WASHINGTON–(BUSINESS WIRE)–A poor year in the national real estate market left the land title
industry posting losses in 2008. The continued slowing of real estate
sales and refinances is directly related to the reduction of title
insurance transactions and revenues, and a continuing rise in loss and
loss adjustment expenses for the land title industry in 2008. The
industry posted a 2008 operating loss of $710.3 million, compared to an
operating loss of $87.8 million for 2007.

“The land title industry is beginning to see an increase in orders and
is anticipating growth based on a growing market for refinance
transactions,” said Kurt Pfotenhauer, CEO of the American Land Title
Industry. In April, the Mortgage Bankers Association’s revised its
forecast of mortgage originations in 2009, increasing their forecast by
over $800 billion. MBA now expects originations to total $2.78 trillion,
which would make 2009 the fourth highest originations year on record,
behind only 2002, 2003, and 2005. “This is welcome news following a very
tough market in 2008,” Pfotenhauer continued.

The reduction in operating gain, combined with a 46% decrease in net
investment gain, was somewhat offset by a significant reduction of
income taxes and resulted in a Net Loss for 2008 of $434.2 million, as
compared to Net Income of $315.1 million for 2007.

Despite the financial struggles of 2008, the land title industry remains
in a strong financial position with Admitted Assets of almost $9
billion, including more than $7 billion in Cash and Invested Assets.
Also, Statutory Reserves were in excess of $5.3 billion and Statutory
Surplus was over $2.0 billion.

The 4th Quarter of 2008 marked the 11th consecutive quarter in which
title premiums written declined from the prior year’s equivalent
quarter, indicating that poor markets not only continued through 2008,
but were still worsening through year end.

Furthermore, each year-over-year quarter’s decline was greater than the
previous quarter. In 2007, the 3^rd Quarter declined more than
15% over the prior year’s 3^rd Quarter, and the 4^th Quarter
decline was 22% over the prior year’s 3^rd Quarter. In 2008,
the 1^st Quarter declined 26% from the prior year’s 1^st
Quarter; the 2^nd Quarter declined almost 28%; the 3^rd
Quarter more than 30%; and the 4^th Quarter declined over 34%.

On a state-by-state basis, 28 states plus the District of Columbia were
down over 30% in the 4^th Quarter of 2008 from the prior
year’s equivalent quarter. Only six states showed increases, with North
Dakota, Arkansas and South Dakota up 53, 37 and 24%, respectively; and
Alaska, Vermont and Iowa up less than 15%. The four largest states in
terms of written premiums, California, Texas, Florida and New York, were
down 23, 34, 46 and 47%, respectively. The fifth largest state, New
Jersey, was down 30%; the seventh largest, Pennsylvania, down 40%; and
the eighth largest, Virginia, was down 31%.

Title Insurance Industry Market Share and Statistical Analysis
compilations for the 4th Quarter and the full year, 2008 are now
available on the ALTA website at www.alta.org/industry/financial.cfm.

About ALTA

The American Land Title Association®, founded in 1907, is the national
trade association and voice of the abstract and land title insurance
industry. ALTA® members search, review and insure land titles to protect
home buyers and mortgage lenders who invest in real estate. ALTA® is
headquartered in Washington, DC.