UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      D.C. 20549





**FORM
      10-K**





xANNUAL
      REPORT
      PURSUANT TO SECTION 13 OR 15(d) OF


THE
      SECURITIES EXCHANGE ACT OF 1934


for
      the
      fiscal year ended December 31, 200 7





oTRANSITION
      REPORT
      PURSUANT TO SECTION 13 OR 15(d)


OF
      THE
      SECURITIES EXCHANGE ACT OF 1934


for
      the
      transition period from __to __





Commission
      file number 0-11774





**INVESTORS
      TITLE COMPANY**


(Exact
      name of registrant as specified in its charter)





**North
                Carolina**
            **56-1110199**(State
                or other jurisdiction of
              incorporation
                or organization)
            (I.R.S.
                Employer
              Identification
                No.)





**121
      North Columbia Street**


**Chapel
      Hill, North Carolina 27514**


**(919)
      968-2200**


(Address
      and telephone number of principal executive office)





Securities
      registered pursuant to section 12(b) of the Act:


**Common
      Stock, no par value**





Securities
      registered pursuant to section 12(g) of the Act:


None





Indicate
      by check mark whether the registrant is a well-known seasoned issuer, as defined
      in Rule 405 of the Securities Act.


Yes
o
      No x




Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Exchange Act.


Yes
o
      No x





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes x No
o





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of registrant's knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. x





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, a non-accelerated filer, or a smaller reporting company.
      See
      the definitions of “large accelerated filer,” “accelerated filer” and “smaller
      reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large
      accelerated filer  o 
Accelerated filer  x 
      Non-accelerated filer o Smaller
      reporting company


(Do
      not
      check if a smaller
      reporting company)





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act). Yes oNo x





The
      aggregate market value of the common shares held by non-affiliates was
      $90,590,399 based on the closing sales price on the NASDAQ National Market
      System on the last business day of the registrant's most recently completed
      second fiscal quarter (June 30, 2007).





As
      of
      March 7, 2008, there were 2,703,154 common
      shares of the registrant outstanding.










**DOCUMENTS
      INCORPORATED BY REFERENCE**





Portions
      of Investors Title Company's Annual Report to Shareholders for the fiscal year
      ended December 31, 2007 are incorporated by reference in Parts I, II and IV
      hereof and portions of Investors Title Company's definitive proxy statement
      for
      the Annual Meeting of Shareholders to be held on May 21, 2008 are incorporated
      by reference in Part III hereof.




1


**SAFE
      HARBOR FOR FORWARD-LOOKING STATEMENTS**




This
      Annual Report on Form 10-K, as well as information included in future filings
      by
      the Company with the Securities and Exchange Commission and information
      contained in written material, press releases and oral statements issued by
      or
      on behalf of the Company, contains, or may contain, “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995
      that
      reflect management’s current outlook for future periods. These statements may be
      identified by the use of words such as "plan," "expect," "aim," "believe,"
      "project," "anticipate," "intend," "estimate," "should," "could" and other
      expressions that indicate future events and trends. All statements that address
      expectations or projections about the future, including statements about the
      Company's strategy for growth, product and service development, market share
      position, claims, expenditures, financial results and cash requirements, are
      forward-looking statements. Forward-looking statements are based on certain
      assumptions and expectations of future events that are subject to a number
      of
      risks and uncertainties. Actual future results and trends may differ materially
      from historical results or those projected in any such forward-looking
      statements depending on a variety of factors, including, but not limited to,
      the
      following:




·
            the
                demand for title insurance will vary over time due to factors such
                as the
                level of real estate transactions, the level of mortgage origination
                volumes including refinancing and changes to the insurance requirements
                of
                the participants in the secondary mortgage
                market;


·
            significant
                changes to applicable government regulations;


·
            losses
                from claims may be greater than anticipated such that reserves for
                possible claims are inadequate;


·
            heightened
                regulatory scrutiny;


·
            unanticipated
                adverse changes in securities markets, including interest rates,
                could
                result in material losses on the Company's investments;


·
            the
                Company's dependence on key management personnel, the loss of whom
                could
                have a material adverse affect on the Company's business;


·
            the
                Company’s ability to develop and offer products and services that meet
                changing industry standards in a timely and cost-effective manner;


·
            the
                requirement by state statutes of the Company’s insurance subsidiaries to
                maintain minimum levels of capital, surplus and reserves and restrict
                the
                amount of dividends that the insurance subsidiaries may pay to the
                Company
                without prior regulatory approval; and


·
            the
                concentration of key accounting and information systems in a few
                locations.





