the policy automatically increases up to 150% of the original amount to no extra charge.
The Homeowner's Policy
In addition to the standard policy, there is also available a Homeowner's policy, which contains all the coverages of a standard policy, plus many additional coverages. The Homeowner's policy is available for just an additional 10% premium charge.
Providing the Best to Homeowners
Homeowners depend upon the strength and stability of a reputable title insurer to back their policies for years to come. Fidelity National Title has a long and proud history of providing homeowners with the most innovative title and escrow products in the industry.
With Fidelity National Title, homeowners can enjoy peace of mind knowing they are insured by one of the industry's premier title insurers. And with the Homeowner's Policy, they'll enjoy even more peace of mind knowing they have the best title policy available.
Superior All-Inclusive Benefits from the Homeowner's Policy
This superior policy gives your clients the most thorough and comprehensive coverage available in the industry. The new Homeowner's Policy includes the following basic coverage:
• False impersonation of the true owner of the property
• Forged deeds, releases or wills
• Undisclosed or missing heirs
• Instruments executed under invalid or expired power of attorney
• Mistakes in recording legal documents
• Misinterpretation of wills
• Deeds by minors
• Deeds by persons supposedly single, but in fact married
• Liens for unpaid estate, inheritance, income or gift taxes
The Homeowner's Policy also provides the Following Additional Benefits
• Pre and Post Policy Protections: The Homeowner's Policy coverage protects homeowners against claims arising both before and after the policy date. The homeowner is covered if someone else has an interest in or claims to have rights affecting the title, or the title is defective. Post-policy protection also includes coverage for forgery, impersonation, easements, use limitations and structural encroachments built by neighbors (except for boundary walls or fences) after the policy date.
• Expanded Access Coverage: The Homeowner's Policy provides homeowners with expanded access protection for right of access to and from the property. Traditional title policies do not define the type of access a homeowner has to the property, but the Homeowner's Policy specifically insures both actual pedestrian and vehicular access, based upon a legal right.
• Restrictive Covenant Violations: The Homeowner's Policy protects homeowners against the loss of title to property because of a violation of a restrictive covenant that occurred before the insured acquired title.
• Building Permit Violations: The Homeowner's Policy covers homeowners if they must remove or remedy an existing structure (except for boundary walls and fences) because it was built without a building permit from the proper government office. This coverage is subject to deductible amounts and maximum limits of liability.
• Subdivision Law Violations: The Homeowner's Policy protects homeowners if they can't sell the property or get a building permit because of a violation of an existing subdivision law. Homeowners are also protected if they are forced to correct or remove the violation. This coverage is subject to policy deductible and maximum limits of liability.
• Zoning Law Violations: The Homeowner's Policy protects homeowners if they must remove or remedy existing zoning laws or regulations (subject to the policy deductible and maximum limit of liability). Homeowners are also protected if they can't use the land for a single-family residence due to the way the land is zoned.
• Encroachment Protections: Covers homeowners if forced to remove an existing structure because it encroaches on a neighbor's land (coverage for encroachments of boundary walls or fences is subject to policy deductible and maximum limit of liability). Covers homeowners when someone else has a legal right to, and does, refuse to perform a contract to purchase the homeowner's land, lease it or make a mortgage loan on it because a neighbor's existing structures encroach onto the land.
• Water and Mineral Rights Damage: The Homeowner's Policy provides coverage if a homeowner's existing improvements, including lawns, shrubbery and trees, are damaged because someone exercised a right to use the surface of the land for the extraction of minerals or water.
• Supplemental Tax Lien: The Homeowner's Policy protects homeowners if a supplemental tax lien is filed and assessed against the property because of new construction or a change of ownership prior to the policy date.
• Map Inconsistencies: The Homeowner's Policy provides coverage if the map attached to the homeowner's policy does not show the correct location of the land, according to public records.
• Continuous Coverage: The Homeowner's Policy covers homeowners forever, even if they no longer have the title. The policy insures anyone who inherits the title because of the homeowner's death and the spouse who receives the title after a dissolution of marriage. The Homeowner's Policy also allows homeowners to transfer title to their home into a trust after the policy date and receive uninterrupted coverage, at no extra cost.
• Value-Added Protection: Traditional title policies don't increase their coverage as the value of a home increases. Not so with the Homeowner's Policy. The policy amount automatically increases by ten percent per year for five years, up to 150% over the original policy amount. This automatic increase in coverage is included at no extra cost.
Title Policy Coverage Comparison
This coverage has certain limitations and exclusions that apply. This policy has been adopted by both the CLTA
|Coverage Item||CLTA Standard Coverage||ALTA Residential (Plain Language)||New Homeowner's Policy|
|Post Policy Forgery Protection||No||No||Yes|
|Enhanced Access Coverage||No||No||Yes|
|Building Permit Violations||No||No||Yes|
|Subdivision Map Act Coverage||No||No||Yes|
|Restrictive Covenant Violations||No||No||Yes|
|Mineral Extraction Coverage||No||No||Yes|
|Map Inconsistencies Coverage||No||No||Yes|
|Coverage Extended to Living Trusts||No||No||Yes|
|Enhanced Encroachment Coverage||No||No||Yes|
|Automatic Inflation Protection (5 years)||No||No||Yes|
20 Important reasons why you should have owner's title insurance