Title insurance is a part of the general insurance category, being a one-time fee, and it is valid for as long as you or your heirs own the land or building insured; in the event of selling the building, the insurance policy loses its validity. Because title insurance can protect you and your heirs from title risks for the whole duration of the ownership right, it is very important for you to hold on to the document and keep it safe for as long as you own the property.
The importance of title insurance and why you should keep your policy safe
By insuring the title of property, the owner is protected from a variety of risks that could arise because of pre-existing problems. Such risks covered can include – but are not limited to – the following:
Fraudulent transfer of ownership rights
Improper or faulty execution of documents
Mistakes in the filing or recording of documents
Undisclosed easements or leans
Missing or undisclosed heirs
Unpaid assessments and taxes
Unpaid liens and judgments
The refusal of potential buyers to accept the title
Impersonation of the owner by fraudulent individuals
Pre-existing violations of zoning or subdivision laws
Any other defects in the title that existed before the start of your policy
As the vices of the title are identified, the insurer will need to take all the measures for their remediation.
As the owner, if you encounter an issue and have to contact the title insurer, you will find all the information you need on your policy, so it’s important to keep track of it. Because it is a one-time fee, many people tend to misplace their policy, as they don’t need to worry about keeping up with regular payments.
The title insurance policy is as important as all the other documents you received when you closed the property purchase and it will protect you from huge legal fees that may arise because of a title dispute, or even from the possibility of losing your property. If a legal claim is made on the title you own, the title company can choose to either pay the loss associated with that claim or defend the claim in court. In the latter case, the costs of handling the claim will be covered by your title insurance policy.