Why is Title Insurance in Ireland Relevant Now, More Than Ever?
Image: Aisling Monahan, Head of Ireland and Senior Underwriter
Title insurance is a valuable asset for lenders and solicitors as it protects property owners, developers, and mortgage lenders from the potential financial losses caused by title defects.
Its relevance today, in Ireland, has never been more important, given the current real estate market conditions and the particular issue around the need for increased housing development and the continued growth of the diverse commercial sectors – biopharma, data centres and technology.
When it comes to land transactions or property development deals, one of the main responsibilities of property solicitors is to review and examine the title with a view to ascertaining that good title is being furnished. However, this is not always possible to achieve – whether this is due to time constraints or lack of information. It is insurance policies like those provided by Westcor International that gives solicitors and their clients’ peace of mind.
Unlike traditional insurance policies which focus on future risks, title insurance safeguards against latent but existing known, as well as unknown issues such as covenants and conditions contained in missing title deeds. Designed to mitigate the risks associated with defective titles, title insurance provides coverage for damages or financial losses arising from title defects, such as, unknown ownership, encroachments or improperly recorded documents.
So why is it more relevant now?
As an attractive market for investment, development is high on the agenda – from data centres to renewables and more crucially, residential development.
A title insurance policy not only truly assigns the risk to the balance sheet of a well rated insurer but it also adds value by allowing developments to progress quickly, whilst protecting the marketability as well as the value of the property.
The following are but a few examples of market conditions that title insurance can support:
Market Conditions: With predictions of slower house price growth in Ireland, the real estate market is beginning to reach a plateau. In such times, it becomes crucial to expedite transactions quickly ensuring property values are maximised.
Addressing the Housing Crisis: The Irish government is actively striving to increase housing development to combat the ongoing housing crisis. In this context, title insurance plays a vital role by accelerating land acquisition transactions, reducing the impact related to title defects, and allowing developers to initiate projects promptly. This all then culminates in faster and more predictable plot sales and a more certain “returns on equity” for developers.
While the cost of insurance may at times seem significant, it is often dwarfed by the potential benefits gained in expediting the development process.
Head of Ireland, Aisling Monahan reflects on her own experience before becoming an underwriter:
“As we are in a housing crisis and the Government is striving to facilitate more housing developments than ever before, I believe title insurance is one of the keys to unlocking this potential, which will enable all stakeholders to meet the pent-up demand. Having worked in private practice as a conveyancing solicitor for many years using title insurance policies frequently, I have firsthand experience of the benefits they offered our clients when used as an effective tool to prevent significant time delays and the increased costs associated with complex corrective conveyancing procedures…In fact, it is for these reasons that I was attracted to joining the title insurance industry – to accelerate the conveyancing revolution rather than simply accept the evolution that the profession has endured to date.”
If you would like to discuss a specific title issue or to learn more about the range of risks that can be covered in the Republic of Ireland by Westcor, Aisling can be contacted on 086 – 440 3715 or by email on firstname.lastname@example.org.