The decision to purchase a home (or other real property) is probably the largest and most important financial decision you will make. You and your lender will want to make sure that title to the property is indeed yours.
Title insurance guarantees against losses from any defects in title that may exist in the public records at the time you purchase that property, and certain other risks described in the title insurance policy.
Some Possible title defects include:
Errors or omissions in deeds
Mistakes in examining records
Forgery
Undisclosed heirs
Missing heirs
Liens for unpaid taxes
Liens by contractors
Title companies check for defects in your title by examining public records including:
deeds
mortgages
wills
divorce decrees
court judgments
tax records
liens
and maps.