Title Insurance - Standard vs. Enhanced

Many always ask the question so I thought I would use an explination of one of my underwriters, First American Title Insurance Company.  Hopefully this will help people understand title insurance furthur and why the new "Enhanced" policies are much better!

Note: They refer to a standard policy as an "ALTA Plain Language", and their enhanced policy product to be an "Eagle" policy. 

First American's Eagle Protection Owner's Policy offers expanded title coverage for owners of one-family to four-family residences, including condominiums. It provides more coverage automatically than any previous policy...affording homeowners with the superb protection of an ALTA Plain Language Owner's Policy plus other valuable protections.

Some coverages have never before been offered by any title insurer; some were previously obtainable only by endorsement; and some even provide post-policy protection. And all are in addition to the legal defense benefit always provided by title insurance, which affords protection to the homeowner without reducing the policy amount. There is an additional premium for the Eagle Policy, but the benefits are extensive:

Automatic Increase in Policy Amount

In each of the first five years, First American will apply a percentage increase to the original policy amount, which helps to cover increases in the value of the property by raising the limit of insurance protection.

Building Permit Violation

The insured homeowner is covered if forced to remove an existing structure (excluding boundary walls and fences) because it was built by a previous owner who did not obtain a building permit from the proper government office or agency. This coverage affords an insurance benefit up to $25,000. (A deductible may apply in certain states).

Enhanced Access

This feature enhances existing right of access coverage by including both pedestrian and vehicular access. Never before has this type of access been so clearly defined.

Living Trust Coverage

With the Eagle Policy, protection extends to the trustee of a trust who receives a deed from the homeowner after the policy date.

Map Inconsistencies

The insured homeowner is protected against loss when the map attached to the policy does not show the same location/dimensions of the land as shown in the public records. This coverage--commonly provided to lenders--is now automatically afforded to homeowners with the Eagle Policy.

Post-Policy Encroachment

Here the insured homeowner is covered if, after purchase, someone builds a structure (excluding boundary walls and fences) that encroaches on the insured property. No other title policy has ever covered this situation. Now, the homeowner has protection...as First American will take corrective action or provide compensation.

Post-Policy Forgery

The insured homeowner is protected against forgeries that may occur in the future and cloud the title. This post-policy coverage has never before been available from any title insurer.

Restrictive Covenant Violations

Three important new coverages deal with violations of restrictions that occurred before the insured homeowner purchased the property. One protects against the loss of title because of the violations; another extends protection to an insured who is unable to close a sale or obtain a loan because of the violation; and a third protects against loss from attempts by others to enforce restrictions against the insured. These coverages were previously available only by endorsement, and never to this extent. Now, these unforeseen problems are covered by the Eagle Policy with only the third coverage...loss from the enforcement of restrictions. (A deductible may apply in certain states.)

Structure Damage from Minerals Extraction

The Eagle Policy protects homeowners whose structures--including those built to modify or replace existing structures--are damaged by others using the surface of the land in the course of extracting minerals. Some of this coverage was previously available by endorsement. Now it is provided automatically...and extends to structures built post-policy to modify or replace existing structures.

Subdivision Map Act Coverage

Coverage is extended to an insured homeowner who cannot close a sale, get a loan, or obtain a building permit because the land was improperly subdivided prior to the insured's purchase. This coverage was previously available only by endorsement and normally only associated with commercial properties. With the Eagle Policy, First American will pay up to $10,000 to afford protection against this often-frustrating problem. (A deductible may apply in certain states.)

Here is a chart to compare! http://www.firstamne.com/printable/misc/comp_owner.pdf