What’s not covered by title insurance?

Apr 27th, 2018 | By FCT

Jen and Henry* saved up for years and finally bought a house, even though it needed a little work. They considered themselves pretty handy and to save a few bucks, they decided to do the renovations themselves. While demolishing walls, they found that mould was growing in the guest bathroom. Jen was distraught at the thought of spending more money to clean up and fix the issue, but Henry was not. “It’s not a problem,” Henry said. “We’ve got title insurance!”

Unfortunately, Henry, like many others, didn’t understand what title insurance covers. While title insurance does cover renovations and repairs that are enforced by the local municipality due to work that previous homeowners did without permits, it does not include all repairs.

We often get claims that are more suited to home insurance. For example, Michelle and Jake*, title insured homeowners, noticed that the carpet in their basement was wet and they could see water coming in from the side of the house. They found a crack in the foundation wall where the water was coming in. Had the previous homeowners finished their basement without a permit which caused this issue, title insurance would likely have covered it if the municipality required the removal or repair because it was done without a permit. However, since this was not the case, we were not able to pay out the claim.

Other claims that are not covered by title insurance (but may be covered by home insurance, depending on your policy) are a leaking roof, fire or weather damage, infestations, etc. Title insurance protects your ownership of the home and covers unknown issues like fraud, forgery, encroachments (if your shed turns out to be on your neighbour’s property or vice versa), previous homeowner’s lack of building permits, and more.

If you’re ever in doubt, feel free to call us to confirm your coverage!

*Names were used for illustrative purposes and have been changed to protect the privacy of our clients.

This is for general information only. For specific coverage, please contact your title insurer or home insurance company.

Categories: Title Insurance

113 Responses to “What’s not covered by title insurance?”

  1. Thai Pham says:

    I bought a house in Normandy Park Washington State from Bank’s aution in Oct 2010. After closing date I receive a “Stop Work” from City’s Code Inspecter while i cleanning up this place.
    The city citation is this house need a final inspection certificate.
    I wonder why the Fidality Title Insurance is not discover this open permit in my closing?
    How I would hanlde this situation:
    Go ahead to comply with City ordonance or call Title Insurance company to make a claim for this case?

    • FCT says:

      Hi Thai,
      This blog only deals with title insurance in Canada, sorry. FCT’s residential owner’s policy has coverage for open building permits that existed on the policy date but we are unable to comment on what coverage may exist in Washington State. We suggest you contact your title insurer directly.

  2. Lisa says:

    We purchased our home from my father in law and he had 2 gardens and a small shed on the one side of our property that he used since 1978 when he built the home. Now we found out that land is not ours and the driveway which goes to our big shed is not our land either. We can not get to our shed and side tuck under garage because the road gets cut off. Also, the big shed is not 70 feet from the boundary line and there is a permit showing the county and an inspector approved it but now it is not in compliance. When we bought the property we assumed that part of the property was ours because my father in law used it from 1978 to 2017. But the county picture shows that part of our property is not ours and again we can’t get to our shed and garage and either can a fire truck or propane tank trucks or septic tank or well repair men. My father in law died 6 months after we purchased the home and he told us where the property line was and it was not correct. Is any of this covered under a title insurance plan?

    • FCT says:

      Hi Lisa, thank you for reaching out!
      FCT’s residential owner’s policy has coverage for situations involving structures that encroach onto adjoining land. The policy covers cases where the insured is forced to remove or remedy an existing structure because it encroaches onto adjoining land.
      It also sounds like you may have a zoning problem with respect to your big shed. FCT’s residential owner’s policy also has coverage for cases where the insured is forced to remove or remedy a structure because it violates an existing zoning by-law.
      The only way to get a coverage position for a claim is to formally submit one in writing, so that should be your next step. Follow this link to get started.

  3. Johnathan G says:

    Bought my house, and 6 months in my neighbour put up a new fence. I believe the fence to be partially on my property. Is an updated land survey covered in the policy?

    • FCT says:

      Hi Jonathan,
      That’s a good question. While a title insurance policy doesn’t have specific coverage for the costs of obtaining a survey, there is coverage in the policy for situations where someone else builds a structure on your land after the policy date.
      The coverage for this type of thing varies by region. In some provinces there is no coverage for fences but in other provinces encroaching fences built after the policy date are covered. The only way to get a coverage position for a claim is to formally submit one in writing. For information on how the submit a claim please follow this link, Jonathan, and thank you for reaching out.

  4. Joe Smith says:

    Hi,
    We purchased a home and it has solar panels. The installation had a permit. Three years later we purchased the house, we noticed a leak, the leak then noticed that the solar panels were not installed in compliance with the permit drawings (we got a structural engineer to confirm) and the damage is most likely from the installation. Now no one can provided us with the after installation inspection that was required to close the permit, and the permit was closed. Neither the city or the solar panel company are able to produce a copy of the final inspection. Would title insurance cover this?

    • FCT says:

      Hi Joe, thank you for reaching out.
      A residential owner’s title insurance policy has coverage for instances when the insured is forced by a governmental authority to remove or remedy something because it was built without a required building permit. The policy also covers open permits that existed on the policy date.
      It doesn’t sound like your situation because the panels were installed with a permit and the permit was closed. The only way to get a coverage position for a claim is to formally submit one in writing. For information on how the submit a claim check out this exaction of our website.

  5. Timothy Gilfillen says:

    I purchased a property recently, listing details were, 3 bedroom bungalow on slab with a drilled well. When we looked at the property prior to purchase the “well shed” was not unlocked and no key provided, so we verified through text to listing agent it was in fact a drilled well and response was yes it is. When we took possession we found out it is in fact a dug well and the “bungalow on slab” is in fact a trailer on a rotten wood foundation with concrete poured in one area to look like slab. Would any of this be covered under title insurance?

    • FCT says:

      Hi Timothy, thanks for commenting.
      There is no specific coverage in a title insurance policy for construction defects, but there is coverage for instances when the insured is forced by a governmental authority to remove or remedy something because it was built without a required building permit.
      There is also coverage for work orders and open permits that existed at the policy date.
      The only way to get a coverage position for a claim is to formally submit one in writing. For information on how to submit a claim check out this exaction of our website.

