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The need for title insurance arose historically from the fact that the traditional methods of mediation of real estate not sufficient security to the parties involved. Until a century ago, transferring title to real property was handled primarily by conveyancers, which are responsible were responsible for all aspects of the transaction. The conveyancer, a title to the property rights of Seller and all other rights, interests, liens or encumbrances which exist in relation to the property, and, based on the search, a signed abstract (or description) on the status of the title. conveyancer Although usually not a lawyer, that individual was considered an authority on real estate law. The origin of the title insurance directly traceable to the limited protection that the work of such a conveyancer the buyer of real estate.

In 1868, the famous case of Watson v. Muirhead (57 Pa. 161) was in Pennsylvania. In this case, Muirhead, a conveyancer, and had abstracted a title for Watson, the buyer a parcel of real estate. In good faith and after consultation with an attorney, Muirhead chosen to ignore certain recorded judgments and, for the title as good and unencumbered. On the basis of the summary Muirhead, Watson went to the purchase, but was later, and require to satisfy the liens that Muirhead did not have impairments of securities. Watson sued Muirhead to its losses, but the Pennsylvania Supreme Court ruled that there was no negligence on the part of the conveyancer and dismissed the case. Watson, an innocent purchaser who had suffered financial losses because the strain on his title, had no recourse.

The decision of Watson v. Muirhead demonstrates quite clearly that the existing system could Conveyancing no absolute certainty that the buyer of real estate, that they are safe and secure in their possession. As a consequence of this decision, shortly after the Pennsylvania legislature passed a law "necessary for the admission and regulation of title insurance companies." "The first title company was founded in 1876 in Philadelphia.

This new type of insurance (so-called "title insurance"), addressed the concerns raised in Watson v. Muirhead by providing:

1. Responsibility without proof of negligence;

2. Financial security by reducing the risk of insolvency and

3. The transfer of risks than those in public documents (for which the abstractor was not liable).

Since the late 1800s, the title insurance industry has, where it is now an essential component in an overwhelming majority of real estate transactions in this country. The services of the title insurer may be a bit of a field from one country to another, reflecting the different laws, customs and procedures of the various states and districts across the nation. But the main purpose of these services is the same - to assist all parties in real estate transactions by ensuring that the acquisition or transfer of an interest in the property can be used with maximum efficiency and safety.

Cliff Bernstein is the President of the CB-title, a title insurance company. He is a graduate of Hofstra University School of Law and a member of the Bar of the States of New York and New Jersey. He received a B.S. in accounting from the State University of New York at Albany. Prior to the CB Title, he was a consultant at Titleserv, Inc., formerly the largest independent title agency in New York. Before Titleserv, Mr. Bernstein was in connection with the real estate department of Pathmark Stores, Inc., and has been in practice at several law firms in New York, where he was involved in a variety of real estate and business transactions.