There are two primary types of title insurance policies:
- The Owner’s Policy
The Owner’s Policy is issued to the new Owner, guaranteeing that the Title to the property they are purchasing is delivered to them without any restrictions or encumbrances other than those listed in the policy. The Premium for an Owner’s Policy of Title Insurance is based upon the Fair Market Value of the property to be insured (for a purchase, this is usually the purchase price) and the type of coverage provided (e.g. regular coverage vs. enhanced coverage). In Vermont, the title insurance industry is regulated by the Vermont Department of Banking, Insurance, Securities, and Health Care (the “Department”). Rates are filed with and approved by the Department. Please feel free to contact either ALTI office for a premium quote.
- The Lender’s Policy
The Lender’s Policy is issued when there is a Mortgage Lien to be issued on the Property. It is a guarantee to the Lender that title to the subject property is free and clear of any encumbrances. Most lenders will not permit a loan closing to proceed without assurance from the title company that such a policy will be issued. The Premium for a Lender’s Policy is based upon the amount of the Loan and the type of coverage sought. As with the Premium for an Owner’s Policy, the Rates are filed with and approved by the Department.
Highlights of the Enhanced Title Insurance Policy:
- Pre- and Post- Policy Protections
In today’s real estate market, homeowners can take nothing for granted. Ticor Title Insurance and First American Title Insurance protect against many unknown elements by offering both pre- and post- policy coverage against most forgeries, liens for unpaid materials and labor not authorized by you, as well as building encroachment issues other than boundary walls or fences.
- Expanded Access Coverage
This type of policy expands the right of access coverage to include the existence of actual pedestrian and vehicular access over adequate streets or roads – your ability to get to or from your land on foot or by vehicle.
- Restrictive Covenants Violations
The Enhanced Policy protects homeowners against the loss of title to property because of a violation of a restrictive covenant that occurred before the insured acquired title.
- Building Permit Violations
With so many different city and town zoning and permit laws, it’s hard to keep track. But a homeowner shouldn’t have to pay for someone else’s oversight. The Enhanced Policy protects against certain losses incurred because no legal building permit was obtained for the existing residence. The coverage is subject to deductible amounts and maximums of liability.
- Subdivision Law Violations
The Enhanced Policy protects homeowners from loss if they can’t sell the property or get a building permit because of a violation of a subdivision law that existed on the date of purchase. This coverage is subject to a policy deductible and a maximum limit of liability.
- Zoning Law Violations
The Enhanced policy provides coverage if the land purchased is not properly zoned to permit one-to-four family residential homes or condominiums.
- Continuous Coverage
The Homeowner’s Policy covers homeowners forever, even if they no longer have the title. The policy insures anyone who inherits the title because of the homeowner’s death and the spouse who receives the title after a dissolution of marriage. The Homeowner’s Policy also allows homeowners to transfer title to their home into a trust after the policy date and receive uninterrupted coverage, at no extra cost.
- Supplemental Taxes
Homeowners should be wary of real estate tax surprises. In the event that a hidden real estate tax affects your title, this policy protects homeowners from the unforeseen costs.
- Value-Added Protection
Traditional title policies don’t increase their coverage as the value of a house increases. Not so with the Enhanced Policy. The policy amount automatically increases by 5 percent per year for five years up to 125 percent of the original policy limit. This automatic increase in coverage is included at no extra cost.