General Information
What is Title Insurance?
A policy of Title Insurance
is a contract of indemnity between the insured and the insuring company
relating to the title to the land described in the policy, protecting the
insured against loss of damage by reason of defects, liens or encumbrances
of the insured title existing at the date of the Policy and not expressly
excepted from its coverage .
The Policy is issued after
a complete search and examination of the public records and shows the condition
of the record title, including any money obligations outstanding against
the property, easements and other matters which may affect the rights of
ownership, possession and use of the property.
Are There Different Kinds
of Policies?
Yes. Owners Policies are
issued to real estate owners. Purchasers Policies are issued to purchasers
of real estate under contract. Mortgage Policies are issued to mortgage
lenders. In addition there are several other special forms of policies.
There is a type of policy to meet the requirements of almost any form of
real estate transaction.
Title Insurance Protection
What Protection Does Title
Insurance Give?
It insures that the "record"
title, is good subject only to the exceptions expressly set out in the
Policy. lt also insures against certain matters which do not appear of
record, such as forgery, identity of parties, incompetence of former owners,
interest of missing heirs, and status of individuals not having the "right"
to sell property.
What Risks Are Not Covered?
The standard owners policy
and standard mortgage policy are based on public records of the recording
district in which the land is located. It does not insure against matters
which would only be disclosed by actual inspection or survey of the property.
It does not insure against certain matters not shown by the public records
such as unrecorded easements, liens or money obligations; unrecorded utility
rights of way, public or private roads, community driveways and other types
of encumbrances, or against the rights or claims of persons in possession
of the property which are not shown by the public records.
Can Protection Be Obtained
Against Matters Not of Record?
Upon application, the issuing
company may specially cover matters which are disclosed by a physical inspection
and/or a survey of the property, subject to any exceptions which the inspection
will determine to be proper. An additional risk premium is charged for
this type of coverage. Insurance of this kind is called 'extended
coverage'.
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