By: Jimmy Bryan
Vice President, Commercial Services Division and Title Counsel, Investors Title Insurance Company
General Counsel, North Carolina Land Title Association
When it comes to title insurance, the standard policy is only the starting point. Real estate transactions often involve unique risks, and that’s where ALTA endorsements come in. The American Land Title Association (ALTA) creates standardized endorsement forms used throughout the industry. The North Carolina Land Title Association (NCLTA) then works in concert with the North Carolina Department of Insurance (NCDOI) and the North Carolina Title Insurance Rating Bureau (NCTIRB) to ensure the endorsements, and the corresponding rates, are filed and approved for use in North Carolina.
These policy add-ons customize coverage for specific issues such as zoning, condominium ownership, future development, leaseholds, access, tax parcels, and more.
What Is an Endorsement?
An endorsement is an amendment or rider attached to a title insurance policy that provides additional or modified coverage for a particular transaction. While standard title insurance generally covers matters existing at the time the policy is issued, endorsements tailor the policy to address specific risks.
A few key points:
- Standard policies are intentionally limited. They cover many title defects existing on the policy date, but they also contain broad exclusions and exceptions.
- Endorsements narrow those gaps. They convert certain excluded risks into insured risks.
- ALTA standardizes the forms and publishes standardized policy jackets and endorsement forms used nationwide.
ALTA endorsements are one of the most important tools for tailoring title insurance coverage to the realities of a transaction. Whether the issue is zoning compliance, condominium ownership, future development, leasehold rights, access, tax parcels, or construction financing, the right endorsement can shift significant risk away from the insured party.
Because underwriting requirements vary by insurer and jurisdiction, early coordination among counsel, surveyors, lenders, and title professionals is essential to obtaining the desired coverage.
To learn more about specific ALTA endorsements and related underwriting considerations, listen to “Episode 15: Common Title Endorsement Issues” from Investors Title’s NC Title Talkpodcast series at the links provided.
