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Source of Title Blog

I Like Mike
by Robert Franco | 2008/06/11 |

I like Mike.  Mike sells title insurance and he is proud of it.  With the vast amount of negative press the title industry has seen in past few years, that isn't always something that is easy to admit.  Whenever someone asks what I do for a living, I look around to make sure it's safe before I announce that I am a title insurance agent.  Then... I prepare to duck for cover.  People didn't used to know what that was.  Now, thanks to the media, they "know" that the title industry is full of crooks!  But, Mike has the right perspective and as the president elect of ALTA maybe he will be able to effectuate positive change.

Source of Title Blog ::

Meet Mike Pryor, president and CEO of Lenders Title Company in Little Rock Arkansas and president elect of ALTA.

"I provide a thorough and accurate search of the title, resolve ownership issues, provide lien records, keep the courthouse records accurate, collect unpaid child support, facilitate collection of government taxes and assessments, and require proper conveyances and acknowledgments.  Its my work that keeps the housing market and the overall economy from being bogged down by inaccuracy, uncertainty and fraud. "

...

"Our industry is constantly being criticized for our low claims payout, but I salute every title insurance agent that has made that happen. It's our good work that keeps our customers, our friends and our neighbors from experiencing claims.  We have done our jobs."

Mike recognizes that our industry has those whose bad practices should be eliminated. And, he knows the importance of the process.  He seems to realize that only a "thorough and accurate" search of the title can protect our friends and neighbors from unnecessary title claims.  That is great - ALTA needs someone who understands all of these things about our industry.

It is my understanding that ALTA rotates the president's position each year between an underwriter representative and an independent agent.  The current ALTA president, Gary Kermott, is a First American executive.  I'm not so sure he understands the importance of a reliable title search.  After all, First American is the "innovator" that has brought our industry the "one-minute title search" and the "thin title plants" created by cheap labor in India.  Anyone who has ever been forced to endure customer service or tech support calls to India has experienced the problems that the language barrier creates.  Yet, those are the people indexing the records many title policies rely on. 

First American was also a pioneer of the short search for title insurance purposes.  They have constantly been lowering the standards for the requirements of a title search to meet the weak abilities of their "automated" and "thin title plants."  First American doesn't understand what a "through and accurate" search is... but, I think Mike does.

Mike is entering a culture dominated by the underwriters who have been proponents of weaker title standards - weaker title standards that do not provide the same value to our friends and neighbors.  A culture that has foregone traditional title standards in favor of faster, cheaper title searches.  A culture that is seeing title insurance claims rising.  And, if I'm correct, we will see claims continue to rise as more and more policies are issued based on "instant" title searches.

It will be interesting to see how a "traditional title guy" does at the helm of ALTA.  Mike will have the opportunity to attract many of the small agents and abstractors back to ALTA if he can reach out to the disillusioned and disenfranchised who left (or never joined) because of the perception that ALTA is merely a mouthpiece of the "Big 5." But, that will be no easy task - trying to buck that trend will be akin to rolling a snowball up a mountain.

Small agents and abstractors seem to be very upset by the changes that have taken place in our industry over the past decade.  Instant title products and Affiliated Business Arrangements have been devastating to many of the small businesses in our industry.  Though there doesn't seem to be much benefit to the consumers, they have found a place among the underwriters and large agents.  The big companies are getting bigger by cutting their costs and creating captive clients, but the consumers aren't seeing any savings.  Instead, the dominance of the big companies has come at the expense of their smaller competitors as they slowly erode the options of consumers.

Changing the status quo may not be possible.  I'm not expecting any miracles.  Still, I like Mike.  It will be interesting to see what he does at the helm of ALTA. 

Robert A. Franco
SOURCE OF TITLE




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Categories: Land Title Associations

1171 words | 2185 views | 10 comments | log in or register to post a comment


FIRST AMERICAN AND THEIR QUICK SEARCHES

HELLO AGAIN ROBERT :) CHARLIE HERE, BUT ISN'T FIRST AMERICAN ALSO PAYING TONS OUT IN BAD CLAIMS FEE'S? I BELIEVE I READ THAT SOMEWHERE.

 
by charles jetter | 2008/06/12 | log in or register to post a reply

Claims are up across the board

I have heard that claims are up across the board, but I don't know for sure how much they are up for each individual underwriter.  I will have to see if I can find anything out about that.  It would be interesting to see the statistics.

 
by Robert Franco | 2008/06/12 | log in or register to post a reply

Claims stats

It would be interesting to see the claims from outsourced products also- surely the inexperienced and uneducated( by that I mean not knowing the different ways to search in each jurisdiction) title persons that are employed can't even approach the level of competence and experience that a local title examiner can provide- but that is the price they are paying for "saving" a buck to squander thousands in claims. Not to mention the loss of employment by the local title abstractor/examiner that once had a good , steady job and now is looking at some hard times as a result of that type of action- selling the jobs right down the Ghangis.

