"Because any home, no matter how new or apparently secure, is built on land as old as the earth itself. Undoubtedly this land has had many previous owners. Claims against any one of these persons can be filed against the property and against you as the present owner. Such hazards as fraud, missing heirs, old liens and many others can, and often do, arise like ghosts out of the past."
"Title Insurance protects you against past claims and title faults. It makes your home safely yours. Your title insurance policy is your shield of protection and will defend your ownership against loss. You pay one premium only - your protection and peace of mind last as long as you and your heirs remain in ownership."
What would you do if a previous owner had a tax lien placed against the property? Would you be prepared to pay it? I have a friend who purchased a property. After settlement he received a phone call from his "new partner." The previous owner had not informed my friend that there was another 50% owner in the property. Luckily, he had purchased title insurance. Even though the his new partner did not show up on any of the "searches," the title company stood behind the policy. My friend was not out a dime, nor did he have to hire an attorney. And, this is just one of a thousand different scenarios. That is why almost every bank and mortgage company require it, however; did you know that their title policy doesn't necessarily cover you? The "lender's policy" covers the lender. If you do not request your own policy ... and there is a flaw in the title, are you prepared to absorb the equity in the house?