Title Insurance is a contract or agreement in which the Title Insurance Company (insurer) agrees to indemnify the owner (insured) of the Title Insurance Policy against any loss (up to the insured amount) that the party incurs as a result of the title being other than as shown in the policy.
Commercial Title Insurance
Unlike other Insurance Policies, such as a homeowner’s policy or automobile policy, title insurance is purchased with a single, non-repeating premium. This premium will be based in part on the amount of coverage, and in part on the customized extent of coverage provided through endorsements.
Title Insurance protects against errors that have already occurred as of the date of the policy, ordinarily the date of the closing or the date the documents are actually recorded, whichever is later.
Prior to issuing a policy of title insurance, the insurer will perform research and document review necessary to evaluate and limit the risk to both the insurer and to the insured. This will involve reviewing public records, the information about the transaction and other matters provided by the parties.