Title Insurance: As a homebuyer, the term is probably familiar - but is it understood? What is your dollar actually paying for when you purchase a title policy?
Title Insurers, unlike property or casualty insurance companies, operate under the theory of risk elimination. Title companies spend a high percentage of their operating income each year collecting, storing, maintaining and analyzing official records for information that affects title to real property. Their technical experts are trained to identify the rights others may have in your property, such as recorded liens, legal actions, disputed interests, rights of way or other encumbrances on your title. Before closing your transaction, the title company will proceed to clear those encumbrances which you do not wish to assume.
This theory is different from that of most other insurance where, for example, rates and anticipated losses are based on actuarial studies and premiums are pooled on the assumption that a certain number of claims will be made. The distinction is important: title insurance premiums are paid to identify and eliminate potential risks and claims before they happen. Medical and casualty insurance premiums, for example, are paid to insure against an unpredictable future event, knowing that risks exist and claims will occur. Furthermore, title insurance involves a one-time premium, paid when you close the real estate transaction, while property, casualty and medical insurance require regular renewal premiums.
The goal of title companies is to conduct such a thorough search and evaluation of public records that no claims will ever arise. Of course, this is impossible -- we live in an imperfect world, where human error and changing legal interpretations make 100% risk elimination impossible. When claims arise, professional claims personnel are assigned to handle them according to the terms of the title insurance policy.
As in all competitive business environments, rates vary from company to company, so you should make comparisons before deciding on a particular title company. Your real estate professional can help you do this. In addition, there are many helpful customer services provided by title companies which you and your real estate professional may find helpful to your transaction.
The issuance of a title insurance policy is highly labor-intensive. It is based upon the maintenance of a title plant, or library of title records, in many cases dating back over a hundred years. Each day, recorded documents affecting real property and property owners are posted to these title plants so that when a title search on a particular parcel is requested, the information is already organized for rapid and accurate retrieval. This investment in skilled personnel and advanced data processing represents a major part of the title insurance premium dollar.
Article by CLTABack to Table of Contents
Amelia Island Homes for Sale. Search Amelia Island MLS.
Amelia Island REALTORS® CENTURY 21 John T. Ferreira & Son, Inc.
500 Centre Street Amelia Island Fl 32034
Serving Amelia Island, Yulee FL, and Fernandina FL
©2018 Century 21 John T. Ferreira & Son, Inc. All rights reserved. CENTURY 21® and the CENTURY 21 Logo are registered service marks owned by Century 21 Real Estate LLC. Century 21 John T. Ferreira & Son, Inc. fully supports the principles of the Fair Housing Act and the Equal Housing Opportunity Act. Each office is independently owned and operated. Any services or products provided by independently owned and operated franchisees are not provided by, affiliated with or related to Century 21 Real Estate LLC nor any of its affiliated companies.
Amelia Island Board of REALTORS ® MLS© 2019. All rights reserved. Information deemed reliable, but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither the site, listing broker(s), nor Amelia Island Board of REALTORS ® shall be responsible for any typographical errors, misinformation, misprints, and shall be held totally harmless. Information provided is for consumer's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. This site will be monitored for "scraping" and any use of search facilities of data on the site other than by a consumer looking to purchase real estate, is prohibited. Listing broker has attempted to offer accurate data, but buyers are advised to confirm all items. Listing information last updated on 2019-09-15.