Which term describes insuring, guaranteeing, or indemnifying an owner of real property against loss due to liens or defects in title?

Which term describes insuring, guaranteeing, or indemnifying an owner of real property against loss due to liens or defects in title?

• A. Title Insurance
• B. Property Insurance
• C. Hazard Insurance
• D. Homeowners Insurance

Answer: (A)

The concept here is title protection for a property owner. Title insurance provides coverage against losses that can arise from defects in the title or liens that could threaten the owner's ownership, even if those issues aren’t found during the title search. It protects the owner's financial interest by either defending the title or compensating for losses up to the policy amount. This is different from property, hazard, or homeowners insurance, which cover physical damage to the property, theft, personal liability, or disasters. Those policies don’t insure against problems with who actually owns the title or disputes about encumbrances. Title insurance specifically addresses risks to ownership itself, such as undiscovered liens, forged documents, or errors in public records.

The concept here is title protection for a property owner. Title insurance provides coverage against losses that can arise from defects in the title or liens that could threaten the owner's ownership, even if those issues aren’t found during the title search. It protects the owner's financial interest by either defending the title or compensating for losses up to the policy amount.

This is different from property, hazard, or homeowners insurance, which cover physical damage to the property, theft, personal liability, or disasters. Those policies don’t insure against problems with who actually owns the title or disputes about encumbrances. Title insurance specifically addresses risks to ownership itself, such as undiscovered liens, forged documents, or errors in public records.