Title insurance 101

Posted by under Buying a Home

by News Canada

Everyone knows to protect the investment one makes in a home with home insurance.

But did you know that another important way to protect that investment is through title insurance?

Title insurance provides coverage for losses suffered from title, survey and other specified issues existing at the time of closing (and in some cases, arising afterwards), even if they are discovered years after becoming the owner. Title insurance is different from other types of insurance: payment for the insurance occurs only once and coverage lasts as long as the insured, their spouses, children or heirs own the home. There are generally no deductibles and no additional annual fees. A policy on a $300,000 home costs about $300 to $400 — a worthwhile investment when compared to the value of the home.

“Homebuyers put a great deal of time, energy and financial resources into finding their dream home, so it only makes sense to protect it with appropriate insurance,” says TitlePLUS spokesman Ray Leclair, a real estate lawyer and vice-president, Public Affairs (Acting) at LawPRO. “Title insurance is inexpensive to obtain, yet valuable to have.”

Risks covered by title insurance include unpredictable or undetectable issues such as forgery, fraud, missing heirs, unregistered rights-of-way and other issues that can affect rights of ownership.

Ask your real estate lawyer about your title insurance options. While title insurance is available at any point in time for those who already own their homes, it is usually secured when the home is purchased. Obtaining a title insurance policy when a home is purchased is beneficial to:

(1) get more coverage than a traditional lawyer’s opinion would provide, and
(2) in many cases, save the purchaser out-of-pocket costs on their overall legal bill as their lawyer may not have to do a number of searches normally required.

If a problem arises with title, survey or other matters that only becomes known after closing, title insurance can often assist the home buyer with the problem. Your real estate lawyer can explain its other benefits.


A useful resource for people looking to learn more about title insurance is the TitlePLUS Real Simple Real Estate Guide, available for free at www.titleplus.ca.

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