In Maryland, buyers pay for the lender’s title insurance policy (required if you have a mortgage), while sellers traditionally cover the owner’s policy — though both are negotiable in the purchase contract. Maryland title insurance premiums are state-regulated, so every company charges the same base rate. On a $900,000 Bethesda home, expect the owner’s policy to run roughly $3,800–$4,300 and the lender’s policy to add $275–$300 when issued simultaneously at the same closing.
Who Pays for Title Insurance in Maryland — and What Does It Cost?
In Maryland, there are two title insurance policies in most home purchases: the owner’s policy and the lender’s policy. Buyers pay for the lender’s policy (required by virtually every mortgage lender), while sellers traditionally cover the owner’s policy — the one that actually protects the buyer’s equity. Maryland title insurance rates are regulated by the Maryland Insurance Administration, meaning premiums are fixed statewide and cannot be negotiated by shopping between companies. On Bethesda and Montgomery County homes in the $700,000–$2,000,000 range, total title insurance costs typically run $4,000–$6,500 between both policies.
By Pey Behin | May 15, 2026
When you get your settlement sheet from the title company, one of the first things you’ll notice is a charge called “title insurance.” Maybe two of them. And if nobody’s explained this to you yet, you’re staring at a $4,000-plus line item wondering what exactly you’re paying for — and whether you’re supposed to be paying it at all.
Here’s what you need to know. In Maryland, there are two title insurance policies in almost every home purchase, and buyers and sellers typically each pay for one. But the specifics matter — especially in Bethesda and Montgomery County, where transaction costs are already among the highest in the state.
What Title Insurance Actually Protects
Title insurance protects against claims on your property that existed before you bought it — problems baked into the ownership history that no home inspection will catch. Things like:
- Unpaid liens from a previous contractor who was never paid
- Errors in public records — a wrong property description, an incorrectly recorded deed
- Forged signatures on past transfers
- Undisclosed heirs who claim a partial ownership interest
- Unpaid property taxes or HOA assessments from prior owners
These aren’t theoretical. Title defects happen. And when they do without coverage, they become your problem even though you had nothing to do with creating them. Title insurance is what prevents someone else’s history from becoming your financial loss.
A title search is conducted before issuing any policy — your settlement company combs through public records going back 40 to 60 years to verify clear ownership. Title insurance then covers what the search might miss, or what surfaces after closing.
Two Policies, Two Purposes
Every Maryland home purchase involves two separate title insurance policies, and most buyers don’t realize they’re distinct products with different beneficiaries.
Owner’s title insurance protects the buyer. It covers the buyer’s equity interest in the property for as long as they own it — and for their heirs after that. If a claim surfaces five or ten years after closing, an owner’s policy is what defends your ownership and absorbs the legal fight.
Lender’s title insurance (also called a loan policy) protects the mortgage lender, not you. It covers the lender’s interest up to the loan balance, and it’s required by virtually every lender as a condition of financing. When you pay for it, you’re not protecting yourself — you’re satisfying a lender requirement.
Both policies are typically issued at the same closing by the same settlement company. Maryland offers a simultaneous issue discount: when the lender’s policy is purchased alongside the owner’s policy at the same closing, the lender’s policy is issued at a dramatically reduced rate because the title search work has already been done.
Who Pays What in Maryland
Here’s the Maryland custom that surprises most people: the buyer pays for the lender’s policy, and the seller typically pays for the owner’s policy.
Yes — the seller pays for a policy that protects the buyer. This seems backward, but it’s rooted in Maryland practice: sellers are traditionally responsible for conveying clean title, and the owner’s policy is part of that obligation. It’s the seller’s way of guaranteeing that the title they’re transferring is insurable.
That said, neither assignment is legally required by Maryland law. The contract governs. In a competitive multiple-offer situation in Bethesda — where buyers are waiving contingencies and competing hard — you might see a buyer agree to cover their own owner’s policy to reduce friction on the seller’s side. In a slower market, or in a transaction where a seller is offering credits, the owner’s policy might shift into a broader seller concession package.
If you’re a buyer trying to understand your full closing cost picture in Bethesda, the lender’s title policy is in your column. Any seller concession that covers title-related costs would reduce your out-of-pocket accordingly.
What Title Insurance Costs in Montgomery County
Maryland is one of the few states where title insurance premiums are regulated by the Maryland Insurance Administration. Every licensed title insurance company must charge the same base rate — you cannot get a cheaper owner’s policy by shopping from one company to the next. The premium is fixed statewide.
What you can compare between settlement companies is service quality, responsiveness, local experience, and settlement fees (which are separate from the insurance premium itself).
For homes in Bethesda’s typical price range, here’s roughly what to expect:
- Owner’s title policy: approximately $3,000–$5,500, depending on purchase price
- Lender’s title policy (simultaneous issue rate): $275–$300 when issued at the same closing as the owner’s policy
- Title search fee: $200–$400 (a separate charge for the public records research conducted before the policy is issued)
On a $900,000 Bethesda purchase, the owner’s policy runs approximately $3,800–$4,300 under Maryland’s regulated rate schedule. On a $1,500,000 home, expect closer to $5,000–$6,000. The lender’s policy is a flat simultaneous-issue add-on at $275–$300 — a small number relative to what it covers.
