YOU ASK:

I am being offered the owners enhanced title insurance as part of a closing package, should I take it or shop?

WE ANSWER:

It really depends on whether you think that that is already a good deal.

However, we recommend that you shop around first, so that you have an idea of how much the premiums generally cost. You should also check exactly what additional benefits are provided in an enhanced title insurance, and see whether these additional benefits are worth buying or if you are just better off with a standard title insurance policy.

It also depends on who will be paying the title insurance. In most cases, it is the buyer who pays for the premiums of this coverage. As the one paying, you have the prerogative to choose which title insurance company you will go with.

Standard vs. Enhanced Title Insurance

To give you an idea of what is included in an enhanced policy, this provides title insurance protection plus other benefits. Some enhanced title insurance policies provide automatic increases so that you are covered for more than what you originally paid for the property.

This is in contrast with a standard title insurance policy, where the covered amount remains at the original price you paid for the property. If the property increases in value and you lose the title to this, standard insurance policy will only pay for the original cost.

Another important feature of an extended title policy is that it provides post policy protection. That means that liens placed on your house after the issuance of the policy, as well as acts of forgery or adverse possession is covered.

An extended title insurance policy also covers zoning law violations, encroachments and easements. This means that if you are required to remove existing structures that encroach on other's property or when a neighbor encroaches upon your property, the extended title insurance will help pay for it. The extended title insurance will also cover for damage caused to existing landscaping and improvements when someone claims for water and mineral rights.

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