I would think that this would be a rough time to try to set up new direct operations.  However, First American had quite a presence in Colorado with Mercury.  When that agent went belly-up, and worse, sold out to Fidelity, First American was left high and dry.  I guess the quickest way to recapture what they can of that market is with direct operations.  It would take a long time to restablish a large presense with agencies.  Direct operations also gives them more control to go after marketshare aggressively - something that small agents probably aren't in a position to do in this market.

The Mercury companies that Fidelity bought controlled about 30% of the market.  First American provided almost $100 million in financing to bankroll the companies during the booming market.  Fidelity snapped them up for only $5 million.  That was quite a coup for Fidelity... and huge blow to First American. 

Best,
Robert A. Franco
SOURCE OF TITLE