Florida Broker Practice Exam

What is a characteristic of the owner's policy for title insurance?

1. Transferable to new owners

2. Issued at the market price

3. Benefits the owner's heirs

4. Payable annually

The correct answer is: Benefits the owner's heirs

The owner's policy for title insurance is designed to provide protection to the property owner against any defects in the title or other claims that may arise after the purchase of the property. One significant characteristic of this policy is that it benefits the owner's heirs. This means that if the original policyholder passes away, the coverage can extend to their heirs, ensuring that they are protected against any past issues that might affect their inherited property. This feature serves to provide peace of mind regarding potential title disputes or claims that may surface after the owner's death, safeguarding the interests of the future owners of the property. In contrast, the other options do not accurately reflect the nature of the owner's policy. The policy is typically not transferable to new owners, as it is linked to the original owner and their interests. The cost of the policy is based on various factors and not strictly at market price, and it is usually a one-time premium rather than an annual payment, diverging from the concept of an ongoing, annual fee.