Philadelphia Fact: The Birthplace of Title Insurance

March 10, 2015

The practice of insuring title began after a Pennsylvania Supreme Court ruling in 1868 in the case Watson v. Muirhead. The decision settled the matter of ownership over a property purchased after an “abstract of title,” or title records search, was conducted.

Watson lost his investment in a real estate transaction as the result of a prior lien on the property. Muirhead, a conveyancer, had discovered a lien prior to the sale but told Watson the title was clear after his lawyer had erroneously determined that the lien was not valid. The courts ruled the conveyancer was not liable for mistakes based on professional opinions.

As a result, in 1874, the Pennsylvania legislature passed an act allowing for the incorporation of title insurance companies. On March 28, 1876, Joshua Morris, a conveyancer in Philadelphia, and several colleagues met to incorporate the first title insurance company.

Real Estate Title Insurance Company of Philadelphia issued the first title insurance policy to Morris’ aunt for $1,500, to cover a home in Philadelphia.

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