If there is a mortgage, the lender is already forcing the question — a lender's policy is mandatory in practice, and adding an owner's policy for the buyer at the same time is close to reflexive. Without a mortgage, it is still strongly advisable, not optional.
Short answer
Buying with a mortgage makes the decision almost automatic: “your lender will require a lender’s policy. Add an owner’s policy for yourself at the same time → usually a clear yes.” Buying with cash removes the lender's requirement but not the risk — an owner's policy is still "strongly recommended" against fraud and undisclosed liens.
The decision splits cleanly by scenario. On a mortgaged purchase, the lender's policy is happening regardless, so adding an owner’s policy at the same time → “usually a clear yes.” On a cash purchase, there is no lender forcing the question, but an owner's policy is still "strongly recommended," since it protects the buyer against fraud and liens with no lender involved to catch them. On a refinance, it is worth adding "if you lack one, as it's recommended while your file is already open." And for an existing owner with no policy at all, growing title-fraud risk makes a standalone policy "worth considering," particularly where there is significant equity in the property.
An owner's policy “protects you in the amount of the purchase price, and it lasts as long as you or your estate hold an interest in the property.” It covers "defects in title, undischarged mortgages and liens, unregistered easements and rights of way, encroachments in either direction, lack of legal access to a public road, municipal work orders and open permits outstanding at closing, realty tax and utility arrears from before your ownership, and existing structures that breach the zoning by-law" — plus title fraud discovered after closing. A lender's policy, by contrast, protects only the lender up to the loan amount and "ends when the mortgage is discharged." Neither policy touches "the condition of the building," most environmental contamination, or anything that happens after closing — a rezoning, an expropriation, a new work order.
Insurance is not a substitute for the search the lawyer would do anyway. As the same source puts it, "making a seller fix a problem before closing is cheaper than claiming on a policy after." No single figure applies to the premium — the decision guide gives none and simply flags it as "a one-time premium" that is "often modest relative to the protection it provided," advising buyers to "confirm the actual figure; premiums vary by insurer and property value" rather than quoting a rule of thumb to a client.
See also: title insurance, defined, survey versus title insurance and whether a deal can close with an open permit.
Walk through the mortgaged-vs-cash decision before the offer goes firm.
