Understanding Title Insurance Coverage:
There are generally two types of title policies issued to insure homeownership. The American Land Title Association (ALTA) Homeowner’s Policy offers the most comprehensive coverage, while the ALTA Standard Owner’s Policy provides essential coverage. However, not all policy types are available in every state. It’s important to discuss these options with your local title provider to understand which policy fits your needs.
Key Coverage Highlights:
| Coverage Area | ALTA Standard Owner’s Policy | ALTA Homeowner’s Policy |
| Someone else owns an interest in your title | ✓ | ✓ |
| Someone claims rights affecting your title due to forgery or impersonation | ✓ | ✓ |
| Your title is defective (due to invalid documents, signatures, or power of attorney) | ✓ | ✓ |
| Encumbrances, liens, and easements on your property (recorded or unrecorded) | ✓ | ✓ |
| Title lost due to a violation of a covenant or restriction | * | ✓ |
| Supplemental real estate taxes assessed due to construction or ownership changes | ** | ✓ |
| Access to and from the land based on a legal right | ** | ✓ |
| You are forced to remove or remedy existing structures for zoning violations | *** | ✓ |
| Coverage continues after transferring title to a Living Trust or a wholly-owned LLC | ✓ | ✓ |
Additional Benefits of the ALTA Homeowner’s Policy:
- Broad coverage for violations of building, zoning, and land use laws.
- Protection against unrecorded easements.
- Coverage for certain post-policy date occurrences.
- Enhanced protection for homeowners, including future enforcement actions and unmarketable title.
Important Considerations:
- The ALTA Homeowner’s Policy is designed for residential properties and offers enhanced protections compared to the standard policy.
- Some coverage areas may be subject to exceptions, limitations, or state-specific requirements.
- It’s crucial to review your policy’s terms and coverage with a qualified title insurance provider to ensure you are fully protected.
States where the policies are available: This coverage comparison applies to the following states: AL, AK, AR, CT, D.C., DE, GA, ID, IN, KS, KY, LA, ME, MD, MS, MO, NH, NE, OH, PA, SC, UT, VT, VA, and WY.
For a detailed breakdown of your title insurance options, reach out to your local title company or request a copy of the full policy language to better understand the extent of your coverage.