  6. Nicole says:

    I purchased a condominium townhouse in 2012. At that time there were cuts in the road but being as we were new home owners, we weren’t aware that we would be responsible for underground piping. It turns out, now, 8 years later, the condo board was aware at the time that the watermain had to be replaced but they chose to simply use the reserve funds to perform the repairs and not bother with adding funds to the condo fees to pay for the eventual replacement. Now we have a special assessment in the sum of approx. $35,000.00. Is this something title insurance would cover?

    • FCT says:

      Hi Nicole,
      That’s a stressful situation, thank you for reaching out to us.
      In legalese, FCT’s condominium endorsement does contain coverage for losses arising when there is a failure of the Condominium Corporation governing the condominium on the Land, to disclose, as required by law, in the Status Certificate obtained in this transaction, any situation that would give rise to its right to levy an increase in monthly common expenses or a special assessment against the unit.
      I would submit a formal claim by following this link to our claims page. That’s the only way to know for sure if you’re covered in this case.

  7. MM says:

    Hi there,

    I purchased a 16 year old home and 2 weeks in, I’ve discovered that there is a crack in my foundation from floor to ceiling, mold because of water that entered from this crack, my basement must be redone. The derived crack is because of a structural issue from the main supporting beam, also cracked and not up-to-code (it can’t support the house). I’ve had a structural inspection and mold inspection done of the home. Now 3 months in, I discover that the home has an open building permit which contains various inspection that were never okayed by the City and a list of requirements (which were also not done) from 16 years ago, which are in some cases redirectly related to this supporting beam.

    What is covered under my title insurance policy under open building permit? Does it also include the issues that results from a cause-in-effect? I am not really sure where to begin, it unexpected and financially it is a burden.

    • FCT says:

      Hi MM,
      Thank you for reaching out – I’m sorry to hear about your trouble.
      The good news is that FCT’ residential owner’s policy does have coverage for open building permits that existed on the policy date (your closing date).
      The only way to know for certain if there is coverage for your claim is to formally submit one, so that’s your next step. This link will take you to our claims page.

  8. Mike says:

    Hi. I recently bought a property. There was no Real Property Report available so the seller provided Title Insurance instead. Now that we are in it, I have noticed items that make me believe that there was no permit for addition which makes up 50% of the house. If there was no permit pulled for the addition, will my Title Insurance cover the cost to bring it up to code?

    • FCT says:

      Hi Mike,
      That’s a great question. Our residential owner’s policy covers situations where you are forced by a governmental authority to remove or remedy any part of your structure because it was built without a required building permit.
      I would head over to our claims section to verify the coverage, as that’s the only way to be sure. This link will take you to the claims page.

  9. Fred says:

    I just sold my home with an illegal front parking pad which was there when I bought it 5 years ago. If I receive a notice from the city to return it to green space before the closing date am I on the hook? Can the buyer back out if the deal?

    • FCT says:

      Hi Fred,
      It sounds like you should be seeking legal advice on this issue from your lawyer. I’m sorry that we can’t provide more specific legal advice here.

  10. Peter hamm says:

    My wife and I just purchased a home in our hot market without a home inspection (that’s the way it is now) but the previous owner looks like he put on an addition without getting permits. What will the title insurance protect us from? Will it cover the cost of permits? The cover of renos that need to be fixed?

    • FCT says:

      Hi Peter,
      Congratulations on the home purchase, and I’m sorry to hear about having to deal with the previous owner’s lack of permits.
      FCT’s residential owner’s policy covers situations where you are forced by a governmental authority to remove or remedy any part of your structure because it was built without a required building permit. The only way to know for certain if there is coverage for your claim is to formally submit one. Head on over to our claims section and we can get you started.

  11. Carole Delorme says:

    Hi
    We bouth an old cottage 75 years old. We are about to repair the flooring that is rotten, and repair the foundation. A lot of the construction beneath is not to code. If the city declares the cottage condemned, would title insurance cover this? Would it be possible that the City would not permit a fixing since it is in a flood plane and close to shore of the lake?

    I don’t know how to proceed. Can you recommend next step?

    • FCT says:

      Hi Carole, thanks for asking.

      There is no coverage for building code violations in a title insurance, nor is there any stand alone coverage for cases where a municipality condemns a building.

      There is coverage for work orders that existed on the policy date and cases where you are forced to remove or remedy something by a governmental authority because any part of it was built without a required building permit.
      The one way to know for sure if there is coverage for your claim is to formally submit one. Head on over to this section of our website to submit a claim and get the process started.

  12. Dan C. says:

    The article mentions “Title insurance protects your ownership of the home and covers unknown issues like encroachments (if your shed turns out to be on your neighbour’s property or vice versa).”

    We recently bought a home with a playground, and are now concerned it was built the home-association’s common ground.

    Would title insurance cover us for any forced removal or costs associated with this?

    Thanks!

  13. Dez says:

    Does title insurance cover us as home owners until we sell our house which is pending until March 18/2021? We had a leak in the foundation and had a friend fix it now it doesn’t leak anymore. We have had two spring melts since then so it’s fixed. So we would need the title insurance for about 4 1/2 weeks

    • FCT says:

      Hi Dez, in general terms, title insurance covers issues related to the title to the property. There’s no stand-alone coverage for flooding or foundation repairs. A residential owner’s policy covers the owner “forever” and there is no time limited policy. We suggest you speak to your lawyer or real estate agent on what to do in this situation.

  14. Rosanne Louise Williams says:

    Does title insurance cover an encroachment onto a neighbour’s property even if the encroachment was known about by the buyer? If there are problems later on will title insurance fix the encroachment so it does not encroach onto the neighbour’s property?

    • FCT says:

      Hi Rosanne, a residential owner’s policy contains coverage for some survey issues and claims against your title. To know for certain if you have a claim that is covered, you can submit a request on our website here.

