From today’s Globe:
The reason for title insurance is that someone else may have a claim on your property, such as an unpaid contractor, an heir of the last owner, or a neighbor who thinks the fence is in the wrong place. Since a mortgage loan is secured by the property, the lender’s policy protects the lender against such claims. And the owner’s policy protects the owner.
Rates in Massachusetts are a little cheaper than the national average. The prevailing rate for a lender’s policy here is $250 for every $100,000 borrowed. Owner’s policies are more expensive, in the range of $375 per $100,000. There are discounts for buying both policies at once. On a $350,000 home, the total cost of insurance is about $1,500.
The premium is paid once, at closing.
Should you take out title insurance? Maybe.
Source: Title insurers face criticism over pricing: Do you really need an owner’s policy? – By Binyamin Appelbaum, The Boston Globe