Title insurance is different from other forms of insurance because it insures against events that occurred before the plan is issued. This is different from other forms of insurance such as health insurance, liability insurance, or life insurance which protects against events which may happen in the future.
Title insurance protects the interests of the property owner against legitimate or false title claims by previous owners or lien holders.
Title problems are discovered in more than one-third of residential real estate transaction, and these defects must be resolved before closing. The most common defects are existing liens, unpaid mortgages, recording errors of names, addresses or legal descriptions.
Thus, title insurance goes a long way toward protecting your investment.
For more information, you may want to review the materials at the California Land Title Association website (www.clta.org). This is a non-profit trade organization representing the entire title industry.