  15. Andie says:

    hi we purchased a property, and have been having issues with the drainage. Only to find out we have a sag belly in the drain. I pulled the permits, we have a 3 br, 2 bath home, and the permit was pulled for a 2 br, 1 ba home. the system doesn’t seem to be strong enough to support the 2nd bathroom.

  16. Sherry L Thompson says:

    I bought a house in jan 2020, found out the kitchen, bathrooms and the carport was turned into a bedroom. All done with no permits. The city said the law is that there must be covered parking and due to where the setbacks are I have to tear down the 3rd bedroom and have it turned back into a carport or garage. Would this be something that is covered by title insurance?

    • FCT says:

      Hi Sherry,

      FCT’s residential owner’s policy contains coverage for situations where you are forced by a governmental authority to remove or remedy something because it was built without a required building permit. To get a coverage position for any claim you will need to submit it in writing. The claims process can be started by going to this section of our website.

  17. jen says:

    We bought a house in 2012 with an understanding of where our property lines were that was on Record. 2018 the town did a survey and took away some lake front? Does title insurance apply?

  18. Krista says:

    We bought a house a year ago and the well pump went and had to replace all the piping in it would title insurance cover this

    • FCT says:

      Hi Krista,
      This does not sound like something that would be covered under a title insurance policy but the only way to know for sure is to submit a formal claim. For information on how to submit a claim please check this section of our website. Apart from title insurance, FCT also has a product called Home Protection Warranty. If you have purchased this warranty from FCT you should consider submitting a claim under the warranty as it is more likely that this type of thing falls under a Home Protection Warranty but again, the only way to know for sure is to submit a claim.

      Regards,
      FCT

  19. Darlene says:

    Does title insurance cover you for the following; you find out after 6 weeks that 1/2 of your house actually sits on a municipality’s property and now they want your house moved? If the only solution is to move your house, does the title insurance cover this whole cost? My property sits on cinder blocks as it was existing prior to changes in building codes but now the code requires a foundation footing. If it now has to be moved, does it cover this cost as well? And what about the fact that this will take 8 weeks to get this done, during which I will not be able to use my property. Do they cover me renting another place for this period of time?

  20. Jennifer says:

    I bought my home in 2019. I received a bill from the city today saying that I owed for sidewalk repair that was done in 2017. They decided in 2020 to bill the homeowners for this repair. I’m struggling to understand how I could possibly be responsible for repair that happened before I owned the house. Is this something that follows the title, and if so, does title insurance cover?

    • FCT says:

      Hi Jennifer,

      Sounds like this may relate to a local improvement charge. Covered Risk 15 of FCT’s residential owner’s policy covers losses arising when “There is a lien or charge on your Title because of a local improvement charge, as to that portion of the total amount of the charge which had accrued prior to the Policy Date.” The only way to get a coverage position for a claim is to submit a formal claim for consideration. For information on how to submit a claim check out this section of our website.

      Regards,
      FCT

  21. Steve says:

    I am in the process of selling my condo. We have a firm deal but it has been discovered that the title for the parking space was not transferred. This goes back to two previous owners and finding the original owner to rectify the situation is proving quite difficult. When we bought the condo, we bought title insurance from FCT. Because of the lack of clear title, the buyer is threatening to not proceed with the deal. Obviously this needs to be corrected before another buyer can be found if this deal falls through and there will be legal fees. But, I’m concerned that I may not be able to sell the property for the original price on the deal that fell through in a subsequent transaction. I have also bought another property that I may not be able to close on due to the collapse of the sale on my current condo. Bridge financing is not available in this case as my current property remains unsold. What is FTC’s coverage in this case? Loss of deposit, legal fees, the differential in purchase price etc?

    • FCT says:

      Hi Steve,

      FCT’s condominium endorsement may provide some assistance in a case like this. A lot depends on the facts of your case and the wording of your policy. The only way to get a position on coverage for a claim is to formally submit one. You can submit a claim on-line. For further information, please go to this section of our website.

      Regards,
      FCT

  22. Rick says:

    I bought a house off the original owners, about 3 weeks after purchase I received a letter from the town stating I would be fined if I did not have a hard surfaced driveway built in 2 months. They said part of the building permit for the house was a driveway would be completed within 5 years of the homes completion. I explained that I had only just purchased the home and none of that was stated by the bank, real estate agents, inspectors or lawyers and that I did not have the funds to complete it. I also stated the house was 10 years old so they should have followed through with the original owners multiple times to ensure it was completed. Would title insurance pay for a driveway to be built in this scenario?

    • FCT says:

      Hi Rick,
      The only way to get a coverage position for a claim is to submit a formal claim for consideration. For information on how to submit a claim check out this section of our website. In general terms FCT’s residential owner’s policy covers losses arising from open building permits that existed on the day of closing but again, you will need to submit a claim to get a definitive coverage position for your situation.

      Regards,
      FCT

  23. Mel says:

    Hi, I have a question regarding my Title Insurance. Last year, in the fall and while I was at work, my neighbour took it upon himself to tear down half of my fence, which was apparently on his property. A brief history. I had bought the house four years earlier, and a year after having bought the house, the fence was falling over because his renters kept putting up large wooden items, and tools up against the fence. I spoke with my neighbour (absentee landlord) regarding his tenants issues, he informed me that the fence was old, and he and the previous owner had apparently had a ‘handshake’ deal to replace the fence at 50% cost to each. Of course, as a home owner with two homes at the time, I did not have the money to invest in a fence that I had never made a deal to replace, therefore, I refused. Fast forward to last year. I was having a deck built, and because my contractor did not get a work order from the town, my neighbour took it upon himself to then tear down two feet of my fence which was attached to his garaged, and then built a new fence through and on my property. To give you a visual, the fence was straight, attached to my house, and then formed a small 2 foot L turn, which attached to his garage. That provided me with somewhat of a backyard for the last four years. Now I have half of my backyard, they removed and discarded all of my perennials, and to add insult to injury, he had refused to speak to me regarding this act. After speaking with the town, it turns out the fence is 100% mine, which leads me to believe that not only did he trespass and destroy my property, the fence that he erected directly through my property will significantly affect the resale of my property. Do I have any case with Title Insurance? At this point, by-law officers, the police, and the town have refused to take any action, and have simply told me it’s a civil matter. Any help you could provide on this would be greatly appreciated. Thank you 🙂

    • FCT says:

      Hi Mel,

      The only way to get a coverage position for a claim is to submit a formal claim for consideration. For information on how to submit a claim check out this section of our website. There is no coverage for trespass in a title insurance policy. FCT’s residential owner’s policy covers situations where someone else builds a structure on your land after the policy date of the title insurance policy but in most provinces there is a carve-out for fences.

