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Fidelity National Financial is the largest U.S. title insurance company, but also has five other operating segments: Title Insurance (70% of 2004 total revenues), which provides core title insurance and escrow and other title related services; Specialty Insurance (3%), which issues flood, home warranty, homeowners, automobile and niche personal lines insurance policies; Financial Institution Software and Services (FISS, 15%), which focuses on financial institution processing and mortgage loan processing; Lender Outsourcing Solutions (LOS, 4%), which consists of loan facilitation (customized title agency and closing) and default management services; Information Services (IS, 7%), which offers property data and real estate related information services; and Corporate and Other (1%), which consists of operations of the parent holding company and its wholly-owned equipment leasing subsidiary as well as other small operations. The FISS, LOS and IS segments make up the businesses of FIS.
FNF is in the property and causualty insurance industry and the foremost trend affecting most property-casualty (P/C) insurers is a softening in premium rates for most lines of business. After years of extremely competitive premium pricing conditions brought on by an overabundance of underwriting capacity, signs of pricing strength in some commercial lines first emerged in 2000 and continued through 2001, 2002, and well into 2003. However, industrywide written premium growth was a modest 4.7% in 2004. Emerging evidence suggests that the rate of premium price hikes is moderating further and, in some lines of business, softening. This is particularly true in the standard, more commodity-type lines of coverage and in certain property lines of coverage. Highly specialized coverage lines are less likely to be subject to relatively aggressive rate decreases.
Stock Monkey's crib is mostly likely titled by FNF and if I was going to put my crib up for sale, FNF's MLS software would probably be on most realtor's computers. With strong ties to the housing and insurance market, this seems like a very long-term pick. Beware of risk, because the ideas of housing bubbles and hurricanes hitting the hot Florida housing markets brings possible risk. Short-term volitility is present but the monkey like his bananas for the long-haul and real estate/insurance industries are long-haul industries, and FNF touches both.
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