Two of the biggest names in title insurance are joining together to bring blockchain to the title insurance industry.
First American Financial announced Wednesday that it is launching a shared blockchain system to be used in the title insurance process. And the first company to sign on to use First American’s blockchain system is Old Republic Title Insurance Group, the nation’s third largest title insurance underwriter.
The blockchain system, which First American designed, is intended to facilitate the exchange of prior title insurance policies between underwriters that contribute to the system, First American said.
According to First American, the blockchain system will “increase efficiency, reduce risk and improve the title production process.”
First American said that each title insurance policy in the system will be coded with a unique identifier by property, which should streamline the search process and increase the accuracy of searches for prior title insurance policies.
According to First American, it is common practice for title insurance underwriters to share policy information, as it both increases efficiency and reduces risk. First American claims that its new blockchain system will merge this industry practice with “emerging technology” to further increase efficiency and lower risk.
Blockchain provides an unchangeable, time-stamped ledger that is seemingly more secure than traditional systems because it’s managed by a large network of computers, rather than one central server.
Once data is shared on a blockchain, all parties on the blockchain can see if any changes are made. Therefore, it’s far less likely to be hacked than a central server or individual account.
And now, First American is bringing blockchain to the title insurance business.
“First American has a long history of innovation and our development of this system demonstrates our ongoing commitment to applying state-of-the-art technologies that reduce risk and improve the real estate transaction process,” First American CEO Dennis Gilmore said.
“The potential exists to create a robust exchange of title insurance policy information that delivers greater transparency, efficiency and accountability to the industry and enhances the closing experience for consumers,” Gilmore added.