Colorado probes real estate title insurance rates
February 25, 2005
Investigation sparked by national kickback scandal
Colorado's insurance commissioner has launched a probe into title insurance rates and their pricing, sparked by the growing national title insurance kickback scandal, the Rocky Mountain News reported Thursday.
"If (insurers) can afford to send kickbacks to reinsurers who are not providing any payouts, then maybe the prices are too high," Colorado Insurance Commissioner Doug Dean told the News.
The investigation will examine title insurers' financials, loss ratios and overhead expenses, reports said.
Last week, First American Title Insurance Co. agreed to refund about $24 million to consumers nationwide while under investigation by the Colorado Department of Insurance. This Wednesday, California's insurance commissioner announced an investigation into alleged title insurance kickback schemes in California. Florida and Washington states are also conducting investigations.
Fidelity National Financial, under investigation in California, has discontinued the reinsurance agreements that came under scrutiny.
Dean told the News he saw evidence of wrongdoing when reinsurance companies didn't pay a dime. "That is the proof, the smoking gun," he said.
Copyright 2005 Inman News