Why is the Certificate of Title considered less protective than title insurance?

The Certificate of Title is considered less protective than title insurance primarily because it does not guarantee future ownership rights. A Certificate of Title only reflects the current state of ownership and the condition of the title at the time of its issuance. This means that it does not provide safeguards against future claims or issues that may arise after the title has been issued, such as undiscovered liens, claims from previous owners, or defects that may not have been apparent at the time of the title search.

In contrast, title insurance offers protection against these potential future claims, ensuring that if any issues arise after the property purchase, the title insurance will cover legal costs and potentially compensate for any losses incurred. This inherent lack of future protection in a Certificate of Title is a fundamental reason why it is viewed as less comprehensive than title insurance.