What is title insurance?

Title insurance is a specific type of insurance designed to protect property owners from financial loss resulting from defects in the title of a property. This includes issues such as undiscovered liens, encumbrances, or ownership disputes that may arise after the purchase of the property. When a buyer acquires title insurance, they are essentially safeguarding their investment against potential legal issues related to the property’s ownership history. This is particularly important in real estate transactions, as title issues can be complex and costly to resolve.

In contrast to other options, title insurance is not focused on providing coverage for personal belongings or guaranteeing the completion of a sale. Instead, its primary function is to provide assurance that the title is clear and defend against any claims that might threaten a property owner's rights. The financial protection offered by title insurance can be invaluable in addressing unforeseen title problems that could lead to significant unexpected expenses.