Bahamas Title Insurance Agency Ltd (“BTIAL”), an affiliate of Alexiou, Knowles & Co., is licensed by the Insurance Commission of The Bahamas as an agent / intermediary in The Bahamas for both Stewart Title Limited and AmTrust Title Insurance Company, two of world’s leading title insurance companies.
Through BTIAL we are pleased to be able to offer title insurance to purchasers of real estate in The Bahamas; and also to lenders who wish to have their mortgage security insured.
In February, 2015, the United States Embassy in The Bahamas issued a bulletin which emphasized the importance of obtaining title insurance in property transactions in the Bahamas.
“A significant number of U.S. citizens who have purchased or sold real estate in The Bahamas have reported tremendous difficulties in the process, some even losing their entire life savings. It is important that U.S. citizens work with a trusted attorney to make sure there is clear title to their property or proof that the sale was properly recorded or documented with the Real Property Tax Department…so please look into the availability of title insurance at the time of the purchase. Be wary of any firm/practice that tells you that title insurance is not available or that it is not needed in The Bahamas. “
What is Title Insurance?
Title insurance insures your legal title to the property against any title defects that may be discovered on the title, subsequent to you becoming the owner. Once issued, a title policy is valid for as long as the insured holds the title. The premium is a one-time payment with no renewal fees. In the case of vacant land, which is subsequently developed, we would recommend increasing the insurance coverage when the improvements are complete. Premium rates are established by Stewart Title and AmTrust. The rates are currently the same. Value Added Tax (currently 10%) will be added to the gross premium
Even the best title search and review cannot make an assessment on possible hidden title defects which are not discoverable at the time of the search. The accepted practice is that during the contract period law firms conduct a title search and issue a legal opinion on title to the purchaser or lender. The opinion will state that title is good and marketable. However, the standard legal opinions are typically heavily qualified to exclude defects which are not discoverable.
The primary benefit of title insurance is to insure you against the risk of hidden defects in addition to the security you already have in the legal opinion.
If a defect is discovered that is not excepted from coverage the title insurer will bear the costs (including legal fees and court costs) of correcting any later defect, or, if title were to be incurable, payout the face value of the policy.
How Does It Work?
In a title insured transaction, the local title insurer works closely with the attorney to thoroughly review the title and remove any potential impediment to the title. It is a rigorous and dynamic process. An attorney at Alexiou Knowles will review the title documents and conduct a title search of the Registry Records and the Supreme Court Registry to ascertain any encumbrances or defects on the title. The attorney will then work with the title insurer to determine which encumbrances are acceptable (for example, covenants and restrictions would be acceptable), and those which must be extinguished prior to completion (for example, a mortgage to be satisfied).
Once the open issues have been satisfactorily addressed, the attorney issues the legal opinion to the title insurer and the transaction moves to completion.
The title insurance policy is issued when the title deed is recorded in the Registry of Records and the premium is paid. As far as pricing is concerned, title insurance premiums are surprising affordable. We encourage prospective purchasers to contact Alexiou Knowles for more information about title insurance and the costs.
Advantages of Title Insurance
There are a number of advantages to the new property owner. There is the knowledge that the title has been carefully vetted and approved by the attorneys as well as by a reputable title insurance company. There is also the comfort that in the event that an issue is later discovered, the title insurer will step in to assist with rectifying it and bear the associated costs on the purchaser’s behalf. Additionally, in the event of a claim, the title insurer is equipped to resolve the issue swiftly and efficiently as this is their core business. Having title insurance may also makes your property more marketable when it is time to sell.