There are many different companies that rate title insurance providers. Some of them have been around for a long time. One of the oldest is A.M. Best, which was founded in 1899. Others like Demotech, which was formed in 1985, are not as old but are still very influential. Regardless of when they were founded, these companies and a handful of others like them make it their business to know the ins and outs of the insurance game. They look very closely at insurance companies and assess their ability to take care of their policyholders.
These ratings are important because they measure an insurer’s ability to honor the obligations of its policies. One of the most commonly used scales for this ratings system is a letter designation (“A”, “B”, “C” and so on) sometimes coupled with a symbol, such as “+” or “?”. These designations represent the grading given to that title insurance company. Examples of such grading are “Exceptional”, “Adequate”, “Strong”, and “Poor”. Any grading of A or higher indicates the insurer is financially stable and therefore able to fulfill claim obligations to its policyholders.
What many people don’t realize is that these ratings are for the insurers, and not the independent agents and title companies that you end up working with on the sale. At Metropolitan Title, we have used these ratings to vet and select as partners only insurers with the highest ratings. All of our policies are underwritten by either First American Title Insurance Company or General Title Insurance. Demotech has given First American Title Insurance Company its A”(Unsurpassed) grading and General Title it’s A (Exceptional) grading.
Having multiple underwriters allows us to offer our clients the insurers and policies that best suit their needs. Selecting underwriters with exceptional ratings allows us to be there when our customers need us most.
When considering title companies, do some investigation. Make sure the insurers issuing the policy on your property are stable. Ask the title company for the ratings of their underwriters. Or, find out which insurers work with the different title companies and do the homework yourself. You’ll be glad you did.