What is the primary purpose of title insurance?

The primary purpose of title insurance is to protect against claims regarding ownership of a property. Title insurance provides coverage for the buyer or lender against defects in the title that could be uncovered after the purchase, such as liens, encumbrances, or issues resulting from prior ownership. This type of insurance ensures that the buyer has a clear and marketable title to the property, which is crucial for preventing potential disputes over ownership and ensuring the investment is secure.

Unlike other types of insurance, title insurance is a one-time premium paid at closing that protects the insured for as long as they or their heirs own the property. This focus on ownership claims distinctly separates title insurance from options that would cover physical aspects of the property, inspection damages, or warranty on repairs, which address different concerns in real estate transactions. Thus, option B accurately reflects the essential function of title insurance in the realm of property transactions.