What does title insurance protect against?

Title insurance primarily protects against losses incurred due to defects in the title of the property. This can include issues such as liens, claims, or encumbrances that were not discovered during the title search process. For instance, if a previous owner had outstanding debts that were not resolved, creditors could potentially claim the property. Title insurance ensures that the property owner is financially protected against these risks, covering legal fees or any claims against the title.

While zoning changes, property taxes, and natural disasters can certainly affect property ownership, title insurance specifically focuses on the legal ownership and status of the title itself. Thus, it does not provide coverage for changes in zoning laws, issues associated with property tax assessments, or damages resulting from environmental events. Therefore, understanding the scope of title insurance is crucial for property owners and buyers as it provides a layer of security specifically related to ownership rights.