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Title Insurance and the Issue of Identity Theft

October 17, 2009

As far back as 1868, Watson v Muirhead was decided by the highest court in Pennsylvania that when carrying out proper care, there was no liability in tort for carelessness on the part of a conveyance. This is the legal proceeding which gave birth to the issue of title insurance. What transpired was that the plaintiff totally lost his property and claimed that it was due to the carelessness of the conveyance.

The issue of title insurance is seriously directed to the angle of fraud. Remember that in the United States as well as in so many others countries of the world, there are so many forms of scam in the title insurance industry and the manner in which this is increasing is unbelievable. Remember that it is common to steal the identity of another simply because you want to procure a mortgage. Even in the domestic setting, it is known that the identity of a spouse can also be stolen or even that of an attorney. What is usually done is that the law ought to favour an innocent purchaser who pays for property in good faith. But given that title can only be gotten through registration in the United States, the purchaser who buys in good faith may still remain at risk. The legal principle relating to this is complex.

Scams in a Real Estate Acquisition

What most title insurers do is that they set aside the finance to take care of claims which come about as a result of identity theft. This will however be covered in the policy. Keep in mind that with the most up to date means of documenting information of clients in the title insurance industry, it is easy for an outsider to get confidential information relating to the insured. This is sometimes not only emotionally disturbing, but it can also cause a loss of fortune. This will also extend the degree of coverage that a title insurer will be liable to. Remember that indemnity for loss of income while involved in seeing that the problem gets resolved may also come up.

It is therefore evident that the issue of title insurance should be taken seriously by the landlord. Title insurance should not only be centred towards defects on title, but it should also be applicable to cases of scams and identity theft.

If you are about getting title insurance for your property, you must be a prudent buyer. This means that you have a duty of care to make sure that you have familiarised yourself with all the terms and conditions of the title insurance policy. Although it is common for most property owners to get title insurance to take care of defects in title, you should make sure that your policy provides coverage to issues such as scams or theft of identity. It is possible that most of such risks will arise after you have had a valid title to the property. There are so many title insurers who will provide coverage for these. This can be gotten as a separate coverage or it can be included in the same policy for title insurance.

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Tags: Indian Real Estate, Insurance, private lenders, real estate market
Written by Herry · Filed Under Real Estate 

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