Title insurance premiums are just one piece of a larger closing cost picture in Montgomery County. The county’s recordation tax structure is progressive and tiered — one of the most complex in Maryland — and on a $900,000 purchase, the combined transfer and recordation taxes alone can add $15,000–$20,000 in transaction costs split between buyer and seller. If you want to see exactly what sellers pay at closing, or understand how closing costs affect your net proceeds from a Bethesda sale, those breakdowns are worth reviewing before settlement day.
Is Owner’s Title Insurance Required?
The lender’s policy is required if you’re getting a mortgage. Full stop.
The owner’s policy is technically optional — but skipping it on a Bethesda home worth $800,000 or more is a risk most buyers shouldn’t take for what amounts to a one-time, non-recurring cost.
Consider what you’re protecting. If a title defect surfaces after closing — a contractor lien that wasn’t properly released years earlier, a disputed heir who claims partial ownership — your owner’s policy is what defends your equity and covers the legal cost of resolving the claim. Without it, that fight is entirely yours to fund.
The premium you pay at closing is the only premium you’ll ever pay. Unlike homeowners insurance, there’s no annual renewal. You pay once, you’re covered for the full ownership period — including any claim that emerges decades later. On a $1,000,000 home, paying $4,500 once for permanent protection is a straightforward call.
How Sellers Use Title Insurance Strategically
If you’re a seller being asked to provide a closing cost credit or concession, title-related charges are often part of the math. Sellers can package credits toward the buyer’s lender’s policy, title search fee, settlement fees, and other closing costs — structured so your sale price stays intact while giving the buyer real financial relief at the table.
In Bethesda’s $700,000–$2,000,000 range, a seller concession of $10,000–$15,000 can be configured to cover title insurance, a partial rate buydown contribution, and other buyer-side closing costs. The key is structuring it correctly in the contract so the seller’s net proceeds are predictable and the buyer gets maximum value from the credit.
This is exactly the kind of structuring conversation I walk sellers through before they respond to any offer that comes in with a concession request — the numbers need to work in both directions.
Your Settlement Company Runs This Process
In Maryland, real estate closings are handled by a settlement company (title company), not by an attorney. The settlement company conducts the title search, issues both insurance policies, coordinates the payoff of any existing mortgage, handles recordation with Montgomery County, and disburses all funds at closing.
Buyers in Maryland typically have the right to choose the settlement company. Even though premiums are fixed statewide, the settlement company’s efficiency and local expertise affect how smoothly the process goes — particularly in transactions with complex title histories, estate situations, or tight timelines. If your closing has any complexity at all, the company you choose matters more than most buyers realize.
Your agent can recommend settlement companies they’ve worked with in Bethesda and Montgomery County. In this market, a reliable settlement company is as much a part of a smooth transaction as anything else.
Frequently Asked Questions
Is title insurance the same as homeowners insurance in Maryland?
No. Homeowners insurance covers future events — fire, storm, theft, liability. Title insurance covers past events — defects in the property’s ownership history that existed before you bought it. They’re completely separate products purchased from different companies for different purposes, and both are part of the cost of owning a home.
Who chooses the title company in Maryland?
In Maryland, the buyer typically has the right to choose the settlement or title company. Even though Maryland title insurance premiums are state-regulated and identical across companies, service quality, communication, and local knowledge vary significantly. It’s worth choosing a company with strong reviews and experience in Montgomery County specifically.
How long does owner’s title insurance last?
An owner’s title insurance policy lasts for as long as you — or your heirs — own the property. There’s no renewal and no annual premium. You pay once at closing and you’re covered for the entire ownership period, including any claims that emerge years or decades later.
Can I negotiate who pays for title insurance in Maryland?
Yes. While Maryland custom puts the owner’s policy on the seller and the lender’s policy on the buyer, both are negotiable in the purchase contract. In competitive markets, buyers sometimes take on the owner’s policy cost to strengthen their offer. In softer markets, sellers may cover additional title-related costs as part of a concession package. The contract terms govern — not state law.
What does a Maryland title search look for?
A title search examines public records — typically going back 40 to 60 years — to verify clear chain of ownership, identify liens or encumbrances, confirm property tax status, and check for easements, deed restrictions, or other claims. The title insurance policy then protects you against anything the search may have missed or any defects that surface after closing.
Title insurance is one of those closing costs that most buyers don’t fully understand until they see it on the settlement sheet — and by then, it feels too late to ask questions. Understanding who pays what, and why, puts you in a better position at the negotiating table and at closing.
If you’re running the numbers on a Bethesda purchase or sale and want to see how title insurance fits into your full closing cost picture, I’m happy to walk you through a breakdown specific to your situation. Reach out anytime.
About Pey Behin
Pey Behin is a residential real estate agent serving the Washington, DC metro area, with a focus on Bethesda, Montgomery County, and Northern Virginia. He works with buyers and sellers who want clear strategy, data-driven pricing, and direct guidance throughout the transaction process. His approach combines market analytics, negotiation expertise, and modern marketing to position clients effectively in competitive conditions.
