Title insurance protects the policyholder from financial loss – including associated legal expenses – incurred as a direct result of fraud and unforeseen title challenges and defects.
Coverages & Inclusions
- Fraud
Title fraud is a crime that occurs when a fraudster successfully represents himself as the property owner in order to either (1) sell the property – often to an unsuspecting and innocent buyer – and disappear with the proceeds, or (2) mortgage/refinance the property, duping the lender and vanishing with the proceeds. For banks and lenders whose mortgages are unprotected by British Columbia’s indefeasible land title system, title insurance provides guaranteed coverage and protection against fraud. Arguably, title insurance is also the best way to provide homeowners with protection against title fraud.
2. Encroachments
If a pre-existing home, shed, fence, or driveway is discovered to be partially or fully located on a neighboring property, the property owner would incur loss to remove or relocate and rebuild on their own property. Title insurance would cover the owner’s financial loss.
3. Outstanding Costs from Prior Property Owner
Title insurance will cover costs discovered to be outstanding from the previous owner, including: outstanding work orders; outstanding property taxes, deferred taxes and, for Vancouver properties, Empty Home Taxes (EHT) that were missed in a conveyance; and, outstanding utility invoices from a previous property owner.
4. Work Performed without Permit
Title insurance will pay the cost of a financial loss incurred by an owner who is forced to remove or remediate home improvements due to construction performed without a permit by a previous owner (and where the previous owner had no prior knowledge of the previous owner’s lack of permit).
5. Strata Error or Non-Disclosure
The strata corporation’s omission, error, or non-disclosure of strata levies, pending lawsuits, etc. on the strata Form B Information Certificate, which causes the buyer financial loss will be covered by title insurance.
Obtaining a Title Insurance Policy
Coverage is available for a one-time insurance policy fee. The cost depends on the fair market value of the property, the mortgage amount, and the coverage being provided (homeowner policy, lender policy or both), but usually ranges from $200 to $750. There are no further costs (annual premiums or deductibles) beyond the initial policy price.
To obtain more information or order a policy, please contact our office for assistance.
