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Title Abstractor Insurance Policy Information

Title Abstractor Insurance. An abstractor of title, who may also be referred to as a title abstractor, title examiner, or title searcher, has the important job of determining the ownership history of a particular property - whether it be land or real estate.

Abstracters research public records to determine the history of ownership for a parcel of land that is being transferred or sold. These records show the original state of the property, all changes or modifications, any known defects, liens, mortgages or encumbrances, and its current status.

The abstracter verifies that the land and its boundaries are described correctly and identifies any outstanding encumbrances, such as property tax or homeowners' association fees, on the property, which the current property owner must rectify before it can be sold.

Most lending institutions require an abstract indicating clear title prior to providing a loan for the purchase of real property. Purchasers of land will want an up-to-date abstract prior to the purchase of property. Some states require abstracters to be licensed.

It is thanks to these professionals that buyers can rest assured that a property they are looking to purchase is free and clear, meaning there is no lien that could later come back to haunt the buyer.

While title abstractors can find satisfying and stable employment in various settings, from real estate brokers to insurance companies or legal firms, they may also work independently and start their own businesses.

Whether you already own your own company or are considering doing so in the future, it is important to keep in mind that no amount of professional skill can prevent all unforeseen circumstances that may negatively impact your financial outlook.

Because of that, it is crucial to carefully evaluate what types of title abstractor insurance may be required. To find out more, keep reading.

Title abstractor insurance protects title examiners and searchers from lawsuits with rates as low as $37/mo. Get a fast quote and your certificate of insurance now.

Below are some answers to commonly asked title searcher insurance questions:

• What Is Title Abstractor Insurance?
• How Much Does Title Abstractor Insurance Cost?
• Why Do Title Abstractors Need Insurance?
• What Type Of Insurance Do Title Abstractors Need?
• What Does Title Abstractor Insurance Cover & Pay For?

Why Do Title Abstractors Need Insurance?

Title companies need insurance not merely to meet their legal obligations, or to allow them to work with lenders to grow their businesses, but also simply to protect them from the potentially extensive - and even, in the worst cases, bankrupting - consequences of major perils.

Title companies will, after all, be vulnerable to the same risks as nearly any other business, while also facing some risks specific to this branch of commerce.

A title company's commercial premises could be impacted by perils as varied as theft, vandalism, accidents, and acts of nature, like wildfires, hurricanes, or lightning strikes.

In these cases, the resulting expenses are likely to exceed what you can comfortably deal with in-house, and you have to keep in mind that costly business interruptions can often be added to the burden of repair and replacement costs.

In terms of liability, title companies foremost have to consider the possibility that they could be sued due to professional negligence or errors, or even fraud - and remember, such claims may be made even if you are ultimately found innocent, but still lead to exorbitant legal fees.

Furthermore, even a client slipping in your bathroom, or client data being stolen by cyber criminals, could lead to lawsuits.

Having the right type of title abstractor insurance coverage will protect you from financial burden. Should a client become injured while visiting your shop and file a lawsuit, for example, commercial insurance will cover the cost of any necessary medical bills, as well as legal fees.

Title Abstractor's Risks & Exposures

Premises liability exposure is very limited at the firm's office due to lack of public access. If clients visit the premises, they must be confined to designated areas. To prevent slips, trips, or falls, all areas accessible to clients must be well maintained with floor covering in good condition.

The number of exits must be sufficient, and be well marked, with backup lighting in case of power failure. Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls.

Off-site exposures include visits to government record facilities and contact with the general public. There should be a policy and procedure manual explaining expectations when employees are off-site.

Personal injury liability exposures include allegations of assault, breach of confidentiality, discrimination, and invasion of privacy.

Professional liability exposure can be high. Improper research can result in the property being transferred with unresolved issues regarding ownership, liens, or other encumbrances, which puts the buyer at risk of losing the property or having to pay debts incurred by previous owners.

