Who needs title insurance? Anyone who owns a house! Title insurance is a policy of insurance that provides coverage for the title-related risks associated with real estate transactions. It is designed to cover the unpredictable or undetectable issues such as forgery, fraud, missing heirs, etc. that can affect rights of ownership. Because it is insurance, a title insurance policy moves the risk associated with title from the homebuyer, the lending institution or the lawyer, to the title insurer. If there is a problem with title that only becomes known after closing, the title insurer may rectify the problem or compensate the title insurance policyholder, provided the type of problem that surfaces is covered by the title insurance policy.