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A typical insurance policy (auto, home, health, etc.) protects you against potential future events and is paid for with monthly or annual premiums. Title insurance is not your typical insurance. A title insurance policy is paid for at the close of escrow and is a one-time premium. It protects your rights to real property against loss or damage you may experience because of liens, encumbrances, rights to, or defects in the title that might have happened in the past and come to light after you acquire the property. Possible hidden title problems can include:

  • Another person claiming an ownership interest
  • Mistakes in examining records
  • Improperly recorded documents
  • Fraud
  • Forgery