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Friday, March 22, 2013

What is Title Insurance?

We all understand the concept of insurance.  Insurance provides some type of protection in the event something untoward happens in the future.

Title insurance is the opposite.  Title insurance protects against some event that happened in the past that casts some doubt on your ownership of real property (your home).

There are two types of title insurance – an owner’s policy and a lender’s policy.

The cost of title insurance in Florida is promulgated at a rate of $575 for the first one hundred thousand dollars in protection plus $5.00 per thousand thereafter.  For example, $200,000 in coverage will cost $1,075 ($575 + $5  times 100) for an owner's policy.

Usually, in Florida, the full charge is applied to the owner’s policy and a reduced rate is charged for the lender policy if it is a simultaneously issued policy.

While computerized record keeping means less error the potential always exists that something happened along the way to you obtaining your property that could cause a title question.

Title insurance is an inexpensive way to protect a large investment.   You only pay the fee once but the coverage you get is for your lifetime! 

Imagine if other insurances were so inexpensive!

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