Lenders require you to purchase a lender’s policy. This kind of policy only ensures that the financial institution has a valid, enforceable lien on the property. It protects the lending institution against losses occurring from defects in titles.
An owner’s title insurance policy protects the owner from title defects that existed before the issue date of your policy. In some cases, it also covers the full cost of any legal defense of your title, for any covered matter.