How do I Know if I Have Title Insurance?
Sep 27th, 2017 | By FCT
It seems like an odd question – but some people who have title insurance don’t know that they have a homeowner’s title insurance policy, while many who have a lender policy believe that they are insured as homeowners. So much confusion!
How does this happen? Well, in the first instance, people who are title insured usually get their title insurance policy when they buy their home and likely learn about it at closing – which is a very hectic time. Normally, homeowners pay their title insurance premium as one of the many fees on their lawyer’s bill when they purchase their home. It’s not normally an item that you purchase on its own. The policy is often included in the lengthy package of legal documents that homeowners sign at their lawyer’s office to close their real estate transaction.
Also, since title insurance has a one-time premium and is in place for as long as you own your home, you’re not being asked to renew your insurance or have monthly premiums automatically deducted from your bank account to remind you.
On the other hand – the people who think they are insured likely choose to use title insurance in their mortgage purchase or refinance and believe that they have a homeowner’s title insurance policy. In this case it’s their lender who has the policy.
A lender’s title insurance policy protects the lender and the priority of their mortgage on your property. It has some benefits to the homeowner though, such as reduced transaction costs, smoother legal closing process and in the event of fraud, the lender has the title insurer to pay out their fraudulent mortgage – not the homeowner, who is likely a victim in the process.
So how can you find out if you have homeowner’s title insurance?
- Check the real estate closing documents from your lawyer or notary.
- Ask your real estate lawyer or notary.
- Call us. If you’re insured with FCT, we’ll have your policy on file and will be able to send you a copy. You can reach us at 1.877.888.1153. from Monday to Friday between the hours 8:00am to 8:00pm EST.
If your closing documents are buried in your closet somewhere, there is a rule of thumb that may apply. Because title insurance was introduced to Canada (by us!) about 25 years ago and it was not common practice to include it in real estate transactions until fairly recently, if you purchased a home more than 10 years ago, you likely don’t have a homeowner policy.
You know what that means? It’s time to call us and order one!