An owner's title policy would protect a buyer against which of the following?

• A. Foreclosure
• B. Zoning violations
• C. Back property taxes or other title issues
• D. HOA dues

Answer: (C)

An owner's title policy protects the buyer by insuring the title against defects that could cloud ownership or create a loss of ownership, such as liens or other issues that existed at the date of the policy. Unpaid property taxes are a classic example of a title defect that can attach a lien to the property; if those taxes weren’t discovered in the title search, the policy would help cover losses or provide a path to clear the title. So, back property taxes or other title issues are precisely the kinds of risks this insurance is designed to guard against.

Foreclosure risk from the buyer’s loan default isn’t a title defect covered by an owner's title policy, since that’s a financing default issue. Zoning violations are land-use problems, not defects in the chain of title, and HOA dues are ongoing financial obligations rather than title-ownership defects (unless there was a pre-existing lien recorded against the property).