Virginia Lawyers Weekly

ALPS, the legal malpractice insurance carrier endorsed by the Virginia State Bar, is buying Southern Title Insurance Corp.
Both firms are privately held and details of the stock purchase agreement were not disclosed. The deal is expected to close in early July.

“We are always looking for ways that we can help lawyers in Virginia practice better and practice smarter, and this makes sense,” said Robert W. Minto Jr., president and CEO of ALPS, which is based in Missoula, Mont.

Minto said the ability to offer title insurance is especially valuable in states in which its insured attorneys perform title closing services – Virginia, South Carolina and West Virginia.

In a joint press release, ALPS and Southern Title said, “Unique opportunities will exist for risk management activities between the two companies, and each company will continue to work to build market share in low-risk, rural areas.”

Minto cited Tennessee as one such market. Southern Title is well-established there and would provide a base for ALPS to offer its products, he said.

ALPS operates in 24 states, and Richmond-based Southern Title is licensed in 17 states, but Virginia, South Carolina and West Virginia are the only states in which both do business.

“We are excited about the synergistic possibilities,” Southern Title President Eugene McCullough said. The acquisition gives “each of us an opportunity to grow as we offer an enhanced combination of services to each company’s core clientele.”

He added, “ALPS’ focus on providing superior protection and continuing legal education to its insureds, along with a wide range of financial and risk management services, complements Southern’s singular focus on providing superior service to independent title agents.”

McCullough said the title insurance industry is dominated by four companies – First American Title Insurance Co., Old Republic Title Co., Fidelity National Title Insurance Co. and Stewart Title Guaranty Co. – that have shifted their focus to agencies they own or to major real estate players such as lenders or developers that they are associated with. Almost a fifth of the roughly 100 title companies doing business in the country merged or went out of existence last year, he said.

Minto said each company will operate independently, and ALPS’ insureds will not be required to use Southern Title as their title insurer.

The nationwide trend has been for lawyers to be less involved in the sale of residential real estate. South Carolina is the only state in which attorneys must conduct closings, but Minto said attorneys are involved in real estate transactions in 15 other states, including Virginia.

ALPS is a risk retention group wholly owned by ALPS Corp. In 2008, ALPS RRG, the entity acquiring Southern Title, had $37 million gross written premium with a surplus of $26 million. Its parent company has total assets of more than $120 million. Southern Title had $43 million in gross revenues last year and had net admitted assets of more than $25 million.

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