Any homeowner who has suffered a calamity of title, small or large, learns how very valuable the coverage is. So, like fire insurance, we hope you never have to use it, but if trouble comes to your door, you’ll be very happy that you have owner coverage.

The split between a title underwriter and the attorney or title agent who creates the policy is not a kickback. It’s payment for services rendered when the transaction has been processed in a traditional manner.

When a traditional title insurance policy is created, the producer [attorney or title agent] handles the search, examination and correction of issues prior to the issuance of the policy. They also normally also handle the closing. The purpose of examination is to eliminate potential claims and this is why they retain the lion’s share of the premium. The title company gets the rest of the premium to cover claims due to mistakes in examination or fraud or other sorts of errors that could not be found through competent examination. It’s payment for a safety net.