Before you can understand title insurance, you need to understand what a title is. Title is a term that includes all of your legal rights to own, use and sell a piece of land. The title reflects all previous ownerships and transfers, including rights previously granted by other parties, such as mortgages and easements. So what is title insurance? It is insurance against undisclosed problems with the title, and it protects you against financial loss due to title defects, liens or other matters of public record. Title insurance will defend you against a lawsuit attacking your title or reimburse you for the actual money lost.

If there is a problem with the title, the ownership of your land could be in question. Unpaid taxes, a lien (which is an unpaid claim) filed by someone who worked on the house or countless other situations could cause a major problem... such as being responsible to pay a mortgage on the property you don't legally own! That's why it's important to have title insurance.

Before a policy is issued, a title insurance company conducts in-depth research to detect, prevent and eliminate risks and losses caused by title problems. They do this by searching public records to develop and document the chain of title to the property and by identifying all outstanding claims.

For a one-time premium, owner's title insurance policy will remain in effect for as long as you own the property.