One of the benefits of doing business in Texas is that title insurance consumers are protected by the Texas Title Insurance Guaranty Association (TTIGA). Our Texas system of regulation contemplates situations where a title insurance underwriter may become insolvent. If that occurs, TTIGA steps in and has an obligation to protect the policy holders of the State of Texas.
In January, 2016, all the title insurance underwriters authorized to do business in Texas were given a rare opportunity to submit a bid to assume the liability of the “in-force Texas policies of Southern Title Insurance Company.” Southern Title Insurance Company (STIC) issued policies in Texas from July, 2004 – December, 2008 – approximately 58,739 policies. The opportunity to assume another underwriter’s policies has presented itself only one other time in my career in the industry. When Title USA became insolvent in the late 1980’s, Alamo Title Insurance Company assumed the liability for those policies. If I remember correctly, the insureds also had a right to have their Title USA policies replaced by an Alamo policy at a discounted rate. While the agreement we executed does not offer this option, the fact that the liability of the STIC policy holders has been assumed by First National Title Insurance Company (FNTI) should provide those insured with a level of comfort they did not have 9 years ago.
I am proud of our team for analyzing the data, evaluating the exposure and taking the risk to assume this additional liability – all for the benefit of the consumers of Texas.