Yes or no to title insurance
Question 1: do I have to buy title insurance.
Answer: No, unless your lender (bank, mortgage company) has it as a condition of their loan to you, which most do. If you're not beholden to a lender then it is absolutely a choice for you.
Question 2: What does title insurance do?
Answer: Big topic, but in summary, it insures you, your lender and your lawyer against defects of various types that you might discover after buying the property - defects that would have come to light had the lender, the lawyer and you done a full-blown due diligence investigation on the property before you bought it. What types of defects? Mostly issues related to the title of your property, but also other things like outstanding building permit violations, structures on your property encroaching on neighbouring properties to name a couple. Basically, title insurance allows all major parties involved in a real estate deal to proceed with the deal quickly and inexpensively by assuming the risk for certain types of issues that might exist and would have been discovered in a slower and more thorough investigation prior to the sale.
Question 3: Do you need it?
Answer: considering the value of the asset you are buying, a few hundred dollars is a small price to pay for a good insurance product. Although it's (statistically) unlikely that you'll ever have to make a claim, the cost of dealing with the issues yourself that TI covers is pretty high, so in our opinion it's a good idea and we recommend it.