Title Insurance in BC: What It Covers and When You Need It

Title insurance is a common part of buying a home in BC, but what it actually covers is often unclear. Here is what it covers, what it leaves out, how it fits with the protection BC's land title system already gives you, and when it is most worth having.

The short version

What title insurance is

Title insurance is a policy that protects property owners, their lenders or both against losses related to a property's title or ownership. You pay a one-time premium, and the cost generally depends on the property's value and the insurer. Your lawyer or notary usually orders it when you buy or refinance.

The Financial Consumer Agency of Canada lists title insurance among the usual closing costs, along with legal fees, inspections and property tax adjustments. I go through the rest of that list in Closing Costs in BC.

Owner's and lender's policies

• A lender's policy protects the lender if its mortgage turns out to be invalid or unenforceable, usually for the amount of the mortgage. Scotiabank, for example, notes that many lenders require one as a condition of financing, that it protects only the lender's interests, and that the buyer typically pays the premium at closing.
• An owner's policy protects you against the title-related losses listed in the policy, up to a maximum amount. Insurers describe the coverage as lasting for as long as you own the home, and it is generally optional.

If your lender requires a policy, ask your lawyer or notary whether an owner's policy is included too. A lender's policy on its own doesn't protect you.

Why lenders accept it

Title insurance covers risks that BC's land title system leaves with the lender. Under the Land Title Act, a mortgage registered on a forged document generally gives the lender no interest in the land, so a lender that advances money to an impostor is the one who loses. A lender's policy covers an invalid mortgage without anyone having to prove who was at fault.

It can also stand in for a survey. The Law Society of BC's conveyancing checklist tells lawyers that if no survey certificate is available, the buyer should get a survey or consider title insurance, and that a lender will usually require a survey, title insurance or a legal opinion it accepts. A survey certificate is used to check for encroachments and bylaw problems; title insurance instead covers the losses those problems can cause, and it can save you the cost of a new survey.

What BC's land title system already protects

BC's land title system, run by the Land Title and Survey Authority (LTSA), is based on the Torrens system, in which title is guaranteed. That gives owners real protection:

• Your title is conclusive. Under the Land Title Act, a title is conclusive evidence of who owns the land, subject to listed exceptions such as taxes and municipal charges that may become liens, leases of three years or less where the tenant is in occupation, public rights of way, and wrongly described boundaries.
• Forged mortgages generally fail. A void document, such as a forged mortgage, generally gives the person relying on it no interest in the land. The main exception protects a buyer who pays for a home in good faith, even if the seller was an impostor.
• The assurance fund. If you lose land through fraud or a wrongful registration and the law prevents you from getting it back, you can sue the person responsible, and LTSA's assurance fund pays if they can't, or can't be found in BC. The fund also covers losses caused by mistakes at the land title office.

The fund has limits, though. Compensation can't exceed the value of the land at the time of the loss, and the fund doesn't pay for misdescribed boundaries, a shortage in a lot's area on a filed plan, or the share of a loss you caused or contributed to. Claims are made by court action, which generally has to start within three years of discovering the loss, though LTSA can also settle a claim out of court. Some problems may never appear on title at all, such as a neighbour's garage over the property line or a suite built without a permit.

What an owner's policy usually covers

Coverage depends on the policy wording, but insurers' published summaries and BCREA's Legally Speaking commonly list:

• Title fraud and forgery, including the legal costs of proving the fraud.
• Unknown title defects and errors in public records.
• A previous owner's unpaid debts registered against the property, such as property taxes, utilities, a mortgage or strata fees.
• Survey problems, such as encroachments and unregistered easements.
• Work done without permits, including the cost of removing or fixing it if the City requires that, as long as you didn't do the work yourself.
• Outstanding work orders issued against the property.

Common exclusions

• Problems you knew about. Policies generally exclude known title defects and anything you knew about but didn't disclose to the insurer before closing, such as an issue found in your home inspection. Insurers sometimes give limited coverage for known problems disclosed before completion, so ask.
• Environmental hazards, such as contaminated soil.
• Indigenous land claims, which published guides list among the usual exclusions.
• Anything you create or agree to, such as work you do without a permit after you buy.
• The home's condition. Title insurance doesn't cover problems unrelated to title, so a leaking roof or a failing furnace isn't covered.

That is why title insurance doesn't replace a home inspection. I explain what an inspection does and doesn't cover in Home Inspections in BC.

When title insurance is most useful

• Additions of unknown history. If a previous owner built a suite, deck or addition without permits and the City later orders it removed or fixed, an owner's policy may pay, as long as you didn't know about the problem when you bought.
• No up-to-date survey. Without a current survey certificate, you may not know whether a fence, garage or neighbour's building crosses the property line. An owner's policy commonly covers encroachments, which the land title system doesn't.
• Fraud. On August 4, 2026, LTSA warned that fraudsters were using falsified identification to take out new mortgages on homes in Surrey, Delta, New Westminster and Burnaby, typically homes with clear title or an older mortgage with a low balance. BC law generally protects owners from forged mortgages, but sorting one out can take legal work, which an owner's policy can cover. LTSA also suggests monitoring your title. Its new BC Property Connect service alerts verified owners to pending changes, so check whether you can sign up.
• A home you already own. You can buy an owner's policy after the fact, although policies for existing homeowners are slightly different from those issued when you buy.

Getting a policy

• Ask early. When you hire your lawyer or notary, ask whether your lender requires title insurance, whether an owner's policy is included, and what the premium is.
• Disclose what you know. If you know of an unpermitted suite, a fence over the line or anything similar, raise it before completion, since known problems are generally excluded unless the insurer agrees to cover them.
• Keep the policy. If a problem comes up, check what the policy covers and make your claim in writing as soon as possible, with your policy number.

Questions buyers often ask me

Is title insurance required in BC?

Many lenders require a lender's policy as a condition of financing, though a lender may accept a survey or another option instead. An owner's policy is generally optional, so ask your lawyer or notary what your lender needs and what you would be covered for.

How much does title insurance cost?

It is a one-time premium, usually paid at closing, that generally depends on the property's value and the insurer. Ask your lawyer or notary to include it in their written quote.

Does title insurance replace a home inspection?

No. It covers problems with the title, not the home's condition, and it generally excludes problems you knew about before closing, including those found in an inspection.

Can I buy title insurance for a home I already own?

Yes. Owner's policies can be bought after the purchase, although policies for existing homeowners are slightly different from those issued when you buy.

If BC has an assurance fund, why buy title insurance?

The fund compensates owners who lose land through fraud, a wrongful registration or a land title office mistake, up to the land's value, and claims usually go to court. It doesn't cover problems such as work done without permits, encroachments or a previous owner's unpaid bills, which an owner's policy may.

Planning your purchase? See what else to budget for in Closing Costs in BC, what an inspection can tell you in Home Inspections in BC, and how the steps fit together in From Offer to Keys.

This article is general information, not legal advice. Policies differ, so read yours and ask your lawyer or notary about anything you are unsure of. The details come from the Land Title Act, LTSA, the Law Society of BC, BCREA and published lender and insurer terms, and were current at the time of writing. For BCREA's Legally Speaking article, see title insurance.