CHICAGO--(BUSINESS WIRE)--Fitch Ratings today has released its 2015 review of the U.S. Title Insurance Industry in a special report titled 'U.S. Title Insurance Industry 2015 GAAP Financial Results'.
'The four publicly traded U.S. title insurers, which make up almost 90% of industry operating revenues increased 14% to $16.4 billion at year-end 2015,' said Gerry Glombicki, Director at Fitch Ratings and Title Insurance Sector Head.
Title revenue improvement in 2015 was due to growth in both purchase and refinance mortgage originations and increased commercial market activity. Margin expansion in 2015 was driven by better underwriting performance. The group's GAAP title combined ratio declined by 3.2 points to 92.6%, driven largely by expense ratio improvement from revenue growth.
Fitch anticipates revenues to be flat to slightly negative in 2016. Total mortgage originations are anticipated to slightly decrease in 2016 due to lower refinancing volume given the potential for measured, but gradually rising, interest rates. Both the Mortgage Bankers Association of America (MBA) and Fannie Mae forecast a 9% and 11% decrease in mortgage originations, respectively, though Fitch believes these estimates to be somewhat conservative.
Significant economic uncertainty remains around several major macroeconomic factors such as interest rates, inflation, employment, taxes, public sector debt levels, and U.S. monetary and fiscal policies. The level and path these variables take can greatly influence title insurance results for 2016.
The report 'U.S. Title Insurance Industry 2015 GAAP Financial Results' dated March 14, 2016, is available at 'www.fitchratings.com' under 'Insurance' and 'Special Reports'.
Additional information is available at 'www.fitchratings.com'.
U.S. Title Insurance Industry 2015 GAAP Financial Results (Profit Improvement Trend Likely to Flatten in 2016)