Policy Provision Made Plain: Liability Noncumulative

With the recent rise in the number of fraudulent transactions, there has been a related increase in claims for complete failure of title. In these circumstances, both the insured owner and lender may have covered claims. Provision 10 of the 2021 Owner Policy, Liability Noncumulative, reduces the amount of funds available to be paid to the insured owner by the amount that the insurer has paid under a covered claim to the holder of a mortgage on the owner’s property. There has been similar language in the ALTA (American Land Title Association) policies since at least the 1970’s. Although the provision in the new 2021 polices is not new, it is still often misunderstood. Read the article