News: 2007 Press Release

SACRAMENTO - Insurance Commissioner Steve Poizner today said he welcomes a U.S. Government Accountability Office (GAO) report that calls for improved oversight and better consumer protection across the title insurance industry. The report, released earlier this week to the House of Representatives Committee on Financial Services, cites the California Department of Insurances leadership role in enforcing laws to prohibit unlawful payments by title companies and to protect consumers.

"The GAO report is a terrific affirmation of both our position on the need for greater transparency and the regulations we have proposed to bring healthy competition to the title industry," said Poizner. "In fact, the report specifically points to California's proposed title regulations as an important tool in making certain title insurance rates are not excessive."

The report mirrors CDI's own research which indicates there is not adequate price competition in the title industry. The GAO also concluded that consumers play a very limited role in selection of a title insurer or agent, and that there are a number of reasons to believe that prices may be excessive. The GAO concluded that in order to determine whether title rates are excessive, it is essential for regulators to get more detailed information on agents costs, exactly what the California Department of Insurance (CDI) proposed regulations seek to do. Finally, the GAO emphasized the importance of enforcement actions against illegal activities as one way of keeping costs down.

In its analysis, the GAO recognized that California far and away leads the nation in enforcement actions.

Below are two tables from the GAO report on the outcome of investigations into title insurance practices in California as compared to other states.

"This report will further support our efforts and help serve as a catalyst for change within the title insurance industry in California and across the nation," said Poizner. "The big winner here will be consumers."