Why Does Everyone Quote the Same Premiums
In Pennsylvania, title insurance is highly regulated by the state’s Department of Insurance. One of the aspects that they control is the title insurance premium. The title underwriters (the big guys who pay out the money when there is an insurance claim) will file a schedule of premiums with the state. Most of them cooperate with each other and file one schedule for the lot of them. The Department of Insurance then approves the premiums. This results in the majority of title companies having uniform policy rates.
Getting a Discount on Title
CLT has a lowest premium guarantee. Most title companies do not. Most title companies will charge the highest premium possible.
Title companies use the same state regulated rate table, so how can one company charge more than another?
While the state has regulated the insurance premium amounts, they have also provided for certain circumstances that would warrant a discounted premium. Standard premiums are called the Basic Rate. This is the rate you’ll get from most companies. However, discounts ranging from 10-30% off are available for recently insured properties that meet the state requirements.
While many title companies will balk if you try to get one of these discounts, CLT actually goes out of their way to help you qualify for the lowest premium possible.
Getting the Best Price on Title Insurance for your Clients
If you have ever shopped around for a quote on title insurance, you may have noticed that everyone told you the same price. Not to worry, you were not hallucinating. Title Insurance premiums are regulated by each state. Prices are based upon the loan amount or sale price of the property.
While the state has regulated the insurance premium amounts, most states have also provided for certain circumstances that would warrant a discounted premium. The amount of the discount and how you qualify also varies by state but generally involve the number of years since the property was last insured. The amount of the discount can range from as little as 10% off to as much as 40% or more.
Some title companies have been known to balk if you try to get one of these discounts, so it is important to be well informed and prepared to stand your ground. The first step in ensuring your clients get the best price is knowledge. Call a few local title companies or the state Insurance Bureau to get a thorough understanding of the discounts available and how to qualify.
The second step to ensuring the best price is to make sure you get a full quote. Aside from the premium, most title companies have other charges and pass through costs that will appear on the HUD-1. This is where costs can vary from one company to another by as much as a several hundred dollars. While title premiums are not negotiable, other closings costs can be. If you are willing to form a long standing referral relationship with a title company, they may be willing to provide some ongoing discounts for your clients.
When discussing pricing with a title company, always do so in a non-confrontational manner. Keep in mind that everyone involved have families to feed and bills to pay. Behind the scenes, title insurance is a labor intensive and thankless job. Approach them with consideration and respect and you can expect to get the same for your client in return.
Credits:
Cheryl Hartzman
CLT
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