      Regards,
      FCT

  24. Mathieu says:

    We bought our home exactly a year ago(May 15th) and we finally opened the side of the deck to check what was underneath. We noticed that the structure didn’t look up to code and the frame wood was all rotten. They had replaced the actual deck boards on the top of the deck that made it look newly built so we were shocked to see they put it on top of rotting wood. The entire deck needs to be redone I’m surprised it’s still standing. Would this qualify for coverage? Thanks

    • FCT says:

      Hi Mathieu,
      The only way to get a coverage position for a claim is to submit a formal claim for consideration. For information on how to submit a claim check how to make a claim on our website. Generally speaking, a title insurance policy has no specific coverage for physical defects, building code violations or vendor misrepresentation. There is coverage however for work orders that existed at the policy date, the forced removal or remediation of the structure by a government authority because something was built without a required building permit and for open permits that existed on the policy date. If you do want to submit a claim head on over to our website to get the process started.

  25. Ian Barrett says:

    We purchased a residential property 2 years ago.
    The vacant lot in front of ours was purchased a few months ago.
    It looks like all my underground services run through this lot.
    Sewer / water / gas hydro

    And now the new owner wants to build but can’t .

    Seem like it was all one lot 30 years ago and a portion was severed and sold. But an easement process was started but never completed for the services . Both myself and the buyer of the lot have title insurance .
    Would we both be covered for this situation ?

    • FCT says:

      Hi Ian,
      The only way to get a coverage position for a claim is to submit a formal claim for consideration. For information on how to submit a claim check out this section of our website. A residential owner’s policy contains coverage for cases where the insured is forced to remove or remedy any part of the structure (in some cases boundary walls and fences are excluded) because it encroaches onto adjoining land. If you do want to submit a claim head on over to our website to get the process started.

      Regards,
      FCT

  26. Tasheika says:

    I just purchased my home back in August 2019 and 2 mo later in October I received a letter from the city saying that I was in violation of a code. I live on a corner lot and there is a concrete retaining wall attached to my driveway that’s in pretty bad condition and the city wants it fixed because it’s starting to lean. It’s clearly been like that far longer than the 2mo that I was there. Would this qualify for coverage?

    • FCT says:

      Hi Tasheika,
      The policy covers work orders but they had to have existed at the date of policy. There is other coverage that may be applicable to your claim but you will have to submit a formal claim in order to find out if you have coverage or not. The best thing you could do is to submit a claim and a claims specialist will review your situation and provide guidance that is specific to you. You can get the claim process started by going to this section of our website.

      Regards,
      FCT

  27. D.Brown says:

    I bought a newly constructed home. My lawyer included a title insurance policy prior to taking possession. The HVAC system was on backorder. I was assued by the builder it would be installed when available.. It never was. I contacted the new home warranty program, they told me to contact my title insurance provider, they would help. They didnt. I have since learned that my new home does not have a Final Occupancy Permit. It was negated by lack of HVAC installation and a couple of other OBC violations. Technically, I do not have the legal right to live in my home. Would a FCT Platinum Policy have covered these issues?

    • FCT says:

      Hello,
      The only way to get a definitive coverage position for a claim is to actually submit one. If your policy is with FCT you can get the claim process started by going on-line and checking out this section of our website. It sounds like you may have submitted a claim already and if your policy is with FCT you should go back to the claims handler with what appears to be new information about the lack of a final occupancy permit. FCT’s Platinum Policy covers losses arising from “ Any adverse circumstance affecting the Land which would have been disclosed by a Local Authority Search of the Land at the Policy Date.” The term “Local Authority Search” is defined in FCT’ s Platinum policy as “any search of local government records pertaining to the Land which would customarily be required by a solicitor or notary qualified to practice law in the province or territory where the Land is located in the normal course of a real estate transaction”. In general terms, this coverage extends to things such as open building permits.

  28. josh and missy says:

    to add info to my post ….. one permit found for work on house was, weeping tiles in 2017… some cinder block cracks had silicone in them and others didn’t …
    this wall in question was covered up in and out …. our home inspection couldn’t reviel any problems 🙁

  29. josh and missy says:

    Need clarification on title insurance coverage ,
    My wife and I purchased a home , we did all we could to feel comfortable about this big purchase. we had a home inspection done and he only found minor issues that any other home would have …. nothing we couldn’t remedy ourselves.
    after a year in our home (all four seasons) we discovered, the parging had cracked and revieled major foundation issues….
    inside foundation wall was covered with a 2×3 insulated wall with paneling over it …
    after removing this wall …we discovered huge cracks in block wall.
    the cinder blocks are newer then all other walls so lead me to think a permit must of been in play…. I requested from the city all past permits and there wasn’t any for this work.
    the home had been in the sellers family since 1972.
    I’ve called in the city inspector to get advice on procedure.
    seller mentioned two additions that were added to the home but no permits to account for all this work…
    very frustrated , feel like i’m chassing my own tale .
    is this claim worthy ?

    • FCT says:

      Hi,
      FCT’s residential owner’s policy covers situations when you are forced by a governmental authority to remove or remedy your existing structure because any part of it was built without a required building permit. The only way to get a coverage position for a claim is to make a formal claim under your policy. You can get the claim process started by going on-line and checking out this section of our website.

