In the event the title to your home is challenged in a court, the title company will provide legal counsel and pay the legal costs involved in defending your position and resolving the dispute, up to the extent of coverage outlined in the policy. If an adversary's claim of ownership is determined to be valid, the title company will reimburse you for any covered financial losses, again, up to the policy's limits.In some states, homebuyer's title insurance is not required. However, it is almost always recommended to protect against potential title defects.