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.

It is not a legal requirement in Ontario, however most lenders make it mandatory that buyers purchase title insurance.

The policy has a one-time fee, or premium, and may provide protection from such losses as:

  • Unknown title defects
  • Existing liens against the property’s title
  • Encroachment issues
  • Title fraud
  • Errors in surveys and public records
  • Other title-related issues that affect the ability to sell, mortgage or lease the property in the future.

The policy is in place as long as the buyer own the property and will cover losses up to a maximum coverage which is stated in the policy. It may also cover legal expenses related to restoring the property’s title.

It is important to read the policy and be aware of possible exclusions, which may include such items as:

  • Title defects disclosed prior to purchasing the property
  • Environmental hazards
  • Native land claims
  • Issues only discovered by a new survey or inspection
  • Matters not listed in public records
  • Zoning bylaw violations from changes, renovations or additions that you are responsible for creating

There are several different types of Title Insurance and a buyer should discuss these with their lawyer and make an informed decision based on their current situation and needs.

Title insurance does NOT replace legal advice when purchasing a property.

Contact an Avenue Realty Inc., Brokerage Realtor to learn how we can help.


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