What Is Owner Title Insurance?

When you buy a property, you expect that you own it free and clear. However, there may be hidden issues with the title that can cause complications and even legal disputes down the line. That’s where owner title insurance comes in. This type of insurance protects you against problems with the title of your property, so you can rest easy knowing that your investment is secure.

What Does Owner Title Insurance Cover?

Owner title insurance covers a wide range of issues that could arise with the title of your property. These include:

Not all policies are the same, so it’s important to speak with your insurance provider to understand exactly what your policy covers.

Do You Need Owner Title Insurance?

While owner title insurance is not required by law, it’s strongly recommended. Buying a property is a huge investment, and the last thing you want is to discover issues with the title that could jeopardize your ownership.

Even if you’ve done your due diligence and had a title search done, there could still be hidden issues that only come to light later on. Owner title insurance gives you peace of mind knowing that you’re protected against any surprises.

How Does Owner Title Insurance Work?

Owner title insurance is purchased at closing, just like other types of insurance. The cost of the insurance is typically a one-time fee that’s based on the purchase price of the property.

If an issue arises with the title of your property, you’ll file a claim with your insurance provider. Your provider will then investigate the claim and help you resolve any issues that may arise. If necessary, your provider will cover the cost of any legal fees and expenses associated with resolving the issue.

FAQ

What is the difference between owner title insurance and lender title insurance?

Owner title insurance protects you, the buyer, from issues with the title of your property. Lender title insurance, on the other hand, protects the lender from any issues with the title that could impact their ability to foreclose if necessary. While lender title insurance is often required by the lender, it does not protect you as the buyer.

How long does owner title insurance last?

Owner title insurance lasts for as long as you own the property. If you sell the property, the policy will expire.

What if I’m buying a property with a clean title?

Even if you’re buying a property with a clean title, owner title insurance is still recommended. There could be hidden issues with the title that are not discovered during the title search, and having insurance will give you peace of mind knowing that you’re protected against any surprises.

Can I choose my own owner title insurance provider?

While your lender may recommend a specific provider, you have the right to choose your own insurance provider. It’s important to do your research and choose a reputable provider with a strong track record.

Is owner title insurance transferable?

No, owner title insurance is not transferable. If you sell the property, the policy will expire and the new owner will need to purchase their own policy.

Conclusion

Owner title insurance is a valuable investment for any property buyer. It protects you against a wide range of issues with the title of your property, giving you peace of mind knowing that your investment is secure. While it’s not required by law, it’s highly recommended to ensure that you’re protected against any surprises down the line.