Part 1: What Title Insurance Covers (And What It Doesn’t)

•April 30, 2025

More Than a Deed: What You’re Really Buying

When you buy property in Texas—whether it’s your first home, an investment property, or inherited land—you’re not just buying the physical structure or acreage. You’re buying a legal history. Title insurance is what protects you from the hidden problems that could be buried in that history.

At Philip Meyer, PLLC – Attorney at Law, we help clients across Texas navigate the legal side of real estate ownership, and we’ve seen firsthand how title insurance can be a financial lifesaver—or a source of serious confusion. This article breaks down exactly what title insurance does cover, what it doesn’t, and how to know when you may have a valid claim.

What Title Insurance Does Cover

Title insurance protects you from financial loss related to defects in the legal ownership (the “title”) of a property. These issues may not be obvious during closing, but they can surface months—or even years—later.

Common covered risks include:

Unknown liensUnpaid debts from previous owners (e.g., contractors, taxes, or HOA dues) that weren’t disclosed at closing.
Forgery or fraudFake signatures on deeds or fraudulent transfers in the chain of title.
Errors in public recordsClerical mistakes in legal filings or recording errors that affect your ownership rights.
Undisclosed heirsHeirs of a previous owner showing up with a legal claim to the property.
Encroachments or boundary disputesSurvey errors that create conflicts with neighboring properties.

If any of these issues result in a legal challenge to your ownership—or a financial hit—your title insurance may cover legal fees, settlements, or even loss of the property (depending on your policy).

What Title Insurance Doesn’t Cover

Many property owners are surprised to learn that title insurance doesn’t cover everything.

Here’s what usually falls outside the scope:

Defects you knew about before closingIf an issue was disclosed and you accepted it, it’s generally excluded.
Zoning or land use issuesTitle insurance doesn’t protect against violations of building codes or zoning laws.
Environmental hazards or physical damageThis includes mold, flooding, or structural damage—that’s a job for homeowners insurance.
Post-purchase issuesAnything that arises after you take ownership (like unpaid taxes you forget to pay) usually isn’t covered.
Boundary disputes based on new improvementsIf a fence or structure you added violates a property line, title insurance likely won’t help.

Why It Matters

A clean title is the foundation of secure property ownership. But even the most diligent buyer can’t uncover every hidden risk. That’s why title insurance exists—and why it’s important to understand the limits of that coverage. If a defect in your title causes legal or financial trouble, knowing what’s covered could make or break your next steps.

When to Talk to a Lawyer

If you’re facing a title dispute, a claim denial, or a legal demand from a third party, don’t try to resolve it alone. The earlier you involve a real estate attorney, the more options you’ll have—and the more likely you are to protect your investment.

At Philip Meyer, PLLC – Attorney at Law, we represent property owners throughout Texas in title insurance claims, real estate disputes, and litigation when necessary. We bring decades of legal experience, and we’re here to help you sort through the fine print.

Coming Up in Part 2:

Filing a Claim: Documents, Timeline, and Strategy — Learn what paperwork you need, what to expect from the title company, and how to position your claim for the best chance of success.

Disclaimer:

This article is for general informational purposes only and does not constitute legal advice. Reading this content does not establish an attorney-client relationship with Philip Meyer, PLLC. If you need legal advice specific to your situation, we encourage you to reach out to Philip Meyer PLLC – Attorney at Law—a Texas-based law firm.