National Title Players Have Strong Third Quarter

For the nation’s second, third and fourth largest title insurers, the third quarter was very good and profitable. First American Financial, second largest by market share of premiums written, reported net income of $103.5 million, up from $21 million one year prior, as title pretax income nearly tripled to $142 million from $53 million.

Both the A.M. Best and Demotech ratings agencies have maintained their stable outlook on the whole universe of title insurance underwriters following their respective examinations of industry data for the second quarter.

Stewart Information Services Corp., No. 3, had $34.7 million of net income, up from $4.5 million for 3Q11.

If it weren’t for the private mortgage insurance business still on its balance sheet, No. 4 Old Republic International Corp. likely would have also reported a profit at the corporate level. Pretax income for its title segment was $21.7 million, up from $9.6 million.

But the run-off Republic Mortgage Insurance Co. business had a pretax operating loss of $126 million. Excluding this and the consumer credit business which is also in run-off, ORI had net income of $71.6 million, up from $57 million in 3Q11. But the run-off businesses had a net loss of $86.4 million (an improvement over the year-prior’s $159.8 million), leading ORI to report a net loss of $14.8 million, an 87% improvement over 3Q11’s net loss of $116.5 million.

Direct open orders at FAF rose to 438,500, up from 344,500. Stewart reported open orders of 111,500, up from 101,200. ORI did not report this information.