For most people, their home is the largest investment they make in their lifetime. Naturally, you’d want to protect it however you could. Everyone knows about homeowner’s insurance. What if something catastrophic happens and your house is seriously damaged or destroyed? Well, in most cases homeowner’s insurance will have you covered. But, in circumstances where legal mistakes and fraud are responsible for the damages rather than mother nature, you’ll need title insurance.
What Title Insurance Does
Your title indicates you’re the legal owner of your property. Title insurance protects against the appearance of title issues after you’ve bought your house. Most likely, you’ll have been compelled by law to purchase a title insurance policy when you bought your house. Since title insurance and its purpose are generally less familiar to people than homeowner’s insurance, it’s worth reviewing what title insurance can and can’t cover.
What Title Insurance Covers
If you find yourself in any of these situations, your title insurance should come to your aid.
- Lien Claims
- Ownership Claims from Inheritance Disputes
- Chain of Title Problems
Rarely, your title might have a lien that wasn’t disclosed by the seller and wasn’t discovered in your title search. Resolving these liens can be expensive, but that’s what title insurance is for.
Likewise, if there are other claims on your property, title insurance can cover your legal costs and associated losses. Finally, if there are undiscovered problems in your property’s chain of ownership, title insurance will assist you.
What Title Insurance Doesn’t Cover
You can think of title insurance as covering anything title related that your title company might have missed. That means if your title company did discover it and you were made aware of it before you bought the property, it’s unlikely it’ll be covered by your title insurance policy. These types of incidents include:
- Utility problems with the home
- Improperly documented deeds and wills
- An unreleased mortgage
- Back taxes
- Litigation related to the property
- Damages and defects on the property itself
Again, the rule of thumb is that if you knew about it going in, then you’re unlikely to be able to take advantage of title insurance to cover expenses.
When you get your title insurance policy, you’ll have the opportunity to negotiate for the coverage you need and clarify what kind of protection title insurance can offer you.
Let Clarion Title Handle Your Title Insurance Needs
When you purchase your home, you’re going to want effective coverage to protect not just your investment, but your family’s home. You can trust Clarion Title to provide that coverage, as well as all your title services. Let Clarion Title’s professional and experienced team go to work for you.
This material is provided as a courtesy and for educational purposes only. Please consult your title professional for specific information regarding your situation.