What is "Title" ?

The word "Title" is a legal term that means you have legal ownership of property. You obtain title to property when the owner signs the deed (transfer document) over to you. Title is then registered in the government's land registration system.

What is Title Insurance ?

Title insurance is an insurance policy that protects residential or commercial property owners and their lenders against losses related to the property's title or ownership. Title Insurance protects the insured against loss resulting from title and survey defects that would otherwise have been revealed by an up-to-date survey, property report or building location certificate. Title Insurance protects the insured against losses associated with fraud and forgery as it relates to the title as well.

The fundamental difference between Title Insurance and conventionally thought of insurance is that Title Insurance protects the insured against matters that happened in the past as opposed to things that might happen in the future.

Do I Really Need Title Insurance?

Title insurance is not a requirement in Ontario. The decision on whether or not you should purchase title insurance should be discussed with your lawyer, title insurance company or insurance agent/broker, to fully understand what type of protection title insurance can provide you, and to determine if other options exist. Once you get all the facts, you can make an informed decision based on your specific situation and needs. It is important to keep in mind that title insurance does not replace legal advice when purchasing property.

What Does Title Insurance Cover ?

• Title Insurance protects the insured against loss resulting from title and survey defects that would otherwise have been revealed by an up-to-date survey, property report or building location certificate. Title Insurance also protects the insured against losses associated with fraud and forgery as it relates to the title.
• The difference between Title Insurance and conventionally thought of insurance is that Title Insurance protects the insured against matters that happened in the past as opposed to things that might happen in the future.
• There are two types of Title Insurance available and include policies for property owners and lenders. Title Insurance for owners protects the owner against loss to the owner of the property while policies for lenders ensure that the mortgage is valid and enforceable against the property. When purchased, the policy stays in effect for as long as the owner retains an interest in the property and is generally transferable in case of the owner’s death. Title Insurance is available for both residential and commercial properties.
• Taken from Chicago Title Canada, risks insured against include the following:
• The un-marketability of the Land.
• Lack of a right of access.
• Someone else has an interest in the title.
• A document is not properly signed, sealed or delivered.
• Forgery, Fraud, duress, incompetence or impersonation.
• Future frauds and forgeries affecting title.
• Defective registration of a document.
• Restrictive covenants limiting the use of the Land.
• Liens arising from mortgages, taxes, utilities, judgments’ or condominium charges.
• Builders’ Liens.
• Rights of possession arising from leases, options, family law or homestead rights.
• Easements over the Land.
• Enforced removal of existing structures because they encroach onto adjoining land or easements, or because they violate municipal by-laws.
• The house cannot be used as a single family residence because it violates a restriction or zoning by-law.

The benefit of Title Insurance is the fact that in most cases, it eliminates the requirement for a survey certificate and is generally more cost effective than having a survey completed. The policy is purchased prior to closing on the property or mortgage transaction and is typically ordered by the Lawyer or Notary prior to the purchase or registration of the mortgage.

While most properties qualify for Title Insurance, your Lawyer or Notary will advise you if the property is eligible.