Message from the CEO | Merger Mania Consequences

What are the consequences of another consolidation of national underwriters?  When will the mergers be done?  Who is next?  Independent agents and independent underwriters are the lifeblood of a diversified title industry.  Currently, the “big four” national underwriters control almost 85 percent of the overall market, while the rest of the industry completes for the remaining 15 percent.  The good news is that their market share is slowly shrinking.  But shrinking too slowly.  As a comparison, when First National Title Insurance Company (FNTI) entered the market in 2012, the big four controlled 88.2 percent of the market and 32 independent underwriters were vying for the remaining 11.8 percent.  When the Fidelity National Title/Stewart Title merger happens, the Fidelity family will control almost 44 percent of the market.  I am confident that at most, that market share will last only a few years, and that the independent agents and their underwriters will re-balance and re-gain the share “purchased” by Fidelity. 

The merger of Fidelity/Stewart has been challenged by the New York Department of Insurance for a good reason—lack of competition and market-share domination.  That rings true for the other 49 states too.  And now, finally, some of the other state commissioners are speaking out. 

It makes me wonder why it is that the independent agents continue to support their biggest competitors.  I understand that the national underwriters have referral business and some perks that the regionals can’t offer, but when looking at how much business the national’s control, why help them grow their influence? 

FNTI has been successful entering the market and building a network of solid, supportive agents.  And we have the resources to compete with the nationals.  Large commercial transactions have always been the domain of Fidelity National, Chicago Title, and First American.  We now have a reinsurance treaty in place to allow you to compete with the nationals and write an FNTI policy up to $100 million.  Why give your biggest competitor your biggest transactions?   FNTI can handle your complex, high-liability transactions.  We are in the process of getting our reinsurance program approved by Fannie Mae, which effectively eliminates any lender’s objection to our paper.   

Let’s join together and make a difference in our local markets.  Let’s show the national underwriters that the entrepreneurial spirit will out-complete them on service, personal relationships, and dedication to the customer/client connection.

Our company motto that we “…do business with those we know, like, and trust” still rings true.  It is a motto we live by.  We want you to know us, like us, and especially trust us.  We are all looking forward to another busy and prosperous year.  Let us help you compete and win in this changing market.