What Is Title Insurance and Why Is It Important?
Title insurance protects you against hidden defects in a property’s ownership history — unpaid liens, forged deeds, unknown heirs — that surface after you buy. In Florida it’s a one-time premium set by the state: $5.75 per
What Title Insurance Actually Covers
When you buy a home, you’re really buying its title — the legal right to own it. A title search reviews the public records before closing, but some problems don’t show up in any search: a forged signature on a deed from decades ago, an unknown heir with a claim to the property, a contractor’s lien recorded incorrectly, or a clerical error in the county records.
Title insurance covers exactly these hidden defects. If a covered claim surfaces after closing, the insurer pays to defend your title in court and compensates you for a covered loss, up to the policy amount. Unlike homeowner’s insurance, you pay once at closing and the coverage lasts as long as you (or your heirs) own the property.
Owner’s Policy vs. Lender’s Policy
There are two separate policies, and the difference matters:
The lender’s policy protects only the bank, for the amount of the mortgage. If you’re financing the purchase, your lender will require it — you pay for it, but it protects them.
The owner’s policy protects your equity — everything you’ve put into the property. It’s technically optional, but skipping it means that if a title claim appears, the lender is covered and you are not. For most buyers, the owner’s policy is the one that actually protects their investment.
When both policies are issued together in the same transaction, Florida’s “simultaneous issue” rule prices the lender’s policy at a minimum of
On a $500,000 Miami home, that works out to $575 for the first