Owner's title insurance coverages

[Rick Turman]

BP family,

I've combed through the hills of the forums and have not found a straight answer on this.  Therefore I am turning to you all for help from those with more experience.

I have recently obtained a quote and coverage option for owner's title insurance on a long term buy and hold from my title agency.  I would like to know what others are choosing for total coverage needed?   Do you cover a total of what you bought the property for, all equity in, or do you cover total property value (market) given any lien comes forward over the years that lay ahead? 

Curious to see what others have done.

Thanks in advance! 

[Tom Gimer]

@Rick Turman You say "Title is clear." Those results are only as good as the person who conducted the title search. Abstractors miss things all the time. Just had one miss a $3mm indemnity deed of trust the other day. Yes, he was slightly embarrassed when I pointed out that things weren't adding up.

And aside from search errors, there are things that you can't tell are bad from the search ... such as forgery.

If something shows "later" it would only be covered by title insurance if it was recorded in between the date of the title commitment and the recording date (i.e., the "gap").

You should still buy title insurance... it protects you going forward for things (often undisclosed) that occurred in the past. Have another look at the 7 things I listed that owners' coverage responds to and tell me if you'll be comfortable without insurance (plus attorneys fees) to respond. 

No lender does business without title insurance. 1% of our buyers elect to risk it.

But of course I'm biased... so get a second, third opinion on this.