Title insurance is a form of indemnity insurance that protects lenders and homebuyers from financial loss sustained from defects in a title to a property.
Title Insurance
A clear title is necessary for any real estate transaction. Investors must do a search on every title in order to check for claims or liens of any kind against them before they can be issued.
Title Insurance Coverage
Unlike traditional insurance or transactional liability insurance, which protects against future events, title insurance protects against claims for past occurrences.
A basic title insurance policy typically covers the following hazards:
• Ownership by another party
• Incorrect signatures on documents, as well as forgery and fraud
• Flawed records
• Restrictive covenants (terms that reduce value or enjoyment), such as unrecorded easements
• Encumbrances or judgments against property, such as outstanding lawsuits and liens
A one-time fee paid for title insurance covers pricey administrative fees for deep searches of title data to protect against claims for past occurrences.
As part of RFB’s transactional liability risk consulting, we offer the best selection to our clients from a wide range of underwriting options such as:
(A) separate Title and W&I with different insurers, or
(B) the same insurer for both Title and W&I, or
(C) W&I to cover specific Fundamental Warranties risks in addition to General and Tax Warranties risks.