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Title insurance is a contract of indemnity insuring the title to real estate under the terms of the title insurance policy. Actually, the title insurance company follows the same procedure that is followed with an abstract and an attorney's title opinion. A title search is prepared and then an attorney for the title insurance company examines the record of title and points out to the title insurance company the same information that the examining attorney would point out in a title opinion. Based upon the attorney's examination the title insurance company will then issue a title insurance commitment and will issue a title insurance policy after the requirements set forth in the title insurance commitment have been satisfied. Included in the cost for title insurance is the premium charge which covers a number of risks and potential losses that are not covered by an abstract and an attorney's title opinion. The following represent examples of some of the risks covered by title insurance:
1. Forgeries in the chain of title.
2. Altered instruments.
3. Recorded instruments which were not delivered.
4. Instruments obtained by fraud or duress.
5. Instruments executed to defraud creditors.
6. The incompetence of parties to the instrument.
7. The inaccuracy of affidavits or other statements of record.
8. The recording of a copy instead of an original instrument.
9. Mistaken identity because of similar or identical names.
In addition to the foregoing and other title risks one assumes when relying upon an abstract with an attorney's title opinion, there is also the possibility that one cannot recover from an abstracter or an attorney in the event of a loss because:
1. The abstractor or the attorney who made the mistake is no longer in business.
2. The abstractor who prepared an earlier continuation in the abstract has no contractual responsibility to the person who suffered the loss.
3. The abstractor has an inadequate amount of errors and omissions insurance.
4. The abstractor has no responsibility because the abstract relied upon represented only an uncertified copy of an abstract prepared for another transaction. | 
