Buying or selling a home in Annapolis comes with a lot of moving parts, and title insurance is one of the most important items on your closing list. You may be wondering what it actually covers, whether you need both an owner’s and a lender’s policy, and how to budget for it. This guide breaks it down in plain language with local insights for Anne Arundel County, including waterfront and historic properties. By the end, you’ll know what is protected, what is not, and how to plan with confidence. Let’s dive in.
What title insurance covers
Title insurance protects you from financial loss due to covered defects in the property’s title that already exist on the day your policy begins. It is different from homeowners insurance, which covers future physical damage to the property. Title insurance focuses on past events that could affect your legal ownership and your ability to sell later.
Common covered issues include:
- Undisclosed or undiscovered prior liens like unpaid mortgages, judgments, or tax liens that a standard search did not catch.
- Forged or fraudulent deeds, releases, or signatures in the chain of title.
- Errors in public records, including incorrect legal descriptions or recording mistakes.
- Undisclosed heirs or missing parties that create competing ownership claims.
- Mistakes in probate or improperly executed wills that affect title.
- Legal defense costs and covered losses up to your policy limits.
Coverage applies to matters that exist at the policy date. Standard policies do not insure new problems created after you close unless you add specific endorsements.
Owner’s vs. lender’s policies
Owner’s policy
An owner’s policy protects your ownership interest, usually up to the purchase price. If a covered defect surfaces later, the policy can help pay for legal defense and covered losses. This protects your equity and your ability to sell or refinance with clear title in the future.
Lender’s policy
A lender’s policy protects the lender’s security interest in the property, usually up to the loan amount. Most lenders require it for closing. It protects the lender, not your equity, which is why an owner’s policy is typically recommended.
When coverage is effective
Both policies protect against covered defects that exist on the day the policy starts. They generally do not cover future issues created after closing unless an endorsement provides limited added protection.
What standard policies do not cover
A typical policy has exclusions. Knowing them helps you plan for endorsements or additional due diligence.
- Zoning or building code violations and land-use restrictions.
- New liens or easements created after the policy date.
- Rights of parties in possession that are not recorded and not endorsed.
- Environmental conditions or soil and structural issues.
- Survey or boundary disputes and unrecorded easements unless covered by a survey-related endorsement.
- Issues you knew about but did not disclose to the title company before closing.
Endorsements Annapolis buyers often consider
Endorsements are optional add-ons that tailor coverage to your property and your lender’s requirements. In and around Annapolis, these are commonly discussed:
- Survey or ALTA 9 endorsements to address certain survey exceptions, boundary lines, and encroachments.
- Access endorsements to confirm legal access to a public road.
- Zoning or land-use endorsements that provide limited protection related to current use.
- Mechanic’s lien, tax, or environmental endorsements with specific, limited protections.
- Condo or co-op endorsements for association-related matters.
- Gap coverage that protects during the brief period between title search and recording.
For waterfront or shoreline properties, pay close attention to riparian rights, pier and dock easements, state tidal wetlands interests, and any recorded permits. A current survey and targeted endorsements can help reduce risk. For homes in the Annapolis historic district, review any recorded preservation covenants and municipal restrictions. These items affect use and resale and should be understood before closing.
Maryland and Anne Arundel County basics
Maryland regulates title insurance through the Maryland Insurance Administration. Title insurers and agents must follow state rules. You can and should request written premium quotes from licensed Maryland title companies.
Land records in Maryland are primarily maintained at the county level. Anne Arundel County records are accessed through the state land records portal and county clerk offices. Title searches review county recordings and relevant statewide indexes to pull together the property’s ownership history, mortgages, liens, easements, and restrictions.
Local knowledge matters in Annapolis. Waterfront parcels often include easements for shared access or shoreline improvements, while older neighborhoods can have long chains of title with a higher chance of recording errors or missing releases. Work with a title company or settlement attorney experienced in Anne Arundel County.
Budgeting for title insurance in Annapolis
Title insurance premiums are a one-time cost paid at closing. You do not pay them annually. The owner’s policy premium is typically based on the purchase price. The lender’s policy premium is based on the loan amount and usually costs less since it insures a smaller amount.
