A Global Perspective on Title Insurance

Title insurance indemnifies the holder of a right in real property for losses caused by title defects that exist but are unknown at the date of policy. It first appeared in the United States in the last third of the 19th century, to complement the personal liability and the errors and omissions insurance of professionals examining title quality. Being a residual claimant, the insurer is strongly motivated to search the available evidence for any title defect before issuing the policy (risk screening). Defects which are discovered in the search are either excluded from coverage or purged. The insurer is also motivated to ensure that a correct settlement of the transaction takes place (risk avoidance).