Wednesday, April 25, 2018

Palm Beach Post one-sided attack on title insurance continues

       In an article nominally addressing the possible merger of two large title companies (https://tinyurl.com/yd5p3ew7 April 14, 2018) the post took the opportunity to again lambaste the cost of title insurance.  here is my letter to the editor which the Post has so far refused to run:


Dear Editor:

          I read with dismay Craig Elmore’s piece in April 14, 2018 Post about the merger between Fidelity National Financial and Stewart Title.  Instead of addressing the issues that the merger may cause, the main thrust of the article is to lambast the cost of title insurance in a one-sided rant replete with mistakes and misstatements.

          First Elmore claims it is, “It’s a kind of insurance designed to defend and compensate buyers and lenders in case of challenges to the title ownership, involving records that show who has rightful legal claim to the property.”  That is only one thing title insurance insures for under the policy.  It also provides coverage for unpaid liens, assessments, missed mortgages and mistakes (deeds with missing witnesses, errors in abstracting, etc.).  Also, title insurance does not simply wait for challenges but will affirmatively take action to fix issues when discovered by either filing suit or paying compensation.

          Elmore also states that shopping around is fruitless because no simple task to locate dramatic price differences, as title insurers wearing a whole raft of different brand names operate in a handful of corporate “families,” implying that underwriter’s set prices for title premiums.  This is simply false in Florida.  Prices are set by the Florida Department of Insurance, and these fixed premiums have fallen over 30% against inflation in the last 25 years.  Local title agents will compete on price and may Realtor shop closings to save their customers hundreds of dollars.

          Premiums are rising because the economy is doing better plus prices have recovered from there dramatic drops, not because the costs of coverage has increased.  In fact premiums have not increased at all since 2011 (or in fact since 1994 in Florida).

          Comparing loss ratios for title insurance to casualty insurance is also without merit.  Buy a home and pay a one-time title premium for lifetime coverage, or pay more than that per year to cover casualty insurance.  They are simply not equivalent coverages.

          The claim of the CFA about “huge kickbacks, expensive gifts, and other inducements from the insurers to real estate professionals” is simply not true for the most part.  These activities are illegal in residential real estate with federally insured loans, and has had no effect or premiums to “raise the price of title insurance to “absurdly high levels.” 

          Elmore’s last fallback is to tout Iowa’s low costs for coverage.  What he fails to state is that Iowa has a government run not-for-profit company that issues policies.  I am sure if Florida took over FP&L and ran it as a not for profit, our electric bills would be cheaper too.  What Elmore fails to mention is that if losses exceed revenue, the taxpayers of Iowa must cover the difference.  He also fails to mention that to get that cheap $110 policy, one must hire an abstracter to abstract title and an attorney to issue a title opinion.  Abstracts in Iowa costs about $350 and up, (versus $75-125 in Florida) and title opinions prices vary by attorney.

          This is the second time the Post has run a one-sided article about title insurance.  This type of coverage belongs in the editorial section, not as unbiased business news reporting.

9 comments:

  1. Great Article!
    I love to read your articles because your writing style is too good,
    I hope it will be helpful for everyone.
    Home Insurance Palm Beach Gardens FL

    ReplyDelete
  2. This comment has been removed by the author.

    ReplyDelete

  3. Attention!!!

    Do you have a bad credit?
    Do you need money to pay bills?
    Do you need to start up a new business?
    Do you have unfinished project at hand due to bad financing?
    Do you need money to invest in some area of specialization which will profit you? and you don’t know what to do.

    we render all kinds of loan in good services, contact us via email: inforamzanloan@gmail.com
    Thanks
    Mr Ramzan

    ReplyDelete
  4. Great post.Thanks for sharing this wonderful information.This is a very informative blog.
    VA Mortgage Calculator

    ReplyDelete
  5. Thanks for the sharing this article. This post is really amazing and informative. I love to visit your blog. real estate attorney nj

    ReplyDelete
  6. Hello,
    This is a nice blog. I am a regular reader of your blog. Every time I get a useful information from your blog. Thanks for sharing.
    Real estate lawyer Quincy

    ReplyDelete
  7. Nice Post,
    I like to read your blog. You shared a really great information. New Jersey estate planning attorney.

    ReplyDelete
  8. Do you need 100% Loan Finance? huge capital Private finance for business expansion, new project start up. We offer our services to both government and companies in any part of the globe. Our services falls in various ranges like direct funding program, short and long term funding program, Discounting of bank Financial Instruments, Letter of Credit against acceptable bank instruments, Asset trading – Trade finance Etc.

    AHMED KUMAR.
    solutionlogicmoney@gmail.com
    Whatsapp Number: +447459797459
    Whatsapp Number: +918375004762
    LOGIC MONEY FINANCIAL COMPANY

    ReplyDelete