The American Land Title Association (ALTA) title insurance policy provides coverage against:

The American Land Title Association (ALTA) title insurance policy is designed to provide comprehensive coverage that protects property owners and lenders against various risks related to title defects. In particular, this policy provides coverage against off-record encumbrances, which include issues that may not be reflected in public records but can still affect the ownership of the property. Examples of these encumbrances include forged documents, undisclosed heirs, or other claims that were not properly recorded.

While pre-recorded encumbrances and legal disputes are important aspects of title insurance, they do not capture the full range of coverage that an ALTA policy typically provides. The ALTA policy specifically addresses both the potential risks associated with recorded items, such as liens and easements, as well as those off-record issues that can create unexpected challenges for a property owner. This comprehensive nature ensures that property owners have a level of protection against a variety of unforeseen claims that could arise after the purchase of the property.

Thus, the assertion that the policy provides coverage against only off-record encumbrances does not fully encapsulate the breadth of its protections, while the consideration of both recorded and off-record encumbrances reflects the true value of ALTA title insurance coverage.