The California Land Title Association (CLTA) title insurance policy specifically insures against what?

The California Land Title Association (CLTA) title insurance policy is designed primarily to provide coverage against risks associated with recorded encumbrances. This includes various types of claims or issues related to the ownership and use of real estate that are officially documented, such as mortgages, liens, and easements. The CLTA policy typically includes pre-printed exceptions that outline specific circumstances or types of encumbrances that are not covered, emphasizing its focus on insuring against only those encumbrances that are recorded.

By concentrating on recorded encumbrances, the CLTA title insurance provides a level of protection that assures the policyholder that they will not face unexpected claims related to matters that have been properly documented in public records, thus reducing the risk of potential financial loss due to title disputes. This is particularly crucial in real estate transactions as it helps to ensure the buyer's title is clear and free from any undisclosed issues affecting ownership rights that have been officially noted.

Other options imply a broader coverage, such as non-recorded or off-record encumbrances, which are not the primary purpose of the CLTA policy. Non-recorded and off-record encumbrances can include issues such as unrecorded liens or oral agreements that the title insurance does not cover