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Components of a Title Policy
by Sarah Holdener, Esq.
I have been promising more details on the differences between
the old 1992 ALTA policies and the new 2006 ALTA policies, and they will
come, but first I thought an explanation of the basic
components of a title policy would provide us a foundation for
later policy discussions.
All of the basic ALTA policy forms contain the same six sections, the first
three being standard language that is pre-printed on a policy jacket:
(1) The Covered Risks section list the types of
title issues that the policy protects or provides coverage against.
(2) Next the Exclusions from coverage describe broad
subject matters that are not intended to be within the indemnity protection
of a title insurance policy.
(3) The Conditions provide definitions of terms,
provide additional rights to the insured and describe the rights and
obligations of both parties.
(4) Schedule A includes information related to the
particular transaction such as the date of policy, amount of insurance
coverage, name of the insured party, a description of the insured mortgage,
the insured vested owner of the land, and a legal description of the
land.
(5) Schedule B contains Exceptions to
the coverage in the policy. This includes general, or standard
exceptions, and special exceptions.
Exceptions are intended to take away or limit coverage provided in the
insuring provisions for a specific issue or item affecting the property.
(6) Endorsements, if any, are attached.
Endorsements usually add coverage, sometimes they remove coverage, and
occasionally they are issued to amend the Conditions of the policy.
The entire title insurance policy can be essentially read together as if a
mathematical formula:
+ Covered Risks
- Exclusions from coverage
+/- Conditions of the policy
- General Exceptions
- Special Exceptions
+/- Endorsements adding or altering the terms and conditions
= Coverage of the title policy
If you are like most real estate professionals, you are far more
familiar with the Title Commitment than the Title Policy. We all look
closely at the Commitment before closing, but once that Policy is issued
it goes right to the filing cabinet. Well the Title
Commitment is exactly what it's called - a commitment to issue a
title policy to the parties and for land described in Schedule A
under the terms listed in the commitment after certain requirements or
conditions have been met. These Requirements can be
found in Schedule B1 of the commitment, and usually include
items such as: a deed from seller to buyer, a release of seller's prior
mortgage, a new mortgage from buyer to lender, release of any liens or
judgments, payment of taxes, payment of title premiums and closing fees,
etc. After closing and upon the resolution of all
open items, the Title Policy is issued in the form explained above.
Any questions can be directed to Benchmark Title at 618-239-3750. Please feel
free to call or email:
Serving you from three convenient locations:
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Main Office:
1124 Hartman Lane
Shiloh, IL 62221
Ph: 618-239-3750
Escrow Fax: 618-239-3707
Title Fax: 618-239-3757
Fax Orders: 618-310-1589
President: John Howe
www.benchmarktitle.net
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318 North Main St.
Columbia, IL 62236
Ph: 618-281-9700
Fax: 618-281-9705
Manager: Randi
Schur
4215 S. State Rte 159
Glen Carbon, IL 62034
Ph: 618-288-1695
Fax: 618-288-1852
Manager: Sara Sowell
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Upcoming Title Tips
More 2006 ALTA Policy
Changes
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time making status phone calls or standing by the fax waiting for your title
commitment when you can get what you need instantly from your own computer.
Visit SureClose.com for more
information or call April
Tolan, our SureClose Specialist, at 618-239-3750 for your sign-on so you
can start saving yourself time and money today. We'll even give you and your
clients a free CD at closing containing copies of their closing documents.
Give me my policy!
Did you know that
lenders and home buyers now receive their title policies at the closing
table? Call Michelle
Null, VP Escrow Operations, to learn more about this exciting new
program.
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homeowners will want to hear about our fantastically low new refinance rates.
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Why wait?
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Sharon Burg,
Assistant Vice President of Accounting, first ventured in to title insurance
upon joining Benchmark Title in March of 1999. She began
working for Benchmark as a closing processor, then moved into
construction disbursing. She managed the construction disbursing
unit before assuming accounting responsibilities. Before
joining Benchmark Sharon worked in construction for many years, most recently
for a contractor who did both residential and commercial construction,
handling construction disbursing and accounts payable. Sharon
lives in Collinsville with Jim Helgon, has a daughter, Michelle, and two
grandsons, Kyle and Jacob. Sharon can be reached at
618-239-3650 or by email at sburg@benchmarktitle.net.
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