Escrow & Title
A Mississippi buyer purchases a home and receives an ALTA owner's title insurance policy. Years later, a previously unknown heir to the property makes a claim. The title insurer:
AHas no obligation since the claim arose after closing
BWill defend the claim and compensate the buyer if the claim results in a title loss, up to the policy amount✓ Correct
CWill only compensate if the buyer wins in court
DWill require the buyer to first exhaust all legal remedies
Explanation
Owner's title insurance protects against covered title claims that arise after closing, including claims from unknown heirs. The insurer has a duty to defend the insured against covered claims and to compensate for actual losses up to the policy amount if the claim results in a title defect.
Related Mississippi Escrow & Title Questions
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