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Title insurance - does it protect my interest after transfer of property?

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rmk9785e

Junior Member
What is the name of your state (only U.S. law)? California
Not sure if this is the right sub-forum for a title insurance question. We bought a property and paid for Title Insurance during closing. Will the protection for our interest against any past issues continue after we transfer property to our child through a grant deed?
 


FlyingRon

Senior Member
First off, unless you had purchased OWNER'S title insurance as opposed to the lender's policy (which they make you pay for), you have no coverage, period.

If you have owner's coverage, it will cover you for any claims that predate the title search when you bought the policy. Yes it will cover you even after you deed the property to someone else.

Let's say you (B) by the property from (A) and at the closing buy your title insurance property. The title search appears unencumbered.
You then deed the property to (C).
C finds out that someone claims ownership dating back to before you bought from A.
If C sues you, the title insurance should cover you.

Of course your question was worded oddly. If you deed your property to another, you have no "interest" in the property to defend.
 

Zigner

Senior Member, Non-Attorney
It sounds like you want the title insurance to transfer to the child. If the child wants to be protected, then the child will need to obtain her own policy.
 

latigo

Senior Member
What is the name of your state (only U.S. law)? California
Not sure if this is the right sub-forum for a title insurance question. We bought a property and paid for Title Insurance during closing. Will the protection for our interest against any past issues continue after we transfer property to our child through a grant deed?
The coverage of your policy continues in force from the date of the policy only so long as you the named insured retains an estate or interest in the land, or so long as you hold an obligation secured by a purchase money mortgage given to you by a purchaser of the land, or so long as you shall have liability by reason of warranties in any transfer or conveyance of the title to the land.
 

rmk9785e

Junior Member
First off, unless you had purchased OWNER'S title insurance as opposed to the lender's policy (which they make you pay for), you have no coverage, period.
Yes, I purchased Owner`s Title Insurance.

If you have owner's coverage, it will cover you for any claims that predate the title search when you bought the policy. Yes it will cover you even after you deed the property to someone else.
Thank you. That`s the only interest I will have after I deed it to someone else.

It sounds like you want the title insurance to transfer to the child. If the child wants to be protected, then the child will need to obtain her own policy.
Understood. I only want my child to be protected from any claims that pre-date my acquisition of the property. As long as that is the case, am I correct in thinking that my child won`t need a policy of her own because I haven`t created any new liability on the property before transferring it to her?
 

Zigner

Senior Member, Non-Attorney
Yes, I purchased Owner`s Title Insurance.


Thank you. That`s the only interest I will have after I deed it to someone else.


Understood. I only want my child to be protected from any claims that pre-date my acquisition of the property. As long as that is the case, am I correct in thinking that my child won`t need a policy of her own because I haven`t created any new liability on the property before transferring it to her?
What if a mistake was made when YOU got the property and something was missed that is found later?

ETA: This DOES happen. On the SECOND refi of my property, a 40-year old unsatisfied lien showed up.
 

justalayman

Senior Member
What if a mistake was made when YOU got the property and something was missed that is found later?

ETA: This DOES happen. On the SECOND refi of my property, a 40-year old unsatisfied lien showed up.
But if op issued a general warranty deed to child, child could seek protection against claims against the title from dad and dads title insurance would protect his (now former) interest.

If dad uses a special warranty deed or a quit claim deed then child should purchase a owner’s policy as the claim against the title would bypass dad and go straight to the child. (Given the title issue is from a period prior to dads ownership)
 

latigo

Senior Member
Understood. I only want my child to be protected from any claims that pre-date my acquisition of the property. As long as that is the case, am I correct in thinking that my child won`t need a policy of her own because I haven`t created any new liability on the property before transferring it to her?
No, you do not "understood"!

Because of you did understand you wouldn't continue to speak in terms of your child (or any other successor in title) as being protected by YOUR title insurance policy! The "protection" - if you want to call it that - is not transferable! No more than would your auto liability insurance coverage pass to the buyer of your insured automobile.

However, the protection afforded you by the title insurance policy - that is defects in the title covered by the policy - would survive a sale of the land to the extent that you are liable to your purchaser by reason of warranties of title made in connection with your conveyance of title to the land.

For example, if you were to sued by your purchaser for breach of warranty of title and the claimed defect in the title was one that was covered in your title insurance policy, you would in turn have recourse under the indemnity provisions of the policy. Not your purchaser, but you as the named insured.
 

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