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Types of title insurance: How does standard title insurance work?

Types of title insurance: How does standard title insurance work?

Posted by Heartland on 19th Dec 2022

Did you know that the average person spends $149 a month on homeowner's insurance? That's about $1,784 a year. Many people understand the need for homeowner's insurance, but rarely consider the need for title insurance.

If you've never heard of title insurance, don't worry. We'll explain to you what's involved in standard title insurance as well as the different types of insurance policies you could choose from.

By the end of this article, you'll be able to understand title insurance policies and know which one you should choose when buying a home. You'll even have some additional tips to keep in mind regarding title insurance.


Although title insurance is for a home, it's important to remember that title insurance is not the same as homeowner's insurance.

Homeowner's insurance is meant to protect your home. It can protect it from natural disasters such as floods, or from things like a tree falling on the house. This protects your property itself.

Title insurance, by comparison, is very different. Title insurance is meant to protect homeowners in the event there's a problem with the title. There are many scenarios that can cause a title problem after you have already bought the house.

These problems could be anything from code violations to legal complications. In rare cases, you may buy a house only to discover that the seller either has no claim to it or someone else is disputing their claim. Any of these problems could make a title "bad" and spoil your legal ownership of the property.

With title insurance, you are protected from this kind of problem. Anything the title is lacking that could cause serious losses to the lender or the buyer is covered by title insurance.

If you want to prevent title problems, you should consider working with a title company when buying a new house. This won't protect you from all title problems, but it does make the chance of title problems happening less likely.

By working with a title company and making sure you have title insurance for your property, you are making sure you're doubly covered from trouble happening.


There are two different types of title insurance. The first type of insurance is simply standard title insurance, and the second is enhanced title insurance. The type you'll need depends on how much coverage you would like.

Standard Title Insurance

Standard title insurance is just basic title insurance. It will protect you from many things that could invalidate a title.

You are protected from improperly recorded or signed documents if you have standard title insurance. You're also protected from fraud, forgery, or duress in the chain of title.

Standard title insurance will protect you if there is a lien on your title form. A mechanic's lien is the only thing it doesn't protect you from.

Finally, standard title insurance can also protect you if someone is interested in your title.

Enhanced Title Insurance

Enhanced title insurance is more expensive than basic title insurance. However, it also covers you from more potential problems. So long as you decide you need the coverage, it is worth it.

Enhanced title insurance covers everything that standard title insurance does. In addition, it will cover you from a mechanic's lien.

Enhanced title insurance also protects you from the forced removal of a structure on your property. This could be for many reasons, such as building permit violations, lack of vehicular and pedestrian access, or maps being inconsistent with the legal description.

Enhanced title insurance also has many other benefits for you. It provides insurance coverage for a lifetime. Enhanced title insurance also has post-policy inflation coverage.

In addition, the enhanced title insurance covers boundary wall or fence encroachments.


A standard title insurance policy will protect you from title defects before you received title coverage. If anything happens to the title, all you need to do is file a claim.

If your claim is determined to be valid, you can be covered for financial losses up to the face amount of the loss.


Title insurance is incredibly important to have. However, having title insurance is not the only thing you need when buying or selling a house. You should have a full team of people to help you with the various parts of owning real estate.

In addition to a title insurance agent, you should have a realtor, an attorney, a mortgage broker or lender, and a home inspector. These are all important to successfully navigating the real estate sale.

What one person can do may not be in another person's skill set. A realtor can help buy or sell houses. A realtor cannot draft legal documents - you would need an attorney for that.

Assembling an entire team is the best thing you can do for yourself. With a team of experts, you should be able to navigate any problem.


Now that you know all about how standard title insurance works, we want to hear from you about your next steps!

Do you have questions about title insurance that you need to ask someone? Do you have any feedback on our policies that you'd like to provide? Would you like to get a title insurance rate quote from us?

If the answer to any of these is yes, then contact us today, and we'll get back to you as soon as possible.