What is the primary purpose of title insurance?

The primary purpose of title insurance is to protect against losses arising from defects in the title to real property. Title insurance serves as a safeguard for property buyers and lenders, ensuring that their investment is protected from claims or issues that may arise after the purchase, such as liens, forgery, or undisclosed heirs.

When purchasing a property, a buyer wants the assurance that they are acquiring clear ownership and that no unresolved issues from the past could jeopardize their investment. Title insurance is designed to cover financial losses that may result from these defects, offering peace of mind to parties involved in a real estate transaction.

While facilitating property sales, serving as a warranty for property value, and providing legal representation in disputes may be functions associated with real estate transactions, they are not the primary focus of title insurance. Instead, the core function lies in the protection against title-related risks, making it an essential aspect of any property purchase.