Steve Meinecke

 
by STEVE MEINECKE | 2008/06/12 | log in or register to post a reply

claims

Fidelity paid about $335 million in claims last year; First American paid $301 million in claims; LandAmerica paid $270 million; Stewart paid $117 million; and Old Republic paid $43.3 million. I don't have a breakdown in claims from outsourced products, but First American and Fidelity did retool their refi products because of significant increases in claims.

 
by Jeremy Yohe | 2008/06/12 | log in or register to post a reply

BAD CLAIMS

HEY ROBERT :) CHARLIE HERE, IT WAS IN ONE OF THE ARTICLES ON HERE LAST YEAR WHERE I READ THAT FIRST AMERICAN WAS OUTSOURCING TO INDIA BECAUSE THEY COULD GET A $10.00 TITLE ORDER DONE. BUT THEY HAD OVER A 63% BAD CLAIMS RATE

 
by charles jetter | 2008/06/13 | log in or register to post a reply

BAD CLAIMS

JUST THINK JEREMY, WE MAY GET TO REDO THOSE JOBS THAT RESULTED IN BAD CLAIMS, WHAT DO YA THINK???

 
by charles jetter | 2008/06/13 | log in or register to post a reply

Underwriter Claims

Thank you for the information Jeremy.  Those claims are spread out about as I would expect, just based on the size and market share of the underwriters.  It would be interesting to see you guys at The Title Report track the claims and see if you find a correlation between "instant" title searches and claims.  Automated title seaches are still fairly new, but becoming more common.  As we know, it sometimes takes years for claims to get reported.  I don't know if the stats exist to track such things, but it would make for some intersting articles.

Charlie, I don't recall the "63% Bad Claims" figure you mentioned.  It may have been something someone posted on the forums, but I don't recall us ever reporting such information.  I don't even think that the underwriters will break their claims down like that... at least not publicly. 

 
by Robert Franco | 2008/06/13 | log in or register to post a reply

Will ALTA lead the title underwriters and agents to a restoration of the traditional roles?

Thanks for the heads up on this video.  I've met Mike before.  I attended a "big" agent meeting in Chicago a few years ago because they intended to discuss alternative ways to market title insurance without affiliations.  I thought that was a wonderful development.  I spent a few bucks to go only to have Anne Annastasi start that conversation with a comment that you can't market title insurance without being affiliated.  I blew a gasket.  Mike was one of three people sitting at that table who I believe were traditional title people.  I am happy to see this video.  I am happy to see him at the helm of ALTA as the title industry recovers from the "crazy koolaid" of crap standards.

I am hopeful that the underwriters have been burned severely enough to restore traditional roles.

Let's hope ALTA leads in this endeavor rather.

 
by Diane Cipa | 2008/06/13 | log in or register to post a reply

instant searches

Maybe once the underwriters start breaking down where their claims come from, such as divulging claims from instant searches or offshore searches, then we could get a peak at the potential benefits or dangers of using instant searches. But like you mentioned Robert, the udnerwriters don't do that. I'm sure they know, they just aren't going to tell. Until then, it's pretty much impossible for us at The Title Report to know what type of search was done on a transaction. It definitely would make for interesting stories ... especially comparing claims to traditional searches, instant searches and searches done overseas.

Interestingly, Fidelity said 50 percent of its claims in 2007 came from agents, while First American said 59 percent of its claims came from agents and 41 percent from direct ops.

 
by Jeremy Yohe | 2008/06/13 | log in or register to post a reply

I like Mike too!

I cannot thank you enough for the article on the ALTA President elect, Mike Prior.  I can't remember when I have felt such pride in my vocation.  What a great, well-written article!  I will follow his example, from now on, when telling people what I do for a living! 

On another note, I want to say that I have also been a title examiner, and I often do a prelim. search that I send in with my actual request for search--just to make sure I have an idea of what to expect.  This way, when my commitment comes back, I can quickly tell if they have not been thorough.  This practice, which takes all of 30 minutes or so, has often revealed things that could have become problems. 

The company I am affiliated with uses only one search company, so I am married to them, but that does not give me an excuse to fall down on my job--that of protecting my customer UP FRONT! 

I like Mike too!  And, I sure do appreciate you and all of the excellent work you do.  Thank you. 

Sincerely, Shari Lee Beynon, "LTA"

 

 
by Shari Lee Beynon | 2008/06/25 | log in or register to post a reply
Source of Title Blog

Robert A. FrancoThe focus of this blog will be on sharing my thoughts and concerns related to the small title agents and abstractors. The industry has changed dramatically over the past ten years and I believe that we are just seeing the beginning. As the evolution continues, what will become of the many small independent title professionals who have long been the cornerstone of the industry?

Robert A. Franco
SOURCE OF TITLE

 

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