Legal Dictionary of Pakistan

title insurance

An agreement to indemnify against damage or loss arising from a defect in title to real property, usu. issued to the buyer of the property by the title company that conducted the title search. "Title insurance is normally written by specialized companies that maintain tract indexes: companies involved in writing life or casualty usually are not involved in title insurance. Title insurance is an unusual type of insurance in a few respects. For one thing, it is not a recurring policy: There is only a single premium, and a title insurance policy written on behalf of an owner theoretically remains outstanding forever to protect him or her from claims asserted by others. It is more similar to an indemnification agreement than to an insurance policy. For another, title insurance companies generally do not take risks that they know about. If the title search shows that a risk exists, the company will exclude that risk from the coverage of the policy." Robert W. Hamilton, Fundamentals of Modern Business 84 (1989).