Old Republic Title Insurance will be the the first title insurance underwriter to participate in the launch.
The company’s system also aims to accelerate efficiency, minimize risks and coordinate exchanging previous title insurance policies between underwriters that “contribute to the system.”
According to the press release, Old Republic Title Insurance will be the the first title insurance underwriter to participate in the launch.
Dennis J. Gilmore, CEO of First American Financial, said the company’s motion to add a blockchain system to its platform will reduce risks and improve the real estate transaction process.
“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,” he said.
Policies included in the blockchain system will each have a unique code identifiable by property, which will improve search processes and improve the accuracy of searches for previous title insurance policies.
The company claims that sharing policy information with title insurance underwriters will benefit both consumers and underwriters “as it both increases efficiency and reduces risk.”
“This blockchain system melds that established practice with emerging technology to further increase efficiency and lower risk in the title production process,” the company claims.
Overall, the real estate industry’s move to blockchain is only going to grow from here. According to a report issued by Technavio in July, the real estate market lacks transparency, but says that can be changed thanks to blockchain.
The report claims blockchain can hep with real estate transactions and payments, which can be received right away and even after hours.
“The technology eliminates the need for middlemen involved in transactions and ensures smooth and fast transactions,” the report says.
Blockchain also has the potential to eliminate frauds in real estate with thorough background checks.
“An increased use of blockchain in real estate management software is seen to protect consumers interests from external factors,” an unnamed senior analyst at Technavio said in the release. “Advantages offered by blockchain are likely to cause a shift from traditional methods to blockchain based real estate transactions.”
First American Financial did not reveal when the platform would be made available to other participants.
Following Wednesday’s announcement, shares of the company increased 3.5 percent from US$46.60 to close Thursday’s (November 29) trading session at US$48.24.
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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any company mentioned in this article.