A new breed of insurance company is promising discounts on a type of policy many home buyers don’t even realize they need: title insurance.
Almost everyone who buys a house also purchases title insurance. Mortgage lenders generally require that borrowers buy a so-called lender’s policy. Owners can buy a separate policy for themselves.
The insurers determine if there is clear ownership of the property and offer protection if someone later claims an ownership interest in it. Title insurance can cost hundreds of dollars for modest houses and thousands for multimillion-dollar properties. There often is little incentive to shop around, and consumers tend to rely on a mortgage broker, real-estate agent or lawyer to connect them with a title insurer.
Now two upstart insurers, EnTitle Insurance, a subsidiary of Entitle Direct Group, which now operates in 40 states and the District of Columbia, and OneTitle National Guaranty, which recently started offering policies in New York state, are marketing directly to consumers on the Internet, offering online quotes to home buyers who plug in basic information about the property. They are offering savings of up to 35% off what established firms charge.
EnTitle tries to draw consumers to its website, entitledirect.com, through online marketing, email campaigns, traditional advertising and word-of-mouth, says Timothy Dwyer, founder of the firm, which launched in 2009.
Insurance agencies also are being more aggressive in competing for title-insurance business. Redfin, a real-estate agency based in Seattle that has pioneered the use of technology in real-estate sales, started a title-insurance agency, Title Forward, in early 2013. Title Forward is telling customers it can save them money by helping them.
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Green Real Estate Appraiser 