Escrow & Title (alternative)
A Maryland title company discovers that a prior deed in the chain of title was forged. Under the owner's title insurance policy, the buyer is protected because:
AThe forged deed is automatically voided by Maryland courts
BTitle insurance covers forgery in the chain of title as a covered risk✓ Correct
CThe seller must reimburse the buyer
DMREC will compensate the buyer from the Guaranty Fund
Explanation
Forgery is one of the core covered risks of title insurance. An owner's policy protects the buyer against losses arising from forged documents in the chain of title.
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