Profile: Stewart Information Services Corp (STC.N)
9 Dec 2013
Stewart Information Services Corporation (Stewart), incorporated on March 25, 1970, is a customer-focused, global title insurance and real estate services company offering products and services through its direct operations, network of approved agencies and other companies within the Stewart family. Its business segments include title insurance and related services and mortgage services. The Company provides these services to homebuyers and sellers; residential and commercial real estate professionals; mortgage lenders and servicers; title agencies and real estate attorneys; home builders; and United States and foreign governments. Stewart also provides loan origination and servicing support; loan review services; loss mitigation; REO asset management; home and personal insurance services; and technology to streamline the real estate process.
Its international division delivers products and services protecting and promoting private land ownership worldwide. Its international operations are in Canada, the United Kingdom, Central Europe, Central America and Australia.
Title Insurance Services
Title insurance and related services (title segment) include the functions of searching, examining, closing and insuring the condition of the title to real property. The title segment also includes certain ancillary services provided for tax-deferred exchanges and home and personal insurance services. The purpose of a title examination is to ascertain the ownership of the property being transferred debts that are owed on it and the scope of the title policy coverage. This involves searching for and examining documents such as deeds, mortgages, wills, divorce decrees, court judgments, liens, paving assessments and tax records. Title insurance is substantially different from other types of insurance. Fire, auto, health and life insurance protect against future losses and events. In contrast, title insurance insures against losses from past events and seeks to protect the public by eliminating covered risks through the examination and settlement process. In essence, a title insurance policy provides a warranty to the policyholder that the title to the property is free from defects that might impair ownership rights.
Title insurance, however, is issued for a one-time premium and the policy provides protection for as long as the owner owns the property or has liability in connection with the property. Also, a title insurance policy does not have a finite contract term, whereas other lines of insurance have a definite beginning and ending date for coverage. Although a title insurance policy provides protection as long as the owner owns the property being covered, the title insurance company generally does not have information about which policies are still effective. The other lines of insurance receive periodic premium payments and policy renewals thereby allowing the insurance company to know which policies are effective
The Company’s title insurance underwriters maintain investments in accordance with certain statutory requirements for the funding of statutory premium reserves and state deposits. It has established policies and procedures to minimize its exposure to changes in the fair values of its investments. These policies include retaining an investment advisory firm, emphasizing credit quality, managing portfolio duration, maintaining or increasing investment income and actively monitoring profile and security mix based upon market conditions. Title insurance revenues are closely related to the level of activity in the real estate markets it serves and the prices at which real estate sales are made. Real estate sales are directly affected by the availability and cost of money to finance purchases. Other factors include consumer confidence and demand by buyers. These factors may override the seasonal nature of the title business.
The primary sources of title insurance business are attorneys, builders, developers, home buyers and home sellers, lenders and real estate brokers and agents. No one customer was responsible for as much as 10% or more of its consolidated revenues in any of the last three years. Titles insured include residential and commercial properties, undeveloped acreage, farms, ranches, wind and solar power installations and water rights.
The Company’s mortgage services segment includes a diverse group of products and services provided to multiple markets. These services are provided principally through its Stewart Lender Services (SLS), PropertyInfo Corporation and Stewart Government Services businesses. SLS offers origination support, loss mitigation, default, and post-closing services to residential mortgage lenders, servicers and investors. Loss mitigation products include loan modification, loan review, loan default and REO asset recovery services. SLS also offers outsourcing solutions for post-closing and servicing support to lenders. PropertyInfo Corporation offers technology that a title business requires. PropertyInfo offers a production system, AIM+, along with web-based search tools designed to increase the processing speed of title examinations by connecting all aspects of the title examination process to proprietary title information databases and to public land and court record information sources.
Mortgage services revenues are generated by lender services, which are closely related to the level of activity in the real estate market, including the volume of foreclosure or other distressed property activity. Revenues related to many services are generated on a project basis. Customers for mortgage services products and services primarily include mortgage lenders and servicers, mortgage brokers, mortgage investors and government entities. The services and products offered by its mortgage services segment are used by professionals and intermediaries who have been retained to assist consumers with the sale, purchase, mortgage, transfer, recording and servicing of real estate-related transactions.
The Company competes with Fidelity National Financial, Inc., Old Republic Title Insurance Group, and The First American Corporation.
Stewart Information Services Corp
Ste. 800, 1980 Post Oak Blvd
HOUSTON TX 77056