A.M. BestTV: U.S. Title Sector in Flux Amid New Rules, Bumpy Housing Market

OLDWICK, N.J.--()--This third in a series of “First Monday” episodes spotlights A.M. Best Senior Economist Meg Mulry and Senior Financial Analyst Neil Das Gupta discussing the state of the U.S. housing market and how new disclosure practices will impact title insurers. Click on http://www.ambest.com/v.asp?v=fmtitle1015 to view the entire program.

The last “First Monday” episode for October will look at how Mexico’s new Solvency II- like regulations could lead insurers concentrated in certain lines of business to seek capital relief through reinsurance. “First Monday” is A.M. Best’s monthly program featuring commentary by the company's leading analysts.

The title insurance industry is in a state of flux, and the housing recovery has seen fits and starts, which has slowed overall progress.

“2014 title insurance premium volumes declined primarily due to a slowing down in refinancing transactions,” said Das Gupta. “Another reason for the slowing down was harsher winter weather over the past year, which made title orders that are tied to home sales slowdown. However, title insurance was able to maintain its operating margins, primarily as a result of more efficiency in its operations, better underwriting practices and lower loss trends.”

“The broader economy has been pretty supportive of the rebound in the housing market over the past few years,” said Mulry. “Recent second-quarter data has shown the economy growing at 3.9%, which is faster than it has in previous quarters and unemployment or the labor market continues to perform very well, with unemployment coming down to 5.1% from 5.7%. This shows that the market is making steady gains, and the consumer is in a better position with healthy balance sheets.”

A.M. Best has a stable outlook on the title industry. The industry’s financial condition is largely positive with strong balance sheet strength and a continuing favorable operating performance.

Recent episodes of A.M.BestTV include:

  • Sharing the Ride and Sharing the Risk: A.M. Best Senior Financial Analyst Michael Venezia explaining how growth in ride-sharing services, such as Uber and Lyft, has the insurance industry contemplating exposures: http://www.ambest.com/v.asp?v=uber1015.
  • Consolidation Expected With New Mexico Regulations: A.M. Best América Latina Managing Director Manuel Calderón and Director of Analytics Alfonso Novelo’s discussion on implementation of new Solvency II-like rules in Mexico and their likely impact: http://www.ambest.com/v.asp?v=mexicorules1015.
  • Crowd-Sourcing Startups Aim to Return Insurance to Its Roots: Peer-to-peer insurance startups are melding technology, social media and early insurance models to cover members: http://www.ambest.com/v.asp?v=crowdsource1015.
  • Canada Insurance Market Bucks Trends: A.M. Best’s 2015 Insurance Market Briefing – Canada, which recently took place in Toronto, had senior A.M. Best analysts expressing the view that Canada’s market continues to be one of the most stable markets worldwide: http://www.ambest.com/v.asp?v=mbc915.

A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View A.M.BestTV episodes at http://www.ambest.tv.

A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

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Contacts

A.M. Best
Lee McDonald, 908-439-2200, ext. 5561
Group Vice President, Publication and News Services
lee.mcdonald@ambest.com

Contacts

A.M. Best
Lee McDonald, 908-439-2200, ext. 5561
Group Vice President, Publication and News Services
lee.mcdonald@ambest.com