Title insurance provides protection to owners and lenders against financial loss caused by problems with a real property title which were not uncovered and corrected during the title search. Such problems can include defect in or lien or encumbrance on a title, no right of access, laws or zoning issues impacting the property, eminent domain, undisclosed heirs, and other issues impacting the property title. A defect in title could be due to events such as forgery, fraud, impersonation, improper transfer of conveyance, and inadequate documentation. A property lien which was placed against a previous owner might not have been found during the title search. An encumbrance or encroachment of the land may not have been disclosed before the transfer of the title.
There are two types of title policies, the loan policy and the owner's policy. The loan policy is required by the lender and is designed to protect the lender's interest in the property. The loan policy provides no protection to the owner and usually disappears when the loan is paid off. The owner's policy, on the other hand, is designed to protect the property owner's interest in the property and is valid as long as you own the property.
Title insurance companies usually require their agents to carry E&O insurance. We have access to multiple carriers that offer E&O insurance to title agents. Give us a call for details.