Insuring against title defects?

[Joe Strickley]

With all the recent hullabaloo over robo-signers and clear title, I was wondering if any investors have experiences they wish to share. Apparently, REO sales have dropped by over 20% as a result of buyer apprehension. Anyone buying trustee sales may not even be able to get insurance. My understanding is that title insurers will only offer cover if the bank (owner) offers an indemnity, to cover legal costs in the event of a dispute. But what does title insurance cover you for anyway? For investors buying across State lines, are there any precautionary steps to protect from disputes over title?