Precise methods must be followed, and all research must be verified prior to release to the real estate company, financial institution, or buyer requesting the title search.

Workers compensation exposure is generally limited to that of an office. Since work is done on computers, potential injuries include eyestrain, neck strain, carpal tunnel syndrome, and similar cumulative trauma injuries that can be addressed through ergonomically designed workstations.

Property exposure is generally limited to an office. Ignition sources include electrical wiring, heating and air conditioning systems, wear, and overheating of equipment. Storage of paper and any materials needed to conduct research should be in fireproof cabinets. Fire suppression systems must not damage the papers. Computers and other electronic equipment may be targets for theft.

Inland marine exposure is from accounts receivable if the firm offers credit, computers, and valuable papers and records for research and clients' information. The abstracts on file are typically originals that are difficult to recreate. Power failure and power surges are potentially severe hazards.

A morale hazard may be indicated if the insured does not keep valuable papers in fireproof file cabinets to protect them from smoke, water, and fire. Duplicates should be kept off-site to allow for re-creation in the event of a loss.

Crime exposure is from employee dishonesty, including various types of fraud. Employees have access to records that may affect customers' property values and salability. Background checks should be conducted on all employees. There must be a separation of duties between persons handling deposits and disbursements and reconciling bank statements. Receipts should be issued for any cash payments received. Audits should be performed at least annually.

Business auto exposure is generally limited to hired and non-owned. If vehicles are provided to employees, there should be written procedures in place regarding personal use by employees and their family members. All drivers must have appropriate licenses and acceptable MVRs. Vehicles must be maintained and records kept in a central location.

Off-site exposures may include slips and falls, automobile accidents, and respiratory infections from a review of public records stored in older facilities.

What Does Title Abstractor Insurance Cover & Pay For?

Title Abstractors are professionals who research and analyze property titles to determine their legal status, including ownership, liens, and other claims or encumbrances. They may be sued for various reasons, including errors and omissions in their work, negligence, or breaches of contract. Professional liability insurance, also known as Errors and Omissions (E&O) insurance, can help protect Title Abstractors from the financial consequences of these lawsuits.

Errors or omissions in title reports: Title Abstractors may be sued if they make a mistake in their title reports or if they fail to include important information. For example, if a Title Abstractor fails to uncover an existing lien on a property and the new owner is later required to pay off the lien, the Abstractor could be held liable for the oversight. E&O insurance can help cover legal fees, court costs, and any settlements or judgments resulting from such a lawsuit.

Negligence: If a Title Abstractor is accused of failing to exercise the level of care and expertise that is reasonably expected from a professional in their field, they may be sued for negligence. This could occur, for example, if a Title Abstractor does not thoroughly research a property title, leading to unforeseen issues for the new owner. E&O insurance can help pay for legal defense costs and any resulting financial liabilities.

Breach of contract: If a Title Abstractor fails to fulfill the terms of their contract with a client, they may be sued for breach of contract. For example, if the Abstractor does not complete the title search within the agreed-upon timeframe, causing the client to lose out on a property transaction, the client may pursue legal action. E&O insurance can help cover the costs associated with defending against a breach of contract claim and any potential damages awarded to the plaintiff.

Misrepresentation: A Title Abstractor could be sued if they are found to have intentionally or negligently provided false or misleading information about a property title. For instance, if a Title Abstractor is aware of an easement on a property but fails to disclose it to a client, the client could sue for misrepresentation. E&O insurance can help pay for legal defense costs and damages arising from a misrepresentation claim.

In each of these examples, professional liability insurance for Title Abstractors can help protect them from the financial burdens associated with lawsuits. This type of insurance is designed to cover legal fees, court costs, settlements, and judgments, providing financial support and peace of mind for professionals in the title industry.

