The Ramblings of a Title Man

Representing multiple underwriting companies – Good business or not?

Back in November 2011, in one of my very early Ramblings of a Title Man, I described a changing title insurance market that was pushing out smaller underwriters and consolidating the market in fewer choices for agents. In 2011, closures of New Jersey Title Insurance Company and Southern Land Title Company had forced many title agents to seek new underwriter partners. Market consolidation, including the LandAmerica–Fidelity merger in 2008 had resulted in fewer choices overall, with many states having only 7 or 8 companies that were independent from one another.?

Fast-forward 12 years and the same phenomenon is happening again. The American Land Title Association (ALTA) financial data file titled, “2022-market-share-family-company-summary” lists the overall title insurance market in 2022 at $21.98 billion dollars with 6 insurance groups plus 22 independent companies. This totaled 28 separate title insurance companies or groups with the top 4 groups maintaining an 82% market share in the United States. According to ALTA data, the top 6 groups plus the top 4 independent companies controlled 96% of the market share. After the top 10 companies, just 18 regional or single state title underwriters are left with just a 4% share of the overall market.?

In July of this year, Bermuda-based Essent Group Ltd., through its subsidiary Essent U.S. Holdings Inc., completed its acquisition of Agents National Title Holding Co. (owner of regional underwriter Agent's National Title Insurance Company) and Boston National Holdings LLC for $100 million from Incenter LLC. In November, Fidelity National Financial (NYSE: FNF) experienced a cyber incident that took down their systems and prevented agents from accessing vital company resources for two week

Title agents may again find a landscape where they are working with just one underwriter by choice or by forces out of their control. Working with just a single underwriter can prove to be a higher risk than if your company has two or more company appointments. Take the instance I described in the 2011 article. Back in 2004, the warehouse lender ABN Amro had a very large claim with one of the LandAmerica companies. To put pressure on LandAmerica to pay the claim, ABN Amro issued an order that they would not accept any policy nationwide from LandAmerica. This made every mortgage lender across the United States having to seek new title agents to close their mortgages if they were only representing a LandAmerica company. I was a title agent in 2004, and this affected me as well. I had a very large lender customer that required me to switch the underwriter we used to one of the other companies I represented.?

Back then, I had the fortune of having two appointments, a second underwriter that was unrelated to the LandAmerica group. However, we had several agents in my community that did not have a second underwriter, and they faced loss of business because of this dispute they had no control over.?

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Good business or not so good business?

I am a rep for a title underwriter. I love my agents who represent my company exclusively. But I am very honest with them that with a consolidated market and forces that can affect your ability to do business, every title agent who is past their 2-year start-up period should have two underwriters. If you do not have two, you risk everything from cyber incident interruptions, to claim disputes with lenders to merger/acquisition danger of eliminating your underwriter from doing business in your state.?

We have back-ups for our computer systems. We have emergency response plans in case of severe weather or other disaster incidents. We have cross training for our employees in case someone has an emergency and they are out for an extended time. But as an agent, do you have a back-up plan if your company only represents one underwriter and that company is unable to perform? The only answer is to have two underwriter appointments: It is just good business.