Title Insurance Claim Examples with Q&A

In commercial real estate transactions, legal issues about ownership or land use can arise, disclosed by sellers or discovered during buyer due diligence. DUAL addresses these issues, termed "Specific Risks", by providing specialized title insurance to protect against potential financial losses.

Q. When is Specific Risk Cover purchased and why?

A: Our Specific Risk Cover is typically purchased when commercial real estate is being bought, sold, developed or mortgaged/re-mortgaged. Reasons for insuring Specific Risks are many and varied. Some common reasons include:

• Transfers Risk Away: key risks and associated losses are transferred to the insurer, providing peace of mind.
• Assists with Negotiations: the policy can help to replace the need for detailed contractual indemnities or unnecessary conditions, helping to preserve commercial relationships between the parties.
• Provides a Practical Solution: remedying an identified risk can be a complex and time-consuming process or may not be an option at all. In some instances, this may cause the transaction to breakdown entirely. Specific Risk insurance offers a practical solution, helping to facilitate transactions.
• Faster and More Cost-Effective: it offers an effective solution that can be implemented faster than negotiating detailed contractual terms, saving time and costs for buyers, sellers and lenders.
• Removes the Need for Escrow: it can remove the need to hold money in escrow, simplifying transactions.
• Facilitates Financing: lenders with a conservative risk appetite may be appeased by having a Specific Risks policy in place, aiding in the facilitation of financial close.

Q. What types of Specific Risks can be covered?

A: Our policies protect against identified issues that impact ownership and/or use of the land. The list of risks we cover is not set in stone, but examples of risks we regularly insure include planning permit issues/potential breaches, certain illegal building works, land access issues, breaches of easements or covenants, known boundary encroachments, actual or potential defects in title to property interests and missing planning, building or title documentation or approvals.

Q. Who should be interested in this product?

A: This policy is relevant primarily to commercial property owners, developers, investors, vendors and/or lenders. More broadly though, this product will be of interest to those that act on behalf of such people or companies, including, property advisors, commercial real estate lawyers, real estate agents and valuers, to name a few.