Posted by michaela-ATL on October 12, 2003 at 07:23:19:
It’s kind of like car insurance. Let’s say you have an accident and someone else is at fault. You will contact your insurance company and they will pay you. As far as you’re concerned it’s over. The insurance company then goes on and goes after the party at fault or their insurance company.
Same goes with title insurance, as I’ve been explained by an attorney. Yes, the title company makes good on he title flaw, but if there’s someone they can go after to get their money back, then they will. So, if you sign a warranty deed, saying, that there’re no title flaws, then you lied and they might come after you.
Also, keep in mind, that the attorney, that did the title search and insured the title, might not want to report this to their insurance compnay, because their premium might go up. So, maybe they go ahead and pay out of pocket and then go after you, because you signed that warranty deed.
Maybe that would happen, maybe not, but I’ve been in a situation, where I would have been screwed without title insurance, so it’s money well spent for me.