What Is Title Insurance?

Buying real estate is a significant investment. Title insurance helps protect that investment against certain covered ownership claims, liens, encumbrances, and title defects that existed before you acquired the property.

Unlike most forms of insurance, which primarily protect against future events, title insurance principally protects against covered title problems arising from past events.

There are two primary types of title insurance:

• An owner’s title insurance policy protects the property owner’s financial interest against covered title defects and claims.
• A lender’s title insurance policy protects the mortgage lender’s financial interest in the property. A lender’s policy does not protect the property owner.

An important part of the title insurance process is identifying and addressing potential problems before the transaction closes.

The process begins with a search and examination of available public records affecting the property. The title search is intended to confirm ownership and identify matters that may affect the transfer of clear and marketable title.

Potential title issues may include:

• Deeds, wills, trusts, or other documents containing incorrect names or improper ownership information
• Outstanding mortgages
• Judgments and tax liens
• Construction or contractor liens
• Easements and restrictions
• Probate or estate-related matters
• Errors in recorded documents
• Defective or incomplete notarizations
• Breaks or inconsistencies in the chain of title

When a title issue is discovered, Citizens Title Agency works with the appropriate parties to determine what must be completed before the transaction can close and the title insurance policy can be issued.

Even a thorough title search may not reveal every potential title problem. Certain risks may be hidden, improperly recorded, or absent from the public records.

Examples of hidden title risks may include:

• A forged or fraudulently executed deed
• An unknown or undisclosed heir claiming an ownership interest
• A document signed by someone who lacked legal authority
• An invalid, expired, or fraudulent power of attorney
• Fraud, impersonation, or identity theft
• Errors in public records
• A deed executed by a person who was legally incompetent
• Previously undisclosed claims or interests affecting the property

If a covered title claim arises after closing, the title insurer may defend the insured’s title, attempt to resolve or cure the covered defect, negotiate with the claimant, or pay a covered loss in accordance with the policy.

An owner’s title insurance policy can provide protection against certain covered title defects, liens, ownership claims, and other risks that existed before the policy was issued.

Depending on the policy and the nature of the claim, coverage may include:

• Legal defense against a covered challenge to the insured’s title
• Efforts to resolve or cure a covered title defect
• Settlement of a covered claim
• Reimbursement for a covered financial loss, up to the applicable policy limit

An owner’s policy is generally purchased with a one-time premium paid at or before closing. Coverage ordinarily continues for as long as the insured owner retains an interest in the property and may extend to certain qualifying successors, subject to the terms and conditions of the policy.

A real estate purchase may be one of the largest investments you make. An owner’s title insurance policy provides valuable protection and peace of mind if a covered title problem arises after closing.

Citizens Title Agency conducts careful title searches, works to resolve identified title issues, and provides title insurance protection for eligible residential, commercial, and vacant-land transactions throughout Florida and New Jersey.

Contact Citizens Title Agency to learn more about title insurance or to request a title quote for your transaction.

Title insurance coverage is governed exclusively by the terms, covered risks, exclusions, exceptions, conditions, endorsements, and limits of the policy issued. Not every title issue or claim is covered. This webpage provides general information and does not modify, expand, or replace the terms of any title insurance policy.