Both the A.M. Best and Demotech ratings agencies have maintained their stable outlook on title insurance underwriters following their respective examinations of industry data for the second quarter.
Best’s look at the title industry included a review of 2011 full-year data. It noted that the underwriting loss of $29 million for that year was the industry’s best performance over the prior five years. Net premiums written were down by less than 5% from 2010, while underwriting income was up 86%.
“Another potentially positive sign is that title premiums have increased 10% in 2Q12, compared with the same period in 2011. In addition, underwriting performance has significantly improved through the second quarter, as losses from prior years have begun to moderate,” Best said.
It does not expect its ratings on the title insurers to change over the near-to-medium term.
According to the American Land Title Association,
Demotech said it affirmed its financial stability ratings on the title underwriters following a review of their 2012 statutory financial information and other factors.
Douglas A. Powell, senior financial analyst at Demotech, said, "Title underwriters continue to exhibit financial stability as they have maintained adequate levels of policyholders' surplus while increasing direct premiums written period over period.
“It is also worth noting that in the second quarter, aggregate underwriting results were positive. This is the first time since 2007 the industry has reported a net underwriting gain on a year-to-date basis in consecutive quarters."
