The median home value in the United States is constantly increasing post 2008 sub-prime crisis. The median home value in the United States is close to 230,000 and has increased by around 5% over the past 12 months. It is estimated this will further rise in the coming years. Today the median price per square foot of real estate in the US is $155; what this means is, all the associated industries are also experiencing significant growth over the last few years. While homeowners’ insurance is already quite popular, there are also other nascent insurance products which are experiencing phenomenal growth. For instance, title insurance and property transfer insurance are becoming quite common. Title insurance today is a $15 billion industry and is forecasted to experience accelerated growth over the next decade. Homeowners are not thinking twice before getting a title insurance and real estate players and those who wish to sell and buy properties are looking for a good property transfer insurance.
What is title insurance?
Title insurance is quite an uncommon product, because unlike any other insurance policies, that protect you against a future loss or mishap, title insurance protects you from claims of past occurrences. It might be really helpful, but it is important to discuss it with a good insurance agent. There are two types of title insurance, one that can be purchased by the real estate owner and the other is by lenders. If you are a property owner, then it is always advisable to opt for a title insurance to protect your investment. However, bear in mind that before you can get a policy, the insurance company will do an extensive title search of the concerned property. This will minimize any possible liability on your part and avoid any title issues in the future. This insurance covers errors in the public record, undiscovered liens, fraudulent paperwork or other types of frauds and omitted heirs. Unlike other insurance products, you don’t need to pay a monthly premium. Title insurance always require a single payment and the average cost of title insurance in the US is less than $900. It will be cheaper for lenders.
What is Property Transfer Insurance?
Property transfer insurance, or more precisely property transfer liability insurance is an insurance product that covers the buyer of a property, for third-party bodily injury, property damage, clean-up costs incurred due to the property and expenses incurred due to contamination that was not detected as of the policy start date. However, failure to disclose any known contamination voids the policy. It helps when you are completely transparent with the insurance company at the time of purchasing your policy.
Are Title Insurance and Property Transfer Insurance really necessary?
The claims settled percentage of both these types of insurances are less than conventional insurances. However, the problems protected by these insurances are usually unpredictable and cannot be detected by a normal home buyer or lender. Since the premium amount for these products are less, it is better to opt for these and have complete peace of mind.
Like any insurance product, it is always better to consult a reputed insurance agent and a title agency in your area. If you belong to the New York/New Jersey area then Sunnyside Title agency, is your one stop agency for all your title insurance needs. As, that will help you in getting a good deal and all the necessary information and guidance. The stakes are getting really high, with property prices sky-rocketing, as property buyers, you can never be too careful.
The backup option – Escrow Instructions:
It is not a case of either-or, because good set of escrow instructions and a title insurance always go “hand in hand.” A well‐written set of escrow instructions is a pre-requisite in any high value transaction. It provides complete protection, sometimes even with things that are not covered by simple title insurance alone. There are myriad of benefits with a good set of escrow instructions and it augments the protection offered by a conventional title insurance. If you are property buyer in addition to finding a good insurance agent, you should also find a good and affordable lawyer for this.
Good Luck
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