I do understand that the refinance rate and re-issue rate do not always make sense from the agent's perspective. The premium is a large part of the agent's revenue and there is no less work involved in insuring one of those than a refinance that doesn't qualify for the reduced rate. Really... why should agent "A" give a discount just because Agent "B" already issued a policy?
The only thing that might be considered easier on a refinance is the title search, since most refinances are issued on short searches. That being the case, there should be a discount on the exam fee. In states that wrap the exam fee into the premium, the refinance rate makes more sense.
To some extent, it makes sense to charge the consumer less from a risk assessment - the title has already been insured once so there is less risk of a claim - at least theoretically. However, as the industry is so keen on pointing out, the value of title insurance is the process in checking to make sure everything is clear - not so much assuming the risk of claims.
I guess, both sides could make a valid argument. We just do what we are told and follow the rate manual.
Best,
Robert A. Franco
SOURCE OF TITLE
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