From time to time, title insurers have come under fire for not providing coverage in those rare occasions when people need to file claims.
Bob Ford, a Villa Park-based real estate investor, said in 40 years of buying and selling real estate he has made three title insurance claims -- and each time he had to sue the title company to get it to pay.
"They are very reluctant to pay claims," Ford said. "I succeeded in each case but I didn't get my attorney's fees back, so I probably lost money."
Morgan said such situations are infrequent.
"I'm not saying that disagreements don't arise over whether a loss is covered, but by and large that's a very, very rare instance," he said.
People who do try to shop for title insurance will find their choices considerably limited. Because of consolidation, First American, Fidelity National, LandAmerica and Stewart Title now control 92% of the California title insurance market, up from 72% for the top four companies in 1998.
Poizner said he is trying to remove red tape to allow new title insurance companies to move into the market and create competition. Critics say the only thing title insurers compete for now is the intermediaries -- real estate agents and others -- who bring them paying customers. The policy buyer ends up paying for this added expense, said Hunter, Rousmaniere and others.
"Competition by sellers of title insurance does not benefit consumers the way it is supposed to," said Jack Guttentag, professor emeritus of finance at the University of Pennsylvania's Wharton School. "When title companies compete, you lose."
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scott.wilson@latimes.com