  30. davida says:

    I bought our home 10 years back, knowing that the house encroached several inches onto our neighbours property……paying cash meant that title insurance was not an issue. When I resell, and assuming the purchaser will need a mtg, and thus likely title insurance, will the encroachment pose a problem ?
    As a secondary consideration, currently we have a copacetic neighbour. Should our present neighbour sell, could a new neighbour, one who is not happy with the encroachment, cause problems ?

    • FCT says:

      Hello,
      FCT will often offer some form of coverage over what we call “known defects”. The extent of the coverage that FCT is prepared to offer over known defects will be dependent upon the nature of the problem, how long it has existed and many other factors. If and when you decide to sell your property you should raise this issue with your real estate agent and lawyer before signing any contract and also let them know that any purchaser should be made aware that FCT might be able to offer some form of limited coverage over this known defect. The purchaser’s lawyer would then contact our underwriting department to start the process. With respect to your secondary consideration, there is a legal concept called adverse possession that might be of some assistance to you. You should discuss this with your lawyer.

  31. DE says:

    Hi ,
    My wife and I bought a house and were provided a survey , from the original developer of the property. 3 years passed and another survey, by the same surveyor, was done and it totally changed my property. Would this be covered by title insurance?

    • FCT says:

      Hello,
      There are two areas of coverage in the residential owner’s policy dealing with surveys. The first deals with the forced removal of encroachments and the second deals with marketability issues arising from adverse matters disclosed by an up-to-date survey. The only way to get a specific coverage position on a matter would be to submit a claim under your policy. If you want information on how to submit a claim, it can be found here https://fct.ca/make-a-claim/.

    • FCT says:

      Hello,
      There are two areas of coverage in the residential owners’ policy dealing with surveys. The first deals with the forced removal of encroachments and the second deals with marketability issues arising from adverse matters disclosed by an up to date survey. The only way to get a specific coverage position on a matter would be to submit a claim under your policy. If you want information on how to submit a claim, it can be found at https://fct.ca/make-a-claim/.

  32. Randy says:

    Hello,

    What if you purchased a home with title insurance and there was work done by a contractor subsequently without a permit and the city requires you to make adjustments. Is this covered?

    • FCT says:

      Hi Randy,
      FCT’s residential owner’s policy covers situations where you are forced by a governmental authority to remove or remedy something because it was built without a permit. The work done without a permit however has to have been completed before you purchased the home. In this case, it sounds like the work was completed after you purchased the home and this is not something that is covered. Please note that this is general information only and the only way to get a coverage position on any claim is to submit it in writing. If you want more information on how to submit a claim check out our website https://www.fct.ca/make-a-claim/.

  33. Cam says:

    Hello.
    We bought a house two years ago, here recently we had a repo guy show up at our address. Why? Apparently the shed wasn’t paid off by the seller, he had been making payments until a few months ago. We had no idea it wasn’t paid off, nor did the real estate agent. The shed is listed on all of our paperwork (title insurance, mortgage..etc) and was definitely listed on our real estate listing as well. The repo company stated that we can either pay it off or give it back, what’s our recourse? We live in NC.
    Thank you

    • FCT says:

      Hi Cam,
      FCT’s residential owner’s policy covers situations when “Someone else owns an interest in your Title” and your situation may fit within the coverage of the policy. In order to get a definitive coverage position you will need to submit a claim. Our website contains all the information you will need on how to submit a claim. We take it by your comments that your property is located in North Carolina? If this is the case then you would not have a policy with FCT as we only title insure properties located in Canada.

  34. Edith Ethelston says:

    Hi I bought a house in 1992 was title insurance available in that year. Thank you

  35. Karen says:

    We purchased a home 2 years ago. We didn’t have the extra money for a home inspection. Since buying the home we had to replace oil tank and new piping for it. Found out that the wiring was not done properly in areas and now that if there was ever a fire we couldn’t get out the windows because whoever put the windows in put 2 windows back to back. How do we go about seeing if permits were given for any of them. We do have tittle insurance.

    • FCT says:

      Hi Karen,
      Most municipalities will provide you with information about the permits they have on file for a particular property. Some may charge a fee for this service so we would suggest you contact your local municipality and ask about the permits it has on file for your house. FCT’s residential owner’s policy contains coverage for circumstances where the insured is forced by a governmental authority to remove or remedy a structure because any part of it was built without a required building permit. You can find out more information on how to submit a claim on our website https://www.fct.ca/make-a-claim.

  36. T.K. says:

    Hi, I bought 29 acres in February with a recorded plat from 1987 and have title insurance but now a new surveyor is saying the land is actually 24 acres. He is also saying he surveyed the plat next door to the west (which was also originally 29 acres on their 1987 plat) but he says that one is actually 24 as well, which I don’t think is correct. He is listing two of my boundary 100 ft short! I’m having a new surveyor do another survey and he thinks the original surveys from 1987 will be correct, but will the title insurance cover the loss of acreage if the original plat of 29 acres which I closed with(and have title insurance on) is wrong?

    • FCT says:

      Hi Tanya,

      There are several areas of coverage in the residential owner’s policy that could have some applicability to this matter but the only way to get a position on coverage would be to submit a claim. Information on how to submit a claim can be found at:
      https://fct.ca/make-a-claim/

  37. Adrian says:

    There are ground windows in my house that weren’t on the blueprints which the previous owner poorly covered over outside and in. Reviewing our title insurance was suggested but I’d like to know if it would be something that would be covered as the job was done by the previous owner.

    • FCT says:

      Hi Adrian, a homeowner’s title insurance policy contains coverage for the costs of correcting work done without a required building permit if the insured is forced by a governmental authority to correct it. However, we can’t be sure if your situation falls under this. For a formal coverage position, please submit a claim at https://fct.ca/make-a-claim/.

  38. Michelle says:

    Hi we bought a property 7 years ago. We have since decided to sell the property. It has now come to light that the house required approval from a conservation authority and that approval was not given. In addition, the entire property is located in hazard lands which means the conservation authority has complete control over what you do with the property. Because of this, the property is unmarketable and we cannot sell it. Does this sort of situation fall under our title insurance policy?

