CostTitle insurance protects against fraud, undisclosed liens, and certain survey or zoning defects that a standard title search might miss. Lenders almost always require it, and buyers usually purchase owner coverage too, since the one-time premium is small relative to the risk it covers.
What it actually covers
Title insurance protects against financial loss from problems with the property's title that existed before you bought it but weren't caught during the standard due-diligence process — things like title fraud (someone forging documents to claim ownership or take out a mortgage against your property), an undisclosed lien from a previous owner, boundary or survey disputes, or zoning violations by a previous owner that weren't properly permitted. It's a one-time premium paid at closing, not an ongoing cost like home insurance.
Lender policies vs. owner policies
Almost every mortgage lender in Canada requires a lender's title insurance policy as a condition of financing, protecting their interest in the property up to the mortgage amount. Buyers typically also purchase a separate owner's policy at the same time, covering their own equity in the home — the lender's policy alone doesn't protect you personally if a title problem surfaces later. Since both are usually arranged together through the same lawyer, the combined cost is modest relative to buying only one.
What it costs
Typical premium, $600,000 home
| Lender's policy | ~$150–$250 |
| Owner's policy | ~$150–$300 |
| Combined, one-time | ~$300–$550 |
This is a small fraction of your total closing costs, but worth including in your budget rather than discovering it as a surprise line item on your lawyer's statement of adjustments. See it alongside every other cost on the closing cost calculator.