Learn more about the title insurance industry and find out why rates are too high in Texas.
Competition Is Prohibited in Title Insurance
Texas has among the highest rates charged for title insurance in the nation.
Texas is one of only two states that fix the rates charged for title insurance.
Setting rates eliminates any opportunity for price competition or innovation.
Current law does not allow a consumer to shop around for the best rates or policy.
Insurers are prohibited from offering lower rates or discounts.
On a per-policy basis, price fixing adds from $292 to $1,663 in costs for the average purchaser of title insurance policies of $1 million dollars or less.
The added costs are even greater for larger and commercial policies.
Setting rates forces expenses to be set high to account for inefficient insurers.
The absence of competition makes the purchase of property more expensive.
Consumers Are Denied Full Participation in Rate-Setting
Title insurance is the only line of insurance where the state sets a single rate and citizens cannot fully participate in the rate-setting process.
This single rate is set in a hearing held by the Texas Department of Insurance every five years, unless set more frequently by the Insurance Commissioner or requested by the title insurance industry.
Consumers do not have a way to effectively participate in the rate-setting process.
Not only are consumers excluded from effectively participating in hearings, but they cannot request a hearing.
Only title insurance companies, agents, associations, and government regulators have input in the rate-setting hearings.
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