    • FCT says:

      Hi Michelle, to get a formal coverage position for your particular situation, you’ll need to submit a claim on our website. However, in general, the residential owner’s policy has two areas of coverage related to conservation authorities. Covered Risk 25(c) covers losses when “You are forced to remove or remedy your existing structures or any part of them, other than a boundary wall or fence, because they are located on land under the jurisdiction of a conservation authority or similar Governmental Authority without approval” and Covered Risk 17(c) covers losses when “Another person would be permitted to refuse to perform a contract to purchase, lease or make a Mortgage loan because your existing structures or any part of them are located on land under the jurisdiction of a conservation authority or similar Governmental Authority without approval”. Hope that helps!

  39. Phil says:

    Thank you.

  40. Samantha says:

    Hi there, we bought a house back in Nov 2018 .. we found water damage in the basement when we went to do renos, we fixed that and realized it was coming somewhere from the front of the house. this past weekend we dug out the front of the house and realized when the mudroom was built from whoever built it that they did not build it probably .. they used wood for the foundation and left holes where the water is leaking into the basement .. this mudroom was definitely not build properly and now we have to tear it down fix the leaking and the do it properly. would this be covered under our title insurance?

    • FCT says:

      Hi Samantha. A residential owner’s policy contains no specific coverage for improperly built structures. However, there is coverage if you are forced by a governmental authority to remove or remedy something if it was built without a required building permit and coverage for work orders that existed on the policy date and open permits that were in existence when you bought your house. If you would like a formal coverage position on a claim, please visit the make a claim section of our site. Thanks!

  41. Phil says:

    I have a question related to encroachments. I bought my property and after 20+ years I’ve discovered that part of my driveway and a portion of a fence is actually on my neighbours property. My neighbour is not willing to sell me that portion of their property or agree to an easement.

    I’ve read above that title insurance covers situations like finding out your shed is on a neighbours property … but what does that coverage actually mean? Does it mean the title insurance may cover the costs of altering my driveway and moving the portion of the fence that is technically on my neighbours property? If my neighbour was willing to sell the portion of their property, would title insurance cover that cost? If my neighbour was willing to agree to an easement, would title insurance cover the cost of registering the easement?

    Just looking for clarification of how title insurance might help in my case. Thanks for your help.

    • FCT says:

      Hi Phil, a residential owner’s policy covers losses if you are forced to remove or remedy an existing structure because it encroaches onto adjoining land. In all parts of Canada except western Canada, the wording of the policy makes a specific exception for encroaching boundary walls and fences. In western Canada, most residential owners’ policies contain a “Boundary Wall and Fence Endorsement” which takes away the exception for boundary walls and fences. If you’re insured by FCT, you can visit our Make a claim section to provide formal notice of your claim according to the terms of your policy. Hope that helps!

  42. Kathleen says:

    I purchased my house in May 2019. We were advised during our home inspection that the deck would need new sonotubes and the floor resurfaced, but was in otherwise good condition. The sonotubes were not dug deep enough and the frost has shifted the deck to the point of leaning posts. The deck is a second story L shape deck measuring 28 x 18 at it’s longest edges and it bolted to the house. After multiple contractors came, said they would do the work and than disappeared, we had one come and tell us there was no way a contractor would fix those things because the deck is not built to code and he would be surprised if it was built with a permit.

    We contacted the city and were told that in fact, no permit was ever requested for this deck, The deck was built ten years ago after the original deck fell off the house and damaged the septic line causing a back up. The work was all done through a home insurance claim.

    The city I live in refuses to inspect the deck or tell me to take it down, but will confirm in writing that it was built without a permit

    Will title insurance cover this for the lack of permit work even though the city is not demanding it be taken down? If not, what other proof could I obtain that this is not a sound structure as was originally presented in the sale of the home?

    • FCT says:

      Hi Kathleen. A title insurance policy affords protection against the enforced removal of a structure due to construction without a permit, but it doesn’t appear that your issue would fall under the policy. That said, we would be happy to review your documentation to see if coverage might be available under a different covered risk. If you want us to proceed with this review, please visit the “Make a Claim” section of our website.

  43. Mari Peters says:

    We bought a condo with an enclosed balcony maybe sept 2018.
    the condo board association vote, approved and told all other condo owners they could have the same if they chose. No one else did, only ours. we understood we would be responsible for cost of repairs, removal, and replacing.
    Months later the association began to engage in renovation plans for the entire building.
    We had balcony enclosure inspected by engineers and we need to take it down to do renovation on balcony, all balconies need renovation.
    The board president and the board (my husband was elected to be a board member) told my husband he needed board approval to put the enclosure back up and they will NEVER approve. Condo owners told us the president has fought with them and the two prior owners over the enclosure. We had no idea before buying any of these things. Nothing was disclosed to us.
    We bought it with the enclosure, there is no rule or law that says we need approval again…we have a lawyer, he said the laws are on our side. But today he wrote that we need approval to put it back up. It was already approved with the written agreement that if it had to come down we pay for it. It’s already approved.
    We paid a much higher price for this condo because it included the balcony enclosure.
    My girlfriend’s condo association just now went thru balcony repairs and had to pay to remove hers and put it back up…no approval because it was already there and was approved and met codes. Just like ours and same balcony enclosure company that installed ours.
    Does title insurance fight for us.

    • FCT says:

      Hi Mari, that sounds frustrating! A title insurance policy provides protection against losses for matters insured against as of the date that you became the owner of the property. The condo board’s recent decision not to permit the reinstallation of your balcony enclosure would likely not be covered by the policy. That said, if you have additional information that you would like us to review and investigate further, please visit the “Make a Claim” section of our website and we’d be happy to help!

  44. Ann Marie MacLellan says:

    WE purchased our home and were not advised our home is on a private road. Now that work is required on the drainage system to bring it out of 1960 we were advised by the municipality that it will be at he cost of the residents not the municipality for this upgrade. Does title insurance assist us on this since clearly no survey or search was done and we the residents are being held accountable on this upgrade? Again we were never told we would be accountable for upgrades on our street??

