Which type of insurance protects a homeowner from rights affected by past ownership of the property?

Owner's Title Insurance is specifically designed to protect homeowners from potential claims or issues arising from past ownership of the property. When a person purchases a property, there may be hidden defects in the title that were not discovered during the closing or that existed before they took ownership. These defects could include things like liens, encumbrances, or disputes over ownership rights that may arise from previous owners.

By obtaining Owner's Title Insurance, the homeowner essentially secures financial protection against these risks. If a claim is made against the title after the purchase, the insurance can cover legal fees and any expenses incurred to resolve the issue, as well as provide compensation up to the policy limit.

Homeowner's Insurance, on the other hand, protects against damages to the property itself, such as fire or theft, but does not cover title issues. Lender's Title Insurance primarily benefits the lender by protecting their investment in the property, while Mortgage Insurance typically protects against the risk of default on a home loan, rather than issues with the title itself. Thus, Owner's Title Insurance stands out as the correct choice for safeguarding a homeowner against past ownership complications.