Title Company Insurance in Washington State

Title companies occupy one of the most liability-intensive positions in the real estate transaction ecosystem. Your firm researches ownership history, identifies liens, issues title insurance policies guaranteeing clear title, and manages escrow accounts holding hundreds of thousands of dollars per transaction. A single missed lien, an undetected forgery in the chain of title, an escrow error, or a wire transfer misdirected by a cybercriminal can produce losses that dwarf your annual revenue. In Washington, where the Office of Insurance Commissioner (OIC) regulates title insurance and Puget Sound transaction volumes are enormous, the exposure is both constant and severe.

Professional liability is the foundational coverage for any title company. E&O claims arise from title defects your search failed to uncover: undisclosed easements, unreleased mortgages, boundary disputes, forged deeds, unpaid property taxes, and mechanic's liens from prior construction. Unlike many professional liability scenarios where damages are speculative, title defect claims involve concrete losses — the cost to clear the defect, diminished property value, or the lender's loss on a loan secured by defective title. Washington's recording system, maintained by county auditors, is generally reliable, but older records, handwritten documents, and gaps in the chain for properties that have changed hands many times create real risks that experienced professionals can still miss.

Wire fraud and cyber theft have become the single most urgent operational risk for Washington title companies. Real estate wire fraud has reached epidemic proportions, and title companies are the primary target because they manage the largest fund transfers in any transaction. Criminals compromise email accounts and send fraudulent wiring instructions that redirect closing funds to fraudulent accounts. Once sent, recovery is rarely possible. Washington's data breach notification law adds regulatory exposure when client data is compromised. Cyber liability covering social engineering fraud, funds transfer fraud, and breach response is now as essential as E&O coverage.

Fidelity bonds address the internal fraud risk inherent in handling large escrow balances. The Washington OIC requires title agents to maintain fidelity coverage, and underwriters mandate it for agency appointments. An employee who diverts escrow funds can create catastrophic losses and regulatory consequences. General liability covers your office premises, The title industry's unique combination of fiduciary responsibility, regulatory oversight, and cyber exposure makes comprehensive coverage a non-negotiable requirement for doing business in Washington.