Post-Policy Fraud Endorsements Available for ALTA Owner's Policy

In 1998 the CLTA filed the CLTA Homeowner’s Policy of Title Insurance. That policy was revolutionary in that it covered the risk that someone claims a right affecting a homeowner’s title because of a post-policy forgery or impersonation. That same year the CLTA policy was adopted by the ALTA.

Now there are endorsements that allow homeowners to obtain post-policy protection in connection with an ALTA Owner’s Policy against forged deeds and mortgages. These endorsements were filed by the CLTA  with the California Department of Insurance late last year. The endorsements are designed for owners who do not have the Homeowner’s Policy of Title Insurance and the protection it provides. The endorsements arrive as stories involving deed theft and seller impersonation have become increasingly common and fueled consumer demand for protection products. (See the FBI Alert in this edition of the CLTA enews)

The CLTA 153 / ALTA 49 endorsement, formally titled the Forgery New Owners Policy Residential endorsement, can be issued at the same time as a residential ALTA Owner's Policy. 

The coverage is prospective, meaning it applies to forgery events that occur after the title policy is issued. Existing policy coverages already protect against title defects, including forgery, that occurred before the homeowner acquired the property.
The CLTA 153.1 / ALTA 49.1 endorsement extends similar protection to homeowners who already possess an Owner's Policy and want to add forgery coverage after the fact. Coverage begins on the endorsement date and applies only to forged deeds or mortgages recorded after that date. 

The endorsements are available only for improved one-to-four-family residential properties owned by natural persons or qualifying estate-planning entities. These eligibility requirements mirror those found in the Homeowner's Policy.

See CLTA Titlecast, Episode 45 – Fraud Endorsements dives into this timely and important topic - the fraud endorsements available for use in California: the CLTA 153 / ALTA 49, and the CLTA 153.1 / ALTA 49.1.