The basic answer is it protects you from 'defects' with the title. The title is what you are buying and it comes with rights and restrictions. The policy insures that what you bought it what you received. This assumes you read the disclosure as to restrictions on the title at the time of purchase. It guarantees that what the seller sold is something they had the right to sell.
It is a little more complex then this but that should give you the basic idea. You do not have to have title insurance for your interest if you feel the risk is something you can handle. I always get title insurance.
A lender requires such a policy so that there will not be an unexpected claim that comes in front of the lender's lien securing their loan.
The basic answer is it protects you from 'defects' with the title. The title is what you are buying and it comes with rights and restrictions. The policy insures that what you bought it what you received. This assumes you read the disclosure as to restrictions on the title at the time of purchase. It guarantees that what the seller sold is something they had the right to sell.
It is a little more complex then this but that should give you the basic idea. You do not have to have title insurance for your interest if you feel the risk is something you can handle. I always get title insurance.
A lender requires such a policy so that there will not be an unexpected claim that comes in front of the lender's lien securing their loan.
John
[addsig]