New York Cuts Title Rates 15%

As part of a settlement with the New York Attorney General's Office two major title insurance companies have applied for and received approval to reduce their rates by 15 percent, and four other title insurers have followed suit, officials said.

The New York State Insurance Department said the six firms, which Insurance Superintendent Howard Mills approved reductions for, cumulatively have 93 percent of the state's market share.

"New Yorkers have been paying too much for title insurance for too long because internal industry practices, rather than market forces, were driving the product's price," Mr. Mills said in a statement.

New York Attorney General Eliot Spitzer said he would continue to investigate title insurance and try to eliminate illegal practices that were inflating rates.

Mr. Spitzer announced May 23 he had settled a two-year probe of illegal payments by Fidelity National Title Group Inc. and First American Corp to agents and favored customers. Both companies agreed to pay fines, change practices and reduce rates.

Fidelity National and First American agreed to lower their rates by 15 percent immediately.

The other title insurers who have dropped rates are LandAmerica, Financial Group Inc., Stewart Title Companies and Washington Title Insurance Co.

Both Fidelity National and First American had been required by the settlement to reduce their rates by at least 15 percent going forward for properties they insure that are valued at no more than $1 million.

The new rates take effect immediately. Title insurers in New York collected an estimated $1.2 billion in written premiums in 2005, the insurance department said.

According to New York investigators, in exchange for funneling their New York customers to Fidelity National Financial Group or First American Title Group companies, real estate developers would have their title insurance fees waived or discounted in other states.