TLTA Defends Texas Rate-setting Structure

February 4, 2016

Competition is “alive and well” the Texas Land Title Association said in response to a suggestion by two organizations that the state reform its rate-setting structure.

The Texas Association of Business and the Texas Public Policy Foundation believe the promulgation of rates by the state prohibits competition in the market and results in higher cost to consumers. TLTA President Patti Bonner, however, points out that a title insurance policy in Texas costs less today than it did 20 years ago.

“The title industry has seen only one price increase in the last two decades,” Bonner said. “Very few industries can make that claim about their prices. By any measure, the Texas title insurance regulatory system works well for consumers. Over the past two decades, Texas title insurance rates have decreased by approximately 15 percent, while the costs of other similar goods and services have increased. A $150,000 title policy on a home today costs $1,152, while in 1991 the same policy cost $1,347.”

The current regulatory system in Texas is managed by the Texas Department of Insurance with additional consumer protection oversight from the Office of Public Insurance Counsel (OPIC). Title insurance rates in Texas are set by the commissioner of the state’s department of insurance.

“Texas has always put a priority on protecting individual property rights,” Bonner said. “The Texas title insurance system is part of that important public policy framework. Texans can count on knowing they have access to high quality title insurance services from local companies in their communities all across the state. Most importantly, this is a system that has worked well and served Texan’s well for the better part of a century.”

TLTA also pointed out that simply comparing title insurance rates to other states does not provide a full picture of cost. In many states, while insurance premium rates may appear lower, other costs such as attorney’s fees, abstract fees and higher closing fees are not factored into the title premium as they are in Texas. Rates in Texas are all-inclusive. This means that in addition to the risk covered by the title insurance company, the rate also includes the title search and examination, and closing the title insurance transaction.

“Having a known, consistent premium rate, as we do in Texas, takes the guesswork out of this part of the real estate transaction,” Bonner said. “Title insurance shouldn’t be confused with other types of insurance like homeowners and auto insurance that insure against future hazards or other risks. Not only are title insurance premiums only paid once at closing rather than annually, title insurance also provides coverage for an entirely different type of risk.”

Contact ALTA at 202-296-3671 or