The ALTA Insurance Policy is one that uses agreed upon standard language and terminology, as set out by the American Land Title Association, or ALTA. When you are purchasing a property, you will go through a title search and then a title insurance policy will be issued. All title insurance companies should use an ALTA Insurance policy for the best protection.

The ALTA is the governing body of title insurance companies, and they have a membership that is made up of those in the title insurance business. Just because they are not a member of ALTA does not mean they are not trustworthy, but an ALTA Insurance policy is the most accepted because of the standard definitions for the terminology used in title insurance policies.

You can tell if your policy is an ALTA insurance policy because the title insurance policy "jacket" will have the standard terms and conditions as defined by ALTA. It is a standard title insurance policy and it is widely used. In fact, members of ALTA can go to their website for training resources and forms and that is where the conditions, terms, and definitions can be found, also.

When you are purchasing a piece of real property, a title search will check public records and the abstract of title. The insurance policy may be listed with exceptions, which are circumstances that the policy will not cover, should they arise. Utility easements are common, but other things may be exceptions, based on ALTA guidelines. If you have questions regarding what certain things mean and your policy is an ALTA insurance policy, there are clear-cut meanings to everything contained in the policy through their guidelines.

The other thing to consider is that ALTA insurance policies have additional things included to protect a lender's interest. A regular owner's title policy may not have the same strength that an ALTA insurance policy carries. Sometimes, you may hear ALTA insurance policies referred to as "Lenders Title Insurance Policy" for this reason.

In 2007, ALTA launched "The Title Industry Consumer Initiative" meant to outline the five-point strategy for improving the title insurance industry and to help educate and protect consumers, when it comes to their title insurance and title-related services, such as searches and recordings. They also offer helpful hints regarding closing on your real estate transactions. Because ALTA is the association that governs the title insurance membership, it gives the consumer a place to turn if they encounter questions or problems with their title insurance policy.

Because purchasing property can be confusing and come with many potholes, it is best if you can understand the process of closing and your title insurance and what it covers. Through an ALTA title insurance policy, these standards are laid out and are meant to be followed by the title insurance company, as their standard of definitions, and conditions dictate. Because ALTA has a policy forms licensing function, ALTA insurance policies have passed these standards and the consumer and lender should be adequately protected. Any exceptions noted, will not be covered, so if you have questions regarding these, then you just have to ask the title insurance company or ALTA to explain.