What is the primary purpose of title insurance?

The primary purpose of title insurance is to indemnify against loss from defects in title. When a person purchases title insurance, they are essentially protecting themselves against any potential issues with the ownership of the property that may arise after the purchase. This includes unknown liens, claims, or other legal issues that could affect the validity of the title.

Title insurance offers financial protection to the policyholder in case a claim is made against the title, thus assuring them that if they were to incur a loss due to a title defect, the insurance would cover those losses. This aspect is essential in real estate transactions as it allows buyers to have peace of mind that their ownership rights are secure.

In contrast, other options provided do not accurately reflect the primary function of title insurance. Warranties for property defects pertain more to the assurances given by sellers and are not a core function of title insurance. Ensuring payment on mortgages relates to mortgage insurance rather than title insurance. Lastly, protection against natural disasters is covered by other types of insurance, such as homeowner's insurance, and is not the focus of title insurance.