AUSTIN — Complaining that Texans now pay the highest title-insurance rates in the country, a powerful duo of business and conservative groups called Tuesday for sweeping reforms to lower the costs by dropping anti-competition rules.
In a morning announcement, the Texas Association of Business and the Texas Public Policy Foundation — both of which carry considerable clout with Republican leadership at the statehouse — said they plan to push for changes in state law to spur more competition.
“Allowing title insurers to compete for consumers’ business in Texas, as they do in most other states, would drive down prices, increase coverage options, and reduce closing costs for Texas home buyers and commercial real estate transactions,” said Bill Hammond, CEO of the business group.
Arlene Wohlgemuth, executive director of the Texas Public Policy Foundation, the conservative Austin-based think tank that helps drive much of the legislative agenda in Texas, agreed: “This arcane and unnecessary system prohibits consumers from shopping for better prices and quality on title insurance, and prohibits insurers from offering lower prices or additional coverage options.”
According to a study commissioned by Hammond’s group, 91 percent of Texans say that if they can shop around for automobile and home insurance, they should be able to shop around for the best deals on title insurance.
Wohlgemuth said her organization plans to start an education campaign this year to convince Texans about the hundreds of millions of dollars they could save by introducing competition, and called on state lawmakers to take action next legislative session.
Bill Peacock, TPPF’s vice president of research, said competition will bring to consumers and businesses the same kinds of savings it already has provided in Texas’ electricity, homeowners insurance, and telecommunications markets.
According to Hammond, Texans who buy a home or refinance a mortgage are paying hundreds of dollars more for title insurance than consumers in states like California, New York, Massachusetts or New Jersey. “It’s time for Texans to demand change,” he said.
This story was published in the Houston Chronicle on Feb. 2, 2016.