Title premiums slipped in 2022 on lower originations

By: ameer@trustedteam.com

Title insurance premium volume slipped 16% year-over-year for 2022 as a consequence of the slowdown in mortgage originations, American Land Title Association data showed.

The industry generated approximately $21 billion in 2022, down from a record $26.2 billion in 2021. Last year mortgage originations totaled $2.25 trillion, compared with $4.44 trillion in 2021, according to the Mortgage Bankers Association. But the drop off in higher premium purchase volume was much smaller, to $1.58 trillion versus $1.86 trillion.

In the fourth quarter, title premiums written totaled $4.4 billion, down from $5.4 billion in the third quarter and $7.1 billion one year prior.

Besides lower origination volume, the title insurance industry is facing an existential threat from alternative products such as attorney opinion letters that are coming to market.

“Title professionals across the country continue to navigate their businesses through this challenging and volatile real estate cycle, dedicated to serving their customers, protecting property rights and supporting their communities despite the uncertainty of the marketplace,” said Diane Tomb, ALTA’s chief executive officer, in a press release.

The insurers also paid more claims in 2022, $596.1 million, an increase of approximately 25% from $474.4 million from 2021.

First American Title had the highest share among individual underwriters in 2022, at 22.1%, followed by Old Republic Title at 15.8% and Fidelity National Title at 13.7%.

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Fidelity’s sister company Chicago Title was fourth at 13.3%, while another affiliate, Commonwealth Land Title ranked seventh at 3.4%; taken together the three Fidelity National Financial units have a market share over 30%. The only shift in the annual rankings was between Fidelity National and Chicago Title.

The largest independent underwriter remains Westcor Land Title, ranked sixth at a 4.4% share.

Publicly traded Doma had just a 1.8% share in 2022, the ALTA data showed.

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