What is Title Insurance?

What is Title Insurance?

Title insurance is a means of protecting lenders and real property owners against title errors or defects in the property that could arise after the purchase of the property. Title insurance is different than other home, car or health insurance in that it does not protect from occurrences that could arise in the future, but instead from issues that occurred in the past.

What is a title defect?

A title defect is the legal right to claim ownership of the property. For example, you purchase a home from a real estate owner, and it is later found that buried in someone’s will, another person had the right to inherit this property. Without title insurance, the new homeowner could face a title dispute with the beneficiary of the property.

Do I need title insurance?

Most mortgage companies require title insurance that releases them of liability for title defects to offer a loan. This policy is designed to protect the lender’s interest in the property against loss from unknown title defects. In addition to lender’s title insurance, owner’s title insurance is also offered. While you are not legally required to purchase this insurance coverage, it is recommended as this coverage can protect you from the following:

• The time and cost of defending your property rights
• You will be reimbursed for your losses caused by defects in title
• Undiscovered title defects such as forged documents, liens on the property due to unpaid taxes, and missing heirs who may later come forward to claim the property.



If you are dealing with a title dispute, contact our skilled Waterbury real estate lawyer to discuss your case. (203) 583-8299