Title insurer premium volume flat in 1Q

Title insurance premium volume was flat on a year-over-year basis, even as mortgage origination volume — both on dollar and unit bases — increased during the period, according to the American Land Title Association.

Industry underwriters produced $3.35 billion in premiums during the first quarter, compared with $3.37 billion during the same period a year ago.

However, mortgage lenders produced 967,000 loans with an unpaid principal balance of $377 billion during the period ended March 31, compared with 895,000 units at a dollar volume of $333 billion in the first quarter last year. The gain in dollar volume was 13% and in units, 8%.

At the same time 23% of the first quarter production by dollar volume was for home purchase loans, versus 20% one year prior, which typically generate higher premiums. The White House is pushing a pilot program to waive the requirement for a lender's policy on a refinance.

The Consumer Financial Protection Bureau at the same time is considering making lenders pay the premium for their portion of the title policy.

"Results of this quarter's Market Share Analysis reflect the continuing contraction of the housing market, which is still being impacted by higher interest rates, lack of supply and existing homeowners remaining in place," said Diane Tomb, ALTA's chief executive, in a press release. 

Total operating income was down 0.8% during the first quarter versus the prior year.

But in a sign of its strong financial position, total assets were almost $11.3 billion, while the statutory surplus was at $5.1 billion and statutory reserves were $5.7 billion.

The industry paid $161.1 million in claims in the first quarter, versus $162.6 million during the same period a year ago.

Title insurers argue that most of the premiums collected are used in curative work to fix issues that exist prior to a home sale.

First American Title Insurance remained the single largest underwriter, with a share of 22.6%, down from 23% one year ago.

The No. 2 company remained Old Republic National Title Insurance, at 14.2% of market share, down from 15.5%.

However, the two units of Fidelity National Financial in positions 3 and 4 both gained share year-over-year. Fidelity National Title Insurance had a 13.9% share, while Chicago Title was at 12.8%, compared with 12.7% and 12.4%, respectively, one year ago. A third FNF subsidiary, Commonwealth Land Title, is No. 7 overall.

Stewart Title Guarantee rose to a 9.9% share from 9.6% in the comparable period.

Westcor Land Title Insurance remained the largest independent underwriter with a 3.8% market share, up from 3.6%.

The second largest independent was Title Resources Guaranty at 2.8%; its parent company is in the process of acquiring Doma, whose underwriting unit had a 1.9% share, ranked 10th overall.