Santa Ana-based title insurer First American Corp. said Thursday that it bought privately held United General Financial Services Inc. for an undisclosed price.
Denver-based United General had sales of $208 million last year. The title insurer was acquired in a management buyout in 1995 by president and chief executive, John P. Dwyer and key management.
Dwyer is set to continue managing United General as company president and regional vice president with First American Title Insurance Co., a unit of First American. In addition to Dwyer, all key management personnel are expected to remain with United General.
United General has operations in California, New York, Texas and Florida, among others.
It was the U.S.’s sixth-largest title insurer in 2003 with 1.64% of the market, according to the American Land Title Association. Founded in Louisiana in 1983, United General moved to Denver in 1999.
First American is the No. 2 title insurer behind Fidelity National Financial Inc., which moved from Irvine to Florida two years ago. In January, a jury hit First American with $43.2 million in damages in a lawsuit with rival Fidelity National Financial.
The lawsuit filed by Fidelity’s Chicago Title Insurance Corp. charged First American with violating a noncompetition agreement and “intentional interference with contract.”
The title insurance industry has hit some bumps of late.
Last week First American said it would refund about $24 million to customers after state insurance investigators in Colorado claimed it gave kickbacks to homebuilders, lenders and real estate agents. First American said it would no longer pay for referrals.
California Insurance Commissioner John Garamendi said he was investigating the industry on the kickback issue, which has been common among all title insurers.
Yesterday LandAmerica Financial Group Inc. and Fidelity National Financial Inc. said they would no longer pay homebuilders, lenders and real estate agents for referrals.
Another challenge for title insurers could be a slowing housing market. The companies depend on high volume of home sales to spur revenue.