Commercial Insurance And Business Industry Classification

• SIC CODE: 6541 Title Abstract Offices
• NAICS CODE: 541191 Title Abstract and Settlement Offices
• Suggested Workers Compensation Code(s): 8810 Clerical Office Employees NOC

Description for 6541 Title Abstract Offices

Division H: Finance, Insurance, And Real Estate | Major Group 65: Real Estate | Industry Group 654: Title Abstract Offices

6541: Title Abstract Offices: Establishments primarily engaged in searching real estate titles. This industry does not include title insurance companies which are classified in Industry 6361.

• Title abstract companies
• Title and trust companies
• Title reconveyance companies
• Title search companies

Title Abstractor Insurance - The Bottom Line

To protect your title search business and your clients, having the right title abstractor insurance coverage is important. To see the options are available to you, how much coverage you should invest in and the cost - speak to a reputable commercial insurance agent.

Additional Resources For Professional Services Insurance

Get informed about small business professional services insurance, including Professional liability, aka errors and omissions (E&O insurance), that protects your business against claims that a professional service you provided caused your client financial loss.

• Accounting
• Actuaries
• Answering Service
• Architects
• Armored Car
• Attorney Lawyer
• Auctioneer
• Auditor
• Background Music Services
• Bookkeeping
• Business Consulting
• Chemical Engineers
• Civil Engineers
• Claims Adjuster
• Commercial Laundries
• Commodity Broker
• Corporate Wellness
• Couriers
• Court Reporter
• Credit Bureaus
• Debt Collection Agency
• Draftsman
• Detective Agency
• Diaper Services
• Electrical Engineering
• Engineering
• Environmental Consultant
• Executive, Career & Life Coaching
• Executive Search Firm
• Expert Witness
• Financial Planner
• Financial Services
• Funeral Directors
• HR Consultant
• Inspection Bureaus
• Insurance Agents & Brokers Insurance
• Interpreter
• Mediator - Arbitrator
• Medical Billing
• Music, Drama & Dance Therapy
• Notary
• Office Machine Repair & Maintenance
• Piano Tuners
• Project Management
• Safety Consultants
• Speakers Bureaus
• Stockbrokers
• Surveyor
• Tax Preparer
• Temporary Staffing
• Title Abstractors
• Valet Parking
• Specialty Consultants
• Specialty Service Business

The professional services industry, which includes occupations such as lawyers, doctors, accountants, and architects, often deals with sensitive and complex issues that carry a high risk of liability. These professionals are expected to provide their clients with expert advice and guidance, and any mistakes or oversights can result in significant financial consequences for both the client and the professional. This is where insurance comes into play.

Business insurance provides protection against the financial repercussions of potential mistakes or accidents that may occur while providing professional services. For example, a lawyer may make an error in their legal representation that leads to a financial loss for their client. Without insurance, the lawyer would be personally responsible for covering the cost of this loss. Insurance helps to protect professionals from these types of financial burdens and allows them to focus on providing high-quality services to their clients.

In addition to protecting against financial losses, commercial insurance can also provide legal defense for professionals facing legal action as a result of their work. This can be especially important for professionals in high-stress or high-risk fields, such as doctors or architects, who may be at a higher risk of being sued for professional negligence.

Overall, the professional services industry needs insurance to protect against financial losses and legal action, ensuring that professionals can continue to provide high-quality services to their clients without the added stress and burden of potential financial consequences.

Minimum recommended small business insurance coverage: Business Personal Property, Employee Dishonesty, Accounts Receivable, Computers, Valuable Papers and Records, General Liability, Employee Benefits Liability, Professional Liability, Umbrella Liability, Hired and Non-owned Auto Liability & Workers Compensation.

Other commercial insurance policies to consider: Building, Business Income with Extra Expense, Earthquake, Equipment Breakdown, Flood, Computer Fraud, Forgery, Money and Securities, Special Floater, Cyber Liability, Employment-related Practices Liability, Business Auto Liability and Physical Damage and Stop Gap Liability.