Which insurance type provides protection for homeowners against claims from construction liens or unreleased mortgages?

Title insurance is specifically designed to protect homeowners against financial loss stemming from defects in the title to their property. This includes issues such as construction liens or unreleased mortgages that may not have been identified during the title search process before closing. When a homeowner purchases a property, title insurance ensures that if a claim arises regarding ownership, or if there are outstanding liens against the property that were not properly addressed, the title insurance company will cover the costs associated with resolving those issues.

Homeowner's insurance primarily covers damages to the property itself and personal liability for accidents occurring on the premises, but it does not address issues related to the title of the property. Liability insurance is focused on protecting the homeowner from lawsuits or claims for injury to others on their property but similarly does not cover title issues. Property insurance generally refers to coverage for physical damage to the property and does not encompass the legal aspects of ownership that title insurance handles. Thus, title insurance is the appropriate choice for safeguarding against claims related to construction liens or unreleased mortgages.