New York Insurance Superintendent Howard Mills said thereappears to be growing consensus that the state legislature shouldlicense title insurance agents, a move he feels the industry nowbacks.

Mr. Mills, in addition to discussing title insurance in aninterview with National Underwriter, said that with a new governortaking office on Jan. 1, he will be resigning his post inDecember.

On Nov. 3, when his department held hearings to get informationabout title insurance programs, "we did not put them on trial," hesaid.

Title insurers have been under increasing scrutiny sinceinvestigations in several states have uncovered what officials saidwere entrenched systems where title companies used illegalincentives and inducements to steer business their way.

"One of the most interesting things to come out of it was thatthere were a lot of industry folks who feel we really do need tolook at licensing of title agents," said Mr. Mills.

He said bills were introduced in the past to license titleagents, but they were defeated by the industry. Since it came tolight that title companies were involved in alleged kickbackschemes, the industry is now seeking remedies to improvetransparency.

"Many of the professionals out there who are concerned aboutdisreputable actors in the industry see licensing as good qualitycontrol," said Mr. Mills. "They understand that they run a qualityoperation and they are not afraid of the transparencyrequirements."

Mr. Mills said the hearing obtained a lot of information aboutthe pricing and content of title insurance and what consumers getfor it. He said it was helpful information that, going forward,will help the department protect consumers.

One thing to come out of the hearing was that the product is inneed of greater transparency for the buyers.

"The typical buyer of title insurance does not understand whatthey are buying," said Mr. Mills.

Underscoring this was one thing he found disturbing: thegratuities title agents receive at a home closing. He said therewas testimony that agents receive as much as $250 because it istradition to do so.

Mr. Mills was appointed by Republican Gov. George Pataki, wholeaves office at year's end to be replaced by Democrat EliotSpitzer, currently New York attorney general.

The superintendent said while there is only about amonth-and-a-half left to his term, he will continue to work toreform the title insurance industry. Mr. Mills said the departmentis working on creating a unit that will concentrate oninvestigating title insurance abuses.

Mr. Mills said Mr. Spitzer's office had a representative at thetitle hearing, and he is confident the incoming administration willcontinue the work of the reform initiated on his watch. He addedthat the insurance department and the attorney general's officehave worked closely on this issue.

The attorney general's office, in written testimony submitted byAssistant Attorney General Hannah K. Flamenbaum, outlined allegedabuses uncovered in its investigation of the industry.

Ms. Flamenbaum said the investigation of the title industrycontinues. She requested that no findings be issued by theinsurance department until the attorney general's office hascompleted its investigations.

She noted that despite a 15 percent decrease in premium amongthe state's top title insurers, New York homeowners still pay thehighest premiums in the country.

Ms. Flamenbaum said that the Title Insurance Rate ServiceAssociation, which submits rating information to the insurancedepartment, is controlled by the carriers--an apparent conflict ofinterest--and has never applied for a decrease, despite companyprofitability.

For his part, Mr. Mills said that as he leaves office he willassist the incoming commissioner in the transition.

"I've always looked at this as a two year stint," said Mr.Mills. "I always expected that the next governor would want to namehis own cabinet, so I plan on leaving the department in December topursue opportunities in the private sector."

As far as any additional actions to be taken against titleinsurers, he said there was nothing that he could discuss at thistime.