Am I obligated to buy title insurance when I buy a piece of property?


No, if you are referring to homeowner's title insurance, this is an optional coverage.

However, if you plan to take out a loan in order to finance your purchase, the bank will usually require you to buy lender's title insurance. This is one of the bank's requirements before they will approve of your mortgage loan.

That said, it is still advisable that you get title insurance that will cover your interests in the property. You may be faced not just with the loss of your title, but also with huge defense costs in the event that someone files a claim on your property, stating that they (and not you) own the property.

The title insurance will also help you clear any clouds that may come up while you are the owner of the property. This may come in the form of indemnity in case you need to tear off part of your house or an improvement in it because of a zoning violation or because it encroached upon the property of someone else.

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