Saturday, January 05, 2008
AG Wants Superintendent To Reduce Title Insurance Rates
SANTA FE Attorney General Gary King has asked the state insurance superintendent to reduce title insurance rates by more than 11 percent, saying insurance companies have no incentive to compete on prices charged to customers.
"This creates fertile ground for the possibility of inflated expenses, negatively affecting the rate charged to the consumer,'' King said Friday in a statement. "In fact, we think the current system has created reverse competition which is definitely not in the best interests of New Mexico homeowners.''
King's office said the state Insurance Commission is expected to respond to his request within 30 days.
Insurance Superintendent Morris Chavez could not be reached for comment after business hours Friday.
The superintendent, who falls under the Public Regulation Commission, sets New Mexico's title insurance rate each year after a hearing. The rate is the same among all companies.
In November, all five members of the PRC asked Gov. Bill Richardson to place title insurance reform before the 30-day legislative session that begins in less than two weeks. The commissioners made the request in a letter, saying the state's title insurance laws need to be changed and that consumers would benefit.
The New Mexico Land Title Association, which represents the title insurance industry, has opposed bringing the issue before the Legislature.
The association's executive director, Ed Roibal, has said that although companies charge the same rate, competition based on service and quality is fierce.
Title insurance rates also have come under fire in the courtroom. Three New Mexico consumers have filed lawsuits seeking lower title insurance rates.
According to 2007 information from BankRate.com, New Mexico has the 15th most expensive title insurance rates. The average New Mexico policy costs $755.27; the national average is $707.30.
Copyright ©2008 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.