What does title insurance primarily protect against?

Title insurance primarily protects against forged signatures. This type of coverage is essential because it ensures that the ownership of the property being purchased is legitimate and free from any defects that could challenge the buyer's ownership rights. If a forged signature appears on any documents related to the property's ownership—such as a deed or mortgage—title insurance can provide financial protection against losses incurred due to such fraudulent claims.

For instance, if someone forges a signature to convey property, the rightful owner may assert their claim, and without title insurance, the buyer could face significant legal and financial challenges to retain their property. Title insurance helps mitigate these risks, allowing buyers and lenders to proceed with greater confidence in their investment.

Other options, while related to property transactions, do not fall under the primary protections offered by title insurance. Property taxes pertain more to governmental claims rather than ownership disputes. Unrecorded documents deal with issues of priority and public notice but are not the main focus of title insurance, which is centered on legitimacy and ownership verification. Possession disputes exist when two or more parties claim rights to occupy or use a property but are also outside the scope specifically covered by title insurance policies.