    • FCT says:

      Hi Anne Marie, sorry to hear about your issue. While legal access to a property is typically covered by a title insurance policy, unfortunately, the costs to maintain a private right-of-way or road are not covered under the policy. That said, if you’d like us to fully investigate your inquiry for possible coverage, please visit the ”Make a Claim” section of our website and we’d be happy to review your documents and particular situation.

  45. Kim says:

    We bought a house with possible water damage. There was nothing too concerning when we looked at it, and in our inspection it said “the buyers should monitor back room downstairs for possible water damage” After we bought the house and moved in and all the belongings were cleared from said room, we noticed how soft the floor was and also noticed a black pipe sticking out of the floor(previously covered by piles of boxes). It was winter so we started renos on the main rec room and figured we would start on that room in the spring since the thaw would hit and we would for sure notice any water coming in at that time. The floor was completely rotten and wet at the very bottom layer. Then we ripped off 2 layers of drywall to find a 3 inch UNSEALED pipe sticking out of the cement wall. Who would put drywall over an unsealed pipe face?
    So when the thaw hit, low and behold here comes the water. My husband ran to the hardware store and bought a pump, timer and garden hose so we could pump the water out the window to our side yard so wouldn’t flood our basement. Makes you wonder what happened to the water in years past. So now we have a room and furnace room completely gutted with 2 pipes from the unknown(one in florr one in wall) and a wet floor and wet walls and told $30 000 to fix. And that is not the cost of finishing the rooms. Just to dig up our yard, add weeping tiles and seal the cement walls. And we are told not covered by title insurance. How can that be?

    • FCT says:

      Hi Kim,
      Sorry to hear about your situation. Have you checked if this is covered under your home insurance policy? Title insurance is different from home insurance in that it covers you from title and certain off-title risks. For instance, if you are forced by a governmental authority to remove or remedy your existing structures or any part of them because the work was done without permits, that could be considered a covered risk. There are around 33 risks including fraud and survey errors that are usually covered by title insurance, you can refer to your policy to see the specific coverage. If you’d like a definitive response to your situation, please see the “Make a Claim” section of our website.

  46. Karen says:

    Hi there. We bought a property with a pool which we thought complied with bylaws in regards to pool fence height. Now we find that we do not have compliance with the city or the insurance company and we need to install a higher fence. Would title insurance cover this?

    • FCT says:

      Hi Karen, is the municipality forcing you to install a higher fence? The residential owner’s policy provides coverage when “You are forced by a Governmental Authority to remove or remedy your existing structures or any part of them, other than a boundary wall or fence, because any portion of your existing structures was built without obtaining a required building permit from the proper Governmental Authority office.” If your situation falls under this and you believe you have a claim, please see the “Make a Claim” section of our website.

  47. Bruce says:

    We bought a condominium in 1982 and got title insurance much later around 2005/6. In 2017/18, a design flaw in the original construction of the underground parking was found by the Condo Board. This has resulted in a special assessment for all owners in 2019 and 2020 to bring the parking area up to code. Would the special assessment be recoverable under the title insurance, under any circumstances?

    • FCT says:

      Hi Bruce, unfortunately, it would likely not be covered as the policy obtained in 2005 or 2006 would have a policy date of the original acquisition in 1982. The special assessment coverage that the policy provides is for situations in which at the time of purchase, the condo corporation knew of an issue and failed to disclose it. In this particular case, as the defect was only discovered about 36 years after the acquisition of the unit, it would likely not fall under the coverage. If you would like a definitive coverage position from us, you can always submit a formal claim at https://fct.ca/make-a-claim/.

  48. Christie says:

    Hello! We recently purchased our first home and discovered the previous owners took out a load baring wall without permits and also closed sealed up the air circulating vents in the bedrooms. Would this be covered?

    • FCT says:

      Hi Christie,
      Our residential owner’s policy provides coverage when “You are forced by a Governmental Authority to remove or remedy your existing structures or any part of them, other than a boundary wall or fence, because any portion of your existing structures was built without obtaining a required building permit from the proper Governmental Authority office.” If you believe you have a claim, please visit the “Make a Claim” section of our website, and we’ll be happy to help!

  49. KD says:

    I purchased a property several years ago that had many known defects. These were obvious/ discovered / discover in Our home inspection.

    Over the three years that we have owned the property we have made many upgrades to resolves these known issues at our own expense including upgrading wiring, replacing a furnace and resolving issues with asbestos ducts and lack of ducts in some parts of the house. We also waterproofed a portion of the foundation from the outside.

    We have recently gutted the interior basement walls and found that there are major structural issues with the foundation. They seem to stem from the area where a previous owner opened the foundation to create a basement entrance and windows. It is unlikely that a permit was acquired to complete this work and it is obvious that at the very least these obvious structural defects (a large hole in the foundation wall for example) were visible and covered up by framing and drywall (also without permit). This is particularly obvious because th most glaring hole was stuffed full of insulation.

    What evidence would I need to seek a title insurance claim for this work?

    • FCT says:

      Hi KD,
      A residential owner’s title insurance policy provides coverage for losses when you are forced by a governmental authority to remove or remedy any part of your building because it was constructed without a required building permit. You can submit a claim on-line at https://fct.ca/make-a-claim. Just follow the instructions on our website. We will ask to see certain documentation like the agreement of purchase and sale and home inspection, but the claims handler reviewing your claim will guide you through the process.

  50. Jone says:

    Hi, I need some advice here. I try to sell my property with a Realtor and it turns out this Realtor was forwarding private information she learned from my property to the city. Instead of trying to sell my property she back stab me with lies and manipulations which now put me in trouble with the city threatened to put charges on my property if I don’t do what the city want me to do on my property. Yes I am facing a big mess from this Realtor.

    I don’t have mortgage on my property so the title is clear no mortgage. My question is do I have to buy this title insurance if my property has no mortgage on the title? Can someone like the city or a Realtor change things on the title and take my property without me knowing? How to find out the real information on a property if someone recently change the title? Thank you.

