Auto Bill of Sale

I live in NY. We are selling our car privately. We are going to pay off the balance due on our loan and obtain a "Lien Release". I have prepared a standard " bill of sale" This contract states:

"The Seller warrants that the Vehicle is being transferred free and clear of any liens and encumbrances."

The buyer wants me to add the following to this paragraph:

The Seller warrants that the Seller's title to the goods is clear and merchantable. The Seller shall defend the Buyer from any adverse claims to Seller's title to the goods sold."

What does this mean? Should I include it?

"What does this mean?"
The requested inclusion simply means that in addition to your claim that the vehicle is free and clear, that you will pay any costs or damages that the buyer incurs if someone comes forth and makes a claim of ownership of or lien on of the vehicle. Vehicle liens can arise from several sources that are not noted on the title; for example: mechanics lien or even a judgment lien on a vehicle would not show up on the title itself.

"Should I include it?"
If you are comfortable in the vehicle not having any other liens or encumberances, there is no reason to not accept the inclusion. However, if there were a possibility for other claims, you should clear them first.