Title Insurance Endorsements: The Basics
While title insurance can cover a lot of major risks, it doesn't cover everything. That's why many property owners choose to purchase one or more endorsements, or add-ons, to their title insurance policy in order to expand their coverage.
Common Types of Title Insurance Endorsements
Some of the most popular kinds of endorsements are standardized in forms created by the American Land Title Association (ALTA), a national title insurance industry group. ALTA has around 80 specific forms for title insurance endorsements, which cover a wide range of aspects, including property laws, zoning, easements, and more.
ALTA Zoning Endorsements
Some of the most common kinds of endorsements involve zoning, as this can be a major legal issue that affects property owners. Zoning endorsements fall under ALTA's 3 series endorsements. For example:
- ALTA Endorsement 3-06, Zoning Unimproved Land, is designed to protect the owners of vacant land against unanticipated zoning issues that could prevent the owner from building there.
- ALTA Endorsement 3.1-06, Zoning-Completed Structure, is designed to protect the owners of land with current buildings on it, in the case that a court order demands the removal of those buildings, or, the owner is prevented from making improvements.
Both of these endorsements will require a detailed review of zoning laws, zoning maps, and possibly the consultation of an attorney.
Environmental Protection Liens
ALTA Endorsements 8.1-06 and 8.2-06 can respectively protect residential and commercial property owners against environmental protection liens that were filed against the property and were not detected by the initial title search. Environmental liens are usually issued by the state or federal government in order to pay for past cleanup of an environmental condition on the property.
Mineral Rights, Tax Parcel Issues, Contiguity
Other common ALTA endorsement forms include:
- ALTA Endorsement 25-06, Same as Survey, protects the owner if the actual property is different than the results of a property survey.
- ALTA Endorsement 18-06 safeguards owner's if their property is not one, individual tax parcel, in order to protect against any future taxation problems or issues.
- ALTA Endorsement 19-06, which typically applies to owners who purchase multiple land parcels, in the case that there is an intervening parcel or gap.