East Bengaluru buyer answers

Does RERA require title insurance, and does it protect me?

By , acre&key · Published · Updated

Direct answer: Section 16 of the RERA Act requires the builder to obtain the insurances the appropriate Government notifies, including on the title of the land and building and on construction. The builder pays the premium, and the benefit passes to you when the agreement for sale is signed. It applies only once notified, and it doesn't replace your own title check.

Disclosure: acre&key’s advice is free to buyers; we are an authorised sales partner for some projects and may be paid by the developer.

Verify with your lawyer: This page explains the RERA Act as published, not legal advice. Have your own property lawyer review the documents for your specific flat before you sign, pay or file anything.

A title problem is hard for a buyer to spot. A forged link in the ownership chain, a co-owner who never signed, or a government claim on part of the land can come to light years after you've paid. RERA has a provision aimed at exactly this. Here's what it says, what it doesn't, and what to ask the builder.

What does section 16 say?

Section 16 is titled "Obligations of promoter regarding insurance of real estate project". In summary (RERA Act, s.16):

  1. (1) The promoter "shall obtain all such insurances as may be notified by the appropriate Government, including but not limited to insurance in respect of (i) title of the land and building as a part of the real estate project; and (ii) construction of the real estate project."
  2. (2) The promoter pays the premium and charges, and must pay them before transferring the insurance to the association of allottees.
  3. (3) The insurance "shall stand transferred to the benefit of the allottee or the association of allottees… at the time of promoter entering into an agreement for sale with the allottee."
  4. (4) On formation of the association, all insurance documents are handed over to it.

Is title insurance mandatory in Karnataka today?

Section 16(1) ties the duty to insurances "as may be notified by the appropriate Government". The Ministry of Housing and Urban Poverty Alleviation's RERA FAQ (Q51, hosted on the Karnataka RERA site) says the provision comes into effect only after, and in the manner, the appropriate Government notifies. So the practical question for a Karnataka project is whether the cover has been notified and on what terms. That's a question for your lawyer, and for the builder: ask whether any policy has been taken under section 16 for your project, and ask for a copy. If the answer is vague, treat the protection as absent and rely on your own title check.

Who pays for it?

The promoter. Section 16(2) puts the premium and charges on the promoter and says they must be paid before the insurance is transferred to the association. If a cost sheet carries a separate "title insurance" line for the buyer, ask what it is and which clause of the agreement allows it.

When does the cover pass to me?

Section 16(3) says it "shall stand transferred to the benefit of the allottee or the association of allottees" when the promoter signs the agreement for sale with you. Section 16(4) then requires the documents to be handed to the association once it's formed. That's one more item for the association's handover file; see how apartment association handover works under RERA.

Does insurance replace my own title check?

No. Insurance pays out against a covered loss on the policy's terms. It doesn't make a bad title good, and it won't help if the policy excludes the defect, has lapsed, or never existed. Your own lawyer's title search is still the main defence. See why a consultant doesn't replace your property lawyer for title and the documents to verify before paying a token advance.

What other title protections does RERA give?

Several sections work alongside section 16:

  • Section 18(2) says the promoter shall compensate the allottee for loss "due to defective title of the land", and that this claim isn't barred by limitation under any other law.
  • Section 11(4)(h) bars the promoter from mortgaging or creating a charge on your apartment after the agreement for sale, and says any such charge won't affect your rights.
  • Section 4(2)(l)(A) requires the promoter to declare, with an affidavit, that it has legal title to the land, with legally valid documents and authentication of title if the land is owned by someone else.
  • Section 4(2)(l)(B) requires a declaration that the land is free from all encumbrances, or details of any encumbrances.

The declarations are on the project's RERA page. Our guide to checking a project on the Karnataka RERA website shows where.

What should I ask the builder?

  1. Has a title insurance policy been obtained under section 16 for this project? Please share a copy.
  2. Who is the insurer, what's the sum insured, and what does it exclude?
  3. Is there a construction insurance policy too?
  4. Does the agreement for sale mention the transfer of insurance benefit under section 16(3)?
  5. Is any insurance cost being charged to buyers, and under which clause?

Keep the answers in writing with your agreement.

What about construction insurance?

Section 16(1)(ii) names a second cover: insurance "in respect of construction of the real estate project". It works on the same terms: the promoter obtains it if notified, pays the premium, and the benefit transfers under section 16(3). Construction cover is separate from the five-year defect liability in section 14(3), which is a statutory duty on the promoter whether or not any policy exists. If you find structural defects after possession, your claim against the builder doesn't depend on insurance; see defects after possession under RERA. When the association takes over, ask for both policies, the premium receipts and the claim contacts, so owners know what's covered and for how long.

Frequently asked questions

Does RERA require builders to take title insurance?

Section 16(1) requires the promoter to obtain the insurances notified by the appropriate Government, including on title of the land and building. The duty applies only once the cover is notified, so whether it applies to a Karnataka project is a point to confirm with your lawyer.

Who pays the title insurance premium under RERA?

The promoter. Section 16(2) makes the promoter liable for premium and charges, payable before the insurance is transferred to the association.

When does title insurance transfer to the buyer?

Under section 16(3), at the time the promoter enters into the agreement for sale with the allottee. The documents go to the association once it's formed.

If there's title insurance, do I still need a lawyer?

Yes. Insurance pays on a covered loss; it doesn't cure a defective title. Your own lawyer's title search remains essential.

What if the title turns out to be defective?

Section 18(2) makes the promoter compensate you for loss due to defective title of the land, and the claim isn't time-barred under other laws. Take legal advice on your case.

References

  1. Real Estate (Regulation and Development) Act, 2016, ss. 4(2)(l), 11(4)(h), 16, 18(2). https://rera.karnataka.gov.in/resources/staticpage/Real_Estate_Act.pdf, accessed 17 Oct 2026.
  2. Ministry of Housing and Urban Poverty Alleviation, RERA FAQ, Q51 (hosted by Karnataka RERA). https://rera.karnataka.gov.in/resources/staticpage/FAQ.pdf, accessed 17 Oct 2026.
  3. Karnataka RERA portal (project search and declarations). https://rera.karnataka.gov.in/, accessed 17 Oct 2026.

This page explains public rules and processes. It isn't legal or tax advice. acre&key gives buyers advice for free. We are an authorised sales partner for some projects and may be paid by the developer.

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