Which statement about the owner's title insurance policy is correct?

An owner's title insurance policy is designed to protect the property owner from potential defects in the title or claims against the property that may arise after purchase. One of the definitive characteristics of this type of insurance is that it is non-transferable. This means that if the property is sold or transferred to a new owner, the new owner must obtain their own title insurance policy. The original owner's policy does not extend to the new owner, as it is based on the title conditions and circumstances at the time of the original purchase.

This aspect is critical because it underscores the importance of new property owners assessing their title risks independently and securing their own coverage to ensure they are protected from any potential issues with the ownership claims that may not have been resolved at the time of the initial purchase. This policy is lasting and remains in effect for the duration of the owner's ownership, or until they sell the property, but it cannot be assumed by someone else, which is why it is non-transferable.