What is the primary purpose of title insurance?

The primary purpose of title insurance is to guarantee against defects in the title. This means that title insurance provides protection to the policyholder from any potential claims, liens, or encumbrances that might affect the ownership of the property. When purchasing real estate, a thorough title search is conducted to identify any issues, and title insurance plays a crucial role in ensuring that the buyer has clear ownership. If any problems arise after the transaction, such as undiscovered claims against the property, the title insurance policy helps cover the costs associated with resolving those issues, thus safeguarding the investment made by the buyer.

Other choices such as covering repairs on the property, providing funding for transactions, or assisting in the sale do not align with the core function of title insurance. While those aspects might be part of the broader real estate transaction process, they are not relevant to the specific role of title insurance in protecting against title defects.