What Isn’t Covered by Title Insurance?

What Isn’t Covered by Title Insurance?

Louis Cyr
This should come as no surprise. In most cases, insurance, contracts and agreements impose certain conditions for users. All contain exceptions and special cases. Abri title insurance is no exception. While this insurance covers a variety of issues and helps you avoid many costs, it does not constitute all-risk insurance.
Although it is called title insurance, it is not limited to risks associated with titles. It can also cover other situations that may affect rights to using and occupying your property. These situations may also lead to significant financial losses.

What Does Abri’s Title Insurance Not Cover?

Abri’s title insurance has certain restrictions. It does not generally cover:

Problems with Wells and Septic Systems

Problems with wells and septic tanks are not covered by title insurance. This includes their operation, installation and maintenance.   Be sure to research the steps to take if you experience problems.
However, title insurance may cover problems related to encroachment of well and septic tanks on nearby lots.

Hidden Defects

Hidden defects are not covered by title insurance.  These defects include those that render properties unfit for their intended use or diminish their usefulness to the extent that the purchaser would not have bought the property or bid such a high price on it had they known.  These defects are often related to materials used in construction, be it part of the foundation, structure or roof of the house.
Buyers who find hidden defects may sue their seller directly and that seller may also sue the previous owner and so on.  The buyer benefits from general remedies such as a request to cancel the sale or decrease the sale price. To cancel the sale, the seller is required to repay the amount of the sale and the purchaser must return the property to the seller.

Quality of Construction of the House

Title insurance will not compensate you for damage due to poor construction or poor techniques used the construction contractor who built your house, cottage, etc.

A general exclusion in the policy states that the property’s physical and structural defects are not covered.

Problems Caused By the Owner

If the current owner causes a situation that could normally be covered by title insurance, he or she will be denied coverage. 

For example, if you decide to renovate your home by adding a second floor and fail to comply with municipal by-laws on height restrictions. In this case, title insurance will not be able to defend you, as you will be the sole party responsible for failing to comply with the regulations. As a result, you will be responsible for all costs associated with the infringement and for making any required adjustments.  

Environmental Risks

As an example, after purchasing your home, you learn that the basement of your home is contaminated. Even if the source of the contamination, such as an accidental oil spill, occurred before the purchase, 

a general exclusion to the policy states that environmental issues are not covered. 


An expropriation is an exceptional power that allows government agencies to take ownership of a building or require a dissolution of ownership rights on a building for public purposes. In these cases, fair and prior compensation is paid to the owner of the building or lot in question.

Government agencies include:
  • The provincial and federal government 
  • Municipalities and school boards
  • Specific organizations such as Hydro-Québec and several transportation companies
A general exclusion to the policy states that the right of government agencies to expropriate property is not covered. 

Damage covered by home insurance

Let’s distinguish between title insurance and homeowner’s insurance. As stated in the What Does Title Insurance Cover? section, title insurance generally covers everything associated with titles.
In the case of home insurance, every property owner has (or at least should have) this type of insurance. Again, homeowner’s insurance covers problems such as:
  • Water damage
  • Fire
  • Theft
  • Vandalism
  • Living expenses associated with a temporary move due to incidents like fires (risk covered by home insurance)
Home insurance also protects property within your house and on your lot. However, the items covered by your insurance may differ depending on the type of insurance you have, such as a Named Perils policy versus an All Risks policy. To avoid unexpected surprises, please contact your insurer.

The Choice is Yours!

Now that you are well acquainted with what is and isn’t covered by Abri insurance, try our online calculator to find out how much your premium would be for the property you want to insure.
Keep in mind that if you encounter any problems, Abri insurance will pay for all of your bills for risks covered by the policy.

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