12/02/2023
A Must Read
This is a very good explanation of a standard owners policy issued at closing versus an Enhanced policy. I would encourage everyone buying to always get an Enhanced one also known as an Eagle Policy.
Owner's Policy: Basic Coverage: A standard owner's policy is the basic form of title insurance designed to protect the property owner against financial losses resulting from title defects or issues related
to the property's ownership history. Coverage Amount: The coverage amount is usually equal to the property's purchase price or the
property's current market value at the time the policy is issued. Coverage Period: The policy covers title issues that existed before the policy's effective date but
not for any issues arising after the effective date. Standard Risks Covered: The standard owner's policy typically covers risks such as previous undiscovered liens or encumbrances on the property, fraud or forgery in the property's title
history, errors in public records, and other hidden defects in title. Limited Coverage: A standard owner's policy may not provide full protection against certain complex or specific title issues, such as boundary disputes, zoning violations, or unrecorded
easements, among others.
Enhanced Owner's Policy: Extended Coverage: An enhanced owner's policy, also known as an extended owner's policy or ALTA (American Land Title Association) owner's policy, provides broader and more
comprehensive coverage than a standard owner's policy. Additional Risks Covered: The enhanced policy includes all the standard coverages offered in
the basic owner's policy, as well as additional protection against a wider range of title issues. These additional risks may include coverage for boundary disputes, encroachments,
unrecorded easements, building permit violations, and certain types of land use restrictions. Expanded Coverage Amount: The enhanced owner's policy may offer coverage for an amount higher than the property's purchase price or market value. The coverage amount is typically
determined by the insurer and may be based on specific circumstances. Extended Coverage Period: Unlike the standard owner's policy, an enhanced policy may offer coverage for title issues that arise after the policy's effective date. This can provide ongoing
protection for the property owner during their ownership period. Higher Premiums: Since the enhanced owner's policy provides more comprehensive coverage,
it usually comes with higher premiums compared to the standard owner's policy. It's essential to carefully review the terms and conditions of both types of policies before making a decision. Title insurance is crucial in protecting property owners from potential financial losses resulting from undiscovered title defects. A qualified title insurance agent can assist in understanding the available options and recommend the most suitable coverage based on the
property's characteristics and the owner's needs.
