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What is Title Insurance??

First what is a Title?

Your property’s title is legal proof that you do in fact own your property and describes your right to the land.  This concept is sometimes confused with a property deed which is the legal document that transfers title from one person to another.


What does Title Insurance Protect Me From?

Typical insurances such as life or home insurance protect you from events that may happen in the future, for instance fire or accidental death.  Title Insurance on the other hand protects you from events which happened in the past, such as survey or public record errors, and unknown title defects.

Each Title Insurance Policy is different, but typically title insurance covers:

  • Title Fraud – usually involves someone using stolen personal information or forged documents to transfer the title of your home to themselves
    (or an accomplice), then taking out a mortgage on the property and disappearing with the money
  • Unknown Title Defects – title issues that prevent you from having clear ownership of the property
  • Encroachment Issues – an example of this would be if you discover that a structure on your property goes into your neighbour’s property
  • Construction done by a previous owner without permits – imagine if the previous owner removed a wall not realizing it was structurally supportive.  When you first moved in you loved the open concept but slowly you notice second floor is starting to sink. How much do you think it would cost to fix that mistake?
  • Legal Service Coverage protects against lawyers making mistakes during purchase
  • Survey or Public Record Errors
  • Existing Undisclosed Liens
  • Endorsement can be added for Well Water and/or Septic System defects


Title Insurance does not cover events such as:

  • Zoning bylaw or building code violations you create yourself
  • Environmental hazards
  • Native land claims
  • Known title defects
  • Issues which would have been discovered with a new survey or inspection of the property (property is smaller then you originally thought)

How much will this cost me?

The cost of Title Insurance varies based on the value of your property and which company you choose to go with.  Title Insurance is a one time premium that lasts as long as you own your home, and depending on your policy it maybe able to extend to heirs, a spouse in the event of divorce, or to children when the property is transferred from parents for nominal consideration. Though usually purchased when you buy your home, Title Insurance can be bought anytime after you have purchased your home. 


So where do I sign?

If you think Title Insurance maybe for you, contact your lawyer to discuss your options.

Before you sign on the dotted line here are a few tips to think about:

  • Make sure your property is insured for its full value
  • If you are purchasing your Title Insurance when you are buying your home, make sure the policy takes effect on your closing date
  • Make sure you understand what your policy covers and does not cover, and if you have any questions make sure you ask your lawyer or insurance provider.


Your Island Mortgage Team is here for you. If you have any questions concerning
mortgages, please contact us 1-866-898-8821.


Article written by: Jessica Cruickshank (Your Island Mortgage Team - Administrative Assistant)

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