Under the current commitment form, the obligation is not intended to replace either the ALTA Owner's Policy or the ALTA Lender's Policy. Which statement best reflects this?

Under the current commitment form, the obligation is not intended to replace either the ALTA Owner's Policy or the ALTA Lender's Policy. Which statement best reflects this?

• A. It is identical to the ALTA Owner’s Policy
• B. It is identical to the ALTA Lender’s Policy
• C. It is not intended to replace either policy
• D. It replaces both policies

Answer: (C)

A title commitment sets up what will be insured and what will be excluded when the actual ALTA title policies are issued. It acts as a roadmap before closing, outlining the requirements to satisfy and the exceptions that will appear in the policies. The Owner's Policy and the Lender's Policy are the insurance documents that provide the actual coverage. Because the commitment is not the insurance itself, it cannot be identical to either policy and it does not replace them. The best statement is that the commitment is not intended to replace either policy; it simply shows what must be done and what will be excluded so the policies can be issued later.

A title commitment sets up what will be insured and what will be excluded when the actual ALTA title policies are issued. It acts as a roadmap before closing, outlining the requirements to satisfy and the exceptions that will appear in the policies. The Owner's Policy and the Lender's Policy are the insurance documents that provide the actual coverage. Because the commitment is not the insurance itself, it cannot be identical to either policy and it does not replace them. The best statement is that the commitment is not intended to replace either policy; it simply shows what must be done and what will be excluded so the policies can be issued later.