Title insurance has now become such an essential part of a real estate transaction in Ontario. It is crucial to know what a standard policy in a purchase transaction covers; and more importantly, what it does NOT cover.
What is title insurance?
Title insurance protects your ownership interest (i.e. title) of your property from losses incurred as a result of unknown title defects or other covered matters that exist at the time of your purchase, but are unknown to you at that time.
~Stewart Title Guarantee Company
What does title insurance cover?
- Someone else claiming an interest in your title
- Fraud, forgery and false impersonation affecting the validity of your title
- Existing liens against the title including realty tax arrears and municipal utility charges
- Violations of municipal zoning by-laws
- Many forms of encroachment onto the property or adjoining land
- Existing work orders
- Lack of legal access to the property
- Unmarketability of land due to adverse matters that an up-to-date survey/real property report (RPR)/Building Location Certificate would have revealed
What is not covered?
- Title or other defects created, allowed, or agreed to by you
- Title or other defects known to you but not Stewart Title prior to the policy date
- Environmental matters
- Native land claims
- Matters that result in no loss to you
- Matters disclosed in home inspection or building inspection reports obtained by you