<P> Joshua Morris, a conveyancer in Philadelphia, and several colleagues met on March 28, 1876 to incorporate the first title insurance company . The new firm, Real Estate Title Insurance Company of Philadelphia, would "insure the purchasers of real estate and mortgages against losses from defective titles, liens and encumbrances," and that "through these facilities, transfer of real estate and real estate securities can be made more speedily and with greater security than heretofore ." </P> <P> Morris' aunt purchased the first policy, valued at $1,500, to cover a home on North 43rd Street in Philadelphia . </P> <P> There are two types of title systems used worldwide: Land registration and land recording . </P> <P> Most of the industrialized world uses land registration systems for the transfer of land titles or interests in them . Under these systems, the government determines title ownership and encumbrances using its land registration; with only a few exceptions, the government's determination is conclusive . Governmental errors lead to monetary compensation to the person damaged by the error but that aggrieved party usually cannot recover the property . The Torrens title system is the basis for land registration systems in several common law countries . Nineteen jurisdictions in the United States, such as Minnesota and Massachusetts, adopted a form of this system between 1896 and 1917, however it fell out of favor after single judgement in Imperial County, CA, bankrupted the state's title indemnification fund, and the vast majority of U.S. states have opted for a system of document recording in which no governmental official makes any determination of who owns the title or whether the instruments transferring it are valid . </P>

Who pays for homeowners policy of title insurance