Title insurance is an insured statement of your ownership rights or 'title' to a property. Just because a deed has been executed and the transfer has been recorded in the court house records, it does not necessarily cancel certain prior 'rights' or 'claims' that other people might have in your property. Some of these 'claims' can go back in time months or years to prior owners of your newly acquired property.
An owners insurance policy guarantees that the property you are purchasing is free and clear of hidden defects in the title, such as undisclosed liens, confusion in ownership and other clouds on the title. Without it, you may not be fully protected against these potential claims that could cause you to lose your property and the money you invested in it.