    • FCT says:

      Hi, sorry to hear you are having trouble. The issues raised in your post about your realtor are outside the scope of title insurance. If you have concerns about her behavior, you should consult the provincial regulator. Concerning your question about buying title insurance if a property has no mortgage on title, this can certainly be done and is a good idea. FCT offers a product we call an existing homeowner policy. For more information, please give us a call at 1.877.888.1153. Thank you.

  51. Tim says:

    My wife and I recently got an offer accepted on a property. The closing is soon. The property was purchased to build a family home. We decided to perform a survey of the lot prior to closing. The survey revealed significant encroachment from one of the adjacent neighbours. We would like to approach the seller about a price abatement given this fact and the impact on our build. The encroachment is approximately 5%. Therefore, we will be requesting 5% of the purchase price + legal fees as an abatement. We are concerned that the seller won’t budge on price. Assuming the seller has Title Insurance, is this something they can try claim back from their title insurance company given they were unaware of this fact when they bought the property.

    • FCT says:

      Hi Tim, generally speaking a title insurance policy insures against matters that would have been disclosed by an up to date survey. Assuming the sellers have a policy of title insurance, they should immediately submit a claim to their insurer. Because there is an on-going transaction, we would recommend that your lawyer raise the survey issues with the sellers’ lawyer.

  52. Shanna Cruz says:

    The previous owner made a bathroom renovation and did not put a heating vent. We also have a window in the bathroom, and we have noticed that moisture is building up every time we take shower. I have requested to the City if there is any permit requested prior to the renovation. If there is none, does title insurance cover for fixing the bathroom?

    • FCT says:

      Hi Shanna,
      Covered Risk 24 of the residential owner’s policy provides coverage when “You are forced by a Governmental Authority to remove or remedy your existing structures or any part of them, other than a boundary wall or fence, because any portion of your existing structures was built without obtaining a required building permit from the proper Governmental Authority office.” This coverage is expanded in western Canada to also include situations where permits have not been signed off. If your situation falls under this and you believe you have a claim, please see the “Make a Claim” section of our website.

  53. Nicole says:

    Does title insurance cancel itself out if you bought the house ‘as is’?

    • FCT says:

      Hi Nicole,
      A residential owner’s policy has an exclusion to coverage for things agreed to by the insured, but the mere fact that an agreement says the house is being purchased “as is” will not in and of itself lead to an exclusion of coverage. We sometimes see agreements of purchase and sale (especially in the context of foreclosures or powers of sale) that say the purchaser agrees to accept things like work orders, open permits or lack of permits, and if this is the case, this could lead to an exclusion of coverage. Like all insurance policies, there are exclusions to coverage to coverage in a title insurance policy, but the specific wording of the agreement of purchase and sale is very important and each case is decided on its own particular facts.

  54. Moi says:

    How does Title Insurance work for a residential rental property? A former renter left without notice and their own brand of home renos seem shoddy at best. Second hand appliances were ‘patch worked’ installed and our kitchen counter tops and cabinetry were altered and damaged in the process. An attempt to replace the bathroom floor was made, but incomplete and now the toilet leaks. I could go on, but it would be depressing. I was not aware that these alterations were being made or attempted until after the renter was long gone. This was our home before we decided to rent it out and we are guessing that the flooring was also replaced by the previous owners prior to us moving in. If we have to do a proper reno on the kitchen, would Title Insurance cover that, new flooring, cabinetry, toilets….etc?

    • FCT says:

      Hi Moi, sorry to hear that. There isn’t a significant difference on how a title insurance policy works on a residential rental property as opposed to an owner occupied property. The policy contains coverage for the costs of correcting work done without a required building permit if the insured is forced by a governmental authority to correct it. However the coverage only applies to work done before the insured becomes an owner of the property. Have you spoken to your home insurance company? We’d recommend that you check with them about your coverage. If you want a definitive coverage position from FCT, you could submit a formal claim at https://fct.ca/make-a-claim/

  55. David Cameron says:

    How about paint used to cover up an existing ceiling mould problem and within 2 months after purchasing the residence, the mould is now leaching through the paint revealing itself to the bedroom areas. Seems like it is some what fraudulent to hide and not disclose the problem. Is this something title insurance would cover?

    • FCT says:

      That’s a tough situation, David. Unfortunately this type of fraud is not covered by title insurance. Our policy includes coverage for title fraud where the ownership or title of a property is fraudulently changed or documents are forged to illegally sell or refinance the property. Have you spoken to your home insurance company? We’d recommend that you check with them about your coverage. If you would like a definitive coverage position from us, you could submit a formal claim at https://fct.ca/make-a-claim/.

  56. Scott says:

    We recently purchased an older home.. we removed the glass sliding doors on the bathtub and found mold in behind the tub surround. It appears the home owner did the tub surround. Is this something title insurance would cover.

    • FCT says:

      Hi Scott, sorry to hear that. Unfortunately there is no coverage for mold specifically in the title insurance policy. As we mentioned in our previous comment, the policy contains coverage for outstanding work orders, open building permits and the forced removal and remediation by a governmental authority because of work done without a required building permit, in addition to other coverage. If you’d like to submit a claim, please visit the “Make a Claim” section of our website and we’d be happy to help!

  57. Carla says:

    My basement wall is leaking. The basement is unfinished and I noticed cracks at all the corners of the floor. These are not leaking but I’m afraid it’s only a matter of time that they leak because of the wall. Is fixing the leaking wall covered by title insurance. I have a feeling it has leaked previously because the previous owner had things stacked up in front of that wall when we had the home inspection done.

    • FCT says:

      Hi Carla, unfortunately there is no specific coverage for leaking basements in a title insurance policy. Amongst other things the policy contains coverage for outstanding work orders, open building permits and the forced removal and remediation by a governmental authority because of work done without a required building permit. If you’d like us to investigate this for you, please visit the “Make a Claim” section of our website and we’d be happy to help!

  58. Nneka Isibor says:

    Does title insurance protect you from contractor fraud? We hired a contractor to flip a house we bought and he left the job without finishing the job. And even made it worse.

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