Which of the following best describes title insurance?

Title insurance primarily serves to protect property owners and lenders from potential defects or issues related to property titles. This means that if there are any undisclosed claims, liens, or other encumbrances that affect the ownership of the property, the title insurance policy will cover these risks. This protection is crucial because title problems can lead to financial loss or even litigation, making it essential to secure a reliable title insurance policy when purchasing real estate. The correct answer encapsulates this protection function accurately, reinforcing the importance of title insurance in real estate transactions.

The other options refer to aspects unrelated to the core function of title insurance. For instance, covering property taxes focuses on a different financial concern altogether, while guarantees of investment returns or maintenance costs are not relevant to title insurance, which specifically addresses potential legal disputes regarding property ownership.