General Legal Services

Title Insurance – A Quick Summary of Residential Title Insurance in Ontario

By in Real Estate Law

There are 5 companies offering title insurance in Ontario. They are:

• TitlePLUS
• Chicago Title Insurance Company
• FCT Insurance Company Ltd. (Carrying on business under the name First Canadian Title)
• Travelers Guarantee Company of Canada
• Stewart Title Guarantee Company of Canada

TitlePLUS title insurance is the only all-Canadian title insurance product currently available in the market. It was developed by Lawyers’ Professional Indemnity Company (LAWPRO®), a Canadian insurance company and subsidiary of the Law Society of Upper Canada.

TitlePLUS includes coverage for the legal services provided by the lawyer in the transaction. It is part of the standard policy. Stewart Title provides an additional coverage at an additional cost that might cover solicitor errors. FCT is licenced to provide legal services coverage, but, there is an additional annual premium that must be paid by the lawyer who acts for you and not all lawyers participate in the program. It is not part of the standard policy coverage.

To see some examples of when and how legal services coverage might come into play, you may wish to read the article by Bob Aaron that was published in the Toronto Star on April 24, 2013. The link is below:

• https://www.thestar.com/life/homes/2013/05/24/some_title_insurance_is_better_than_others.html

If you would like to find out more about each of the insurance companies and how they compare, you can go to each of their websites and find out about more about each one. You may also be able to request quotes for each one online. The links are listed below:

• www.titleplus.ca
• www.chicagotitle.ca
• www.fct.ca
• www.travelerscanada.ca
• www.stewart.ca

Most lawyers will not look after doing a detailed comparison of each insurer in terms of cost and coverage specifics for a purchaser client without charging additional fees.

You can also get some additional information about title insurance by reviewing the following document entitled “Understanding Title Insurance” prepared by the Financial Services Commission of Ontario:

• https://www.fsco.gov.on.ca/en/insurance/brochures/documents/undstitins.pdf

If you decide not to get title insurance and to get an opinion on title instead, it will be important to let your lawyer know that is your preference as early in the transaction as possible since additional searches will be required. The searches take time to request, to process and to review and if anything is uncovered as a result of one or more of the searches that you need to know about, you may need time to deal with the results. In addition the cost of your transaction is likely going to be higher since most of the additional searches require fees to be paid and requesting them, reviewing them and advising you about the results also takes your lawyer more time. The report on title is also likely to be more involved, take more time to prepare and therefore might result in additional legal fees.

Your lawyer may also have provided you with a brochure that was prepared by the Ontario Bar Association called “Working with a Lawyer when you Buy a Home”. That brochure also has information about title insurance and explains some of the differences between title insurance and an opinion on title in a chart at the end of the brochure. If you did not get the brochure or you misplaced your hard copy, the link is below:

• http://www.oba.org/en/pdf/lawyer1.pdf

Generally, the title insurance market is competitive and the cost of a policy will not likely vary significantly from one insurer to the next. The ease of making a claim and the reasonableness with which a claim is approached is also, I am told, not very different from insurer to insurer. Most clients work with the title insurer the lawyer recommends for the particular property being purchased.

If you want to know more, there is a lot of material about title insurance available. The above is intended to provide the reader with a quick overview and some easy to read and reliable resources that might help a purchaser to better understand what their options are with respect to title insurance.

For advice and information specific to your circumstances, you should consult your lawyer.