It protects your ownership right to your home both from fraudulent claims
against your ownership and from mistakes made in earlier sales, such
as mistake in the spelling of a person’s name or an inaccurate description
of the property.
It’s a one-time cost usually based on the price of the property.
In Santa Cruz, the cost is usually split 50/50 by the seller and buyer.
There are both lender title policies, which protect the lender, and owner
title policies, which protect you. The lender will probably require
a lender policy.
Discounts on premiums are sometimes available if the home has been bought
within only a few years since not as much work is required to check
the title. Ask the title company if this discount is available.