An Express Article from the California Land Title Association
Bulletin 06/07-102 - February 21, 2007
California Land Title Association (CLTA) Executive Vice President Craig Page today released the following statement upon notification that the Office of Administrative Law rejected rate setting regulations submitted by the California Department of Insurance:
“CLTA applauds the Office of Administrative Law for rejecting the seriously flawed regulations proposed by the California Department of Insurance. We feel entirely vindicated in our belief that the regulations exceeded the Department’s statutory authority under the Insurance Code by illegally impairing competitive rate making and by replacing competition with government dictates in the title insurance marketplace.
“For the past year, the CLTA had urged the Department to withdraw its rate setting scheme because it would have devastated small title companies and destroyed competition. The Department chose to move forward despite expert analysis and hundreds of public comments establishing the price competitiveness of the title insurance marketplace.
“By law, the Department may only challenge rates through an impartial hearing process. Furthermore, the Department may only reverse a filed rate under two concurrent conditions: If the rate is unreasonably high for the service provided and if a reasonable degree of competition does not exist. Neither of these conditions exists in California.
“There are nearly one hundred title companies licensed by the Department, and consumers benefit from the fierce competition that exists in this industry. According to a national study by Bankrate.com, title insurance costs in California are lower than the national average and significantly lower than in other major states. Moreover, title companies have filed dozens of rate reductions during the past several years that have helped consumers save even more money when refinancing and taking out home equity loans. Consumers can price shop for title insurance and we encourage them to do so.
“CLTA is committed to working cooperatively with Commissioner Poizner on title insurance and escrow issues that help consumers without stifling competition.”