Title insurance is characterized as what type of policy?

Title insurance is characterized as a single premium policy because it requires the insured to pay a one-time premium at the inception of the policy, which provides coverage for as long as the policyholder or their heirs hold an interest in the property. This upfront payment stands in contrast to many other types of insurance, which may require ongoing premium payments over time.

The single premium structure is particularly advantageous for title insurance because it covers risks associated with title defects that might arise after the property transaction has been completed, such as unknown liens or claims against the property. Once the policy is issued, it protects the insured from legal fees and losses due to such issues, making it a one-time purchase that provides long-term security.

In other policies such as casualty or health insurance, premiums are typically paid on a recurring basis, and they cover different types of risks. Title insurance's unique payment and coverage structure make it distinct within the realm of property-related insurances.