If you’re in the process of buying a home or selling one, you know the importance of title abstracting and title insurance. Title abstracting makes sure the title of your property is free and clear so you can purchase your property legally, and title insurance protects you from title problems. But you might be wondering where title insurance originated and how long it’s been around.


You might be surprised to learn that title insurance has been around longer than you may think! At Liberty Title in Minnesota, our title insurance and title abstracting services are happy to join the historical ranks of folks protecting property owners’ investments. In this blog post, we discuss the history of title insurance and abstracting and share how it’s helped home buyers of many generations.


The Risky Business of Property Ownership

Throughout history, owning property could be a risky venture. Landowners and property owners had little recourse if there was an unexpected claim to the property or if there was a problem with the deed. It was not uncommon for a property owner to completely lose his or her investment when a problem arose with the title. If it turned out there was a fraudulent sale, the owner of the property was solely responsible for problems before he or she even owned the property.


The Importance of Insurance

Benjamin Franklin is typically credited as the inventor of modern insurance. Franklin realized that if enough people paid into a fund, they could cover the costs of anyone who sustained damage from a fire. He also invented mutual insurance for fire damage and then later proposed several other types of insurance including life insurance and crop insurance. However, it wasn’t until about a century later that title insurance was invented. The first title insurance legislation was passed in the late 19th century in Pennsylvania in response to a high-profile court case.


Conducting a Title Search

A property title is more than just evidence of who owns a property. It also conveys a complex bundle of property rights. A few examples of the very diverse rights included in this bundle are access rights, grazing rights, mineral rights, possession, acquisition, air rights, and tenancy. A title includes the history of the rights associated with a property including information about liens and easements.


A title search ensures that a new buyer of the property is getting a clear title so that the exchange of property isn’t taking away those rights from a lawful claimant. If the title search misses something important, a claim could arise down the road that threatens the new owner’s property rights. Fortunately, title insurance protects the new owner from having to pay out-of-pocket for any expenses associated with such a claim.


Title insurance protects property owners from the following:

●        Recordkeeping errors

●        Outstanding lawsuits

●        Forgery

●        Mechanic’s liens

●        Tax liens

●        And more


Minnesota Buyer Title Insurance Protection

Hundreds of years ago, there wasn’t much a property owner could do if someone appeared with a legitimate claim to their land or home. If a missing heir showed up and wished to take possession of a home, the current owners could possibly lose their investment even after years of living on a property.


Title errors are still common today, but fortunately, title insurance can protect you from such claims. Talk to our agents about title insurance by calling us at 763.494.0340, or contact us to find out more about protecting your investment with buyer’s title insurance.