What does title insurance provide evidence of?

Title insurance provides evidence of marketable title, which refers to a title that is free from significant defects and issues that could impede the property's transfer or affect the owner's use of the property. When a property has marketable title, it indicates that there are no legal clouds or challenges that could interfere with the buyer's ownership rights.

Title insurance protects against potential future claims or defects that may not be discovered during the initial title search. This includes issues like undisclosed heirs, prior liens, or errors in public records. The coverage ensures that if any challenges to title arise after the purchase, the title insurance company will cover the associated legal costs and losses.

Proof of ownership is established through the deed recorded with the appropriate governmental authority, while clear title signifies there are no encumbrances or defects preventing the transfer of ownership. Property value is determined based on various factors, including market conditions and property characteristics, and is not directly related to title insurance. In essence, title insurance focuses on the marketability of the title rather than these other elements.