ResalesExceptions To Coverage In Your Title Insurance Policy
Your title insurance policy will list certain exceptions that will be
excluded from coverage. This is a standard practice, but you should be aware
of which items are exempted and therefore not covered. Owner"s policies
usually contain a list of some of the following standard exceptions. These
exceptions may include:
boundary line disputes
easements or claims of easements not show in the public records
taxes or special assessments left off the public record
claims of people who turn out to be living in the house ( such as a
prior owner"s tenants) if their being there isn"t a matter of
public record
unrecorded mechanic"s liens
mineral and/or water rights
You have the option of paying an additional fee to obtain "extended
coverage" for any items you want included in your policy. Your title officer
can tell you which endorsements are available. Other exceptions which are
generally excluded from coverage include zoning, environmental protection
laws, matters arising after the effective date of the policy, and matters
created, suffered, or assumed by the insured. Some other exceptions could be
subdivision and building codes, and matters known to the insured, but not
shown on the public records and not disclosed to the insurer.
Your lender will normally request certain endorsements added to their
lender"s title policy. These endorsements will often insure against defects
found only by inspection of the property, or by a survey, unrecorded liens
and easements, mining claims and water rights, and right of parties in
possession of the property. Title policies covering a condominium property
will also require special endorsements added to the policy.
Go over your title policy carefully to see what is included and which
items are to be excluded from coverage. If you find items of concern, discuss
these with your escrow agent or closing attorney. Any changes to the policy
of title insurance should be made before the close of escrow. It is possible
to remove exceptions by means of special endorsements, but the title company
must be aware of any special requests as soon as possible. Keep in mind that
title insurance gives you coverage only up to a certain point in time for all
events which took place during a previous point in time. A lien that is
recorded after title insurance is issued, will not be insured against a
claim. Some areas provide for your title company to issue inflation
coverage. This is an optional coverage item, is relatively inexpensive and
may be worth considering.
Your lender will normally request certain endorsements added to their
lender"s title policy. These endorsements will often insure against defects
found only by inspection of the property, or by a survey, unrecorded liens
and easements, mining claims and water rights, and right of parties in
possession of the property. Title policies covering a condominium property
will also require special endorsements added to the policy.
Also See:
What Title Insurance Will Do for You
Dealing With Clouds On Your Title
Closing Escrow When You Are Out of Town
Coverage And Types Of Title Insurance Policies