Expect to see separate line items on your Closing Disclosure for:
- Owner’s title policy premium
- Lender’s title policy premium (if you are financing)
- Title search and exam fees
- Settlement or closing fee
- Recording fees for documents
- Endorsement charges if you add coverage
Who pays can vary by local custom and by contract. In some markets, sellers may cover the owner’s policy as a concession. In other cases, buyers pay. In Anne Arundel County, practices can vary neighborhood by neighborhood and change over time. Confirm the current custom with your agent and review the contract terms.
To plan your budget, ask for a written quote early from a licensed local title company or settlement agent. If you are purchasing a higher-value home, a waterfront property, or a historic property, allow extra for endorsements, a current survey, and any recommended legal review.
Choosing a title company
If you have a mortgage, your lender may have requirements for the title insurer or settlement agent. In many transactions, you can still choose among approved local providers. Ask your lender what their rules are so you understand your options.
Compare written quotes and request a sample title commitment so you can see exceptions, easements, and covenants. Ask about the underwriter, the company’s claims handling approach, and their experience with Annapolis waterfront or historic properties.
Practical checklist
Use this quick list to stay organized.
- Review the preliminary title report or commitment as soon as it is available. Focus on exceptions and restrictions.
- Ask if a current survey is recommended, especially for waterfront, boundary, or access questions.
- Discuss endorsements for survey, access, zoning, condo or co-op, and any lender-required items.
- For waterfront homes, review pier and dock permits, riparian rights, and recorded shoreline easements.
- For historic properties, confirm any recorded preservation covenants and municipal requirements.
- Request an itemized estimate showing premiums and fees for owner and lender policies.
- Disclose any known issues to the title company before closing.
How title insurance protects your closing
Even with a careful search, mistakes and omissions can occur in public records. Title insurance steps in if a covered defect appears after you close. The insurer typically provides legal defense and either cures the defect or compensates you for covered losses up to the policy limit.
Consider a common scenario in older Annapolis neighborhoods. A prior mortgage payoff release might never have been recorded, or a deed decades ago could include a misspelled name that creates a break in the chain of title. If a covered claim arises, your owner’s policy can provide legal defense and help resolve the claim so you can keep or sell your home with clear title.
Special attention for waterfront and historic homes
Annapolis and greater Anne Arundel County include many tidal and waterfront parcels. These properties may involve riparian rights, pier or dock easements, shared access across neighboring parcels, and state interests in tidal wetlands. A current survey and the right endorsements are often recommended to address access, boundary, and encroachment concerns.
If you are considering a home in the Annapolis historic district, recorded preservation covenants or landmark restrictions can affect exterior work and future renovations. These restrictions are relevant to title, even if standard policies do not insure every aspect. Make sure you review them early with your title company and your agent so your purchase plans align with recorded rules.
Flood zones are common along the Chesapeake Bay. Flood insurance and permitting are not title coverages, but related easements or recorded declarations can appear in your title report. Plan for both title and non-title items during your due diligence.
The bottom line
Title insurance is a one-time cost that helps protect your equity and your lender’s loan from hidden, past problems. In Annapolis, local factors like riparian rights, historic restrictions, and long ownership histories make careful title work and targeted endorsements especially valuable. Ask for written quotes, review the commitment, and choose a team that understands Anne Arundel County.
If you want a clear plan tailored to your property type, connect with Erica Baker. Erica pairs luxury-level service with local expertise, and she will help you coordinate with trusted title professionals so your closing is smooth from contract to keys.
FAQs
Do Annapolis buyers need an owner’s title policy?
- A lender’s policy protects the lender only, so an owner’s policy is generally recommended to protect your equity and legal defense costs.
How long does owner’s title insurance last in Maryland?
- It remains in force as long as you or your heirs hold an interest in the property, subject to the policy’s provisions, and you pay the premium only once at closing.
Can title insurance cover survey or boundary issues?
- Standard policies usually exclude unrecorded boundary disputes, but survey-related endorsements may provide limited coverage when available.
Who chooses the title company in Anne Arundel County?
- It depends on lender requirements, local custom, and your contract; in many cases the buyer can choose, subject to lender approval of the insurer.
What happens if a defect is found after closing?
- If the issue is covered, the title insurer typically defends your title and may cure the defect or pay covered losses up to policy limits, subject to policy terms.
