First American Financial has reported a net loss of $15.3m, or 0.15 per diluted share, for the first quarter of 2011, compared to a net income of $13.8m, or 0.13 per diluted share, in the first quarter of 2010.
The insurer said current quarter loss includes a $45.3m reserve strengthening adjustment in the company’s Canadian operations, which is $27.2m on an after-tax basis, or 0. 26 cents per diluted share.
Total revenues for the first quarter of 2011 were $931.7m, compared to $908.4m for the same period last year.
The revenues for the title insurance and services segment were $861.4m, a 3% increase from the same quarter of 2010.
First American Financial Corporation CEO Dennis Gilmore said the company is disappointed that its first quarter results were impacted by a reserve strengthening charge it took in connection with a guaranteed valuation product the firm sell exclusively in Canada.
"We are canceling the product in its current form and are looking to reinsure a modified version. If we cannot reinsure all or most of the risk, we will terminate the product.
"Increased claims in our domestic title operations also negatively impacted Title Insurance and Services segment results. However, our commercial business and national lender operations continued to perform well. In addition, our specialty insurance segment continued its strong performance in both the home warranty and property and casualty insurance business lines, achieving a pretax margin of 17.8 % in the quarter,"Gilmore said.