Chain of title and Insurance

A property may be transferred from one hand to other and in the whole transaction the property goes through many alterations. The registrar office maintains the records of these transfers and it is known as chain of title. A document that gives the history of ownership of land along with the current owner is known as chain of title.

It is important to maintain a record of land transactions so that all the legalities can be met with. A system known as Torrens title system is used for this purpose that helps in tracking the past and present ownership.

Since the property switches hands several times it can get dilapidated or internally damaged. The damages may be foreseen by the new owner but he/she may have to face the brunt of repairing the damages. To avoid this situation the concept of title insurance was introduced. Insurance of buildings was made mandatory in 2001 but not everybody follows this rule.

Getting insurance on chain of title can be quite beneficial. An insured property increases the confidence of a new buyer and can also aggrandize the bank formalities as an insured property seems more dependable. Insurance can increase the cost attached with the property but it ensures that the owner is investing in a secured estate.

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