For
      a
      description of factors that may cause actual results to differ materially from
      such forward-looking statements, see Item 1A, “Risk Factors” of this annual
      report on Form 10-K.





These
      and
      other risks and uncertainties may be described from time to time in the
      Company's other reports and filings with the Securities and Exchange Commission.
      The Company does not undertake to update any forward-looking statements to
      reflect circumstances or events that occur after the date the forward-looking
      statements are made.




2





**INVESTORS
      TITLE COMPANY AND SUBSIDIARIES**





TABLE
      OF
      CONTENTS





PART
                IITEM
                1.
            BUSINESS
            4ITEM
                1A.
            RISK
                FACTORS
            13ITEM
                1B.
            UNRESOLVED
                STAFF COMMENTS
            17ITEM
                2.
            PROPERTIES
            18ITEM
                3.
            LEGAL
                PROCEEDINGS
            18ITEM
                4.
            SUBMISSION
                OF MATTERS TO A VOTE OF SECURITY
                HOLDERS
            18PART
                IIITEM
                5.
            MARKET
                FOR REGISTRANT'S COMMON EQUITY; RELATED STOCKHOLDER
                MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
            20ITEM
                6.
            SELECTED
                FINANCIAL DATA
            21ITEM
                7.
            MANAGEMENT'S
                DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                AND RESULTS OF OPERATIONS
            21ITEM
                7A.
            QUANTITATIVE
                AND QUALITATIVE DISCLOSURES ABOUT MARKET
                RISK
            21ITEM
                8.
            FINANCIAL
                STATEMENTS AND SUPPLEMENTARY
                DATA
            21ITEM
                9.
            CHANGES
                IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                AND FINANCIAL DISCLOSURE
            21ITEM
                9A.
            CONTROLS
                AND PROCEDURES
            22ITEM
                9B.
            OTHER
                INFORMATION
            23PART
                IIIITEM
                10.
            DIRECTORS,
                EXECUTIVE OFFICERS AND CORPORATE
                GOVERNANCE
            24ITEM
                11.
            EXECUTIVE
                COMPENSATION
            24ITEM
                12.
            SECURITY
                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                MANAGEMENT AND RELATED STOCKHOLDER MATTERS
            24ITEM
                13.
            CERTAIN
                RELATIONSHIPS AND RELATED TRANSACTIONS, AND
                DIRECTOR INDEPENDENCE
            25ITEM
                14.
            PRINCIPAL
                ACCOUNTANT FEES AND SERVICES
            25PART
                IVITEM
                15.
            EXHIBITS
                AND FINANCIAL STATEMENT
                SCHEDULES
            26SIGNATURES
            
            27




3


**PART
      I**




**ITEM
      1.****BUSINESS**





GENERAL





Investors
      Title Company (the "Company") is a holding company that operates through its
      subsidiaries and was incorporated in the state of North Carolina in February
      1973. The Company became operational on June 24, 1976, when it acquired
      Investors Title Insurance Company ("ITIC") as a wholly owned subsidiary under
      a
      plan of exchange of shares of common stock. On September 30, 1983, the Company
      acquired Northeast Investors Title Insurance Company ("NE-ITIC"), formerly
      Investors Title Insurance Company of South Carolina, as a wholly owned
      subsidiary under a plan of exchange of shares of common stock. Investors Capital
      Management Company ("ICMC"), a wholly owned subsidiary of the Company, was
      organized on October 17, 2003. The Company's most recent subsidiary, Investors
      Trust Company ("Investors Trust"), was granted a trust charter by the North
      Carolina Banking Commissioner on February 17, 2004. The Company's executive
      offices are located at 121 North Columbia Street, Chapel Hill, North Carolina
      27514 and
      its
      telephone number is (919)
      968-2200. The
      Company maintains a website at www.invtitle.com .





OVERVIEW
      OF THE BUSINESS





The
      Company engages in several lines of business .
      Its
      primary business
      activity is the issuance of residential and commercial title insurance through
      ITIC and NE-ITIC. The second line of business provides tax-deferred real
      property  exchange
      services through its subsidiaries, Investors Title Exchange Corporation (“ITEC”)
      and Investors Title Accommodation Corporation (“ITAC”). The Company entered into the
      business of providing investment management and trust services to individuals,
      trusts and other entities in 2003. The Company has two reportable operating
      segments. The title insurance segment consists of the operations of ITIC and
      NE-ITIC. The exchange services segment consists of the operations of ITEC and
      ITAC. See Item 7. Management's Discussion and Analysis of Financial Condition
      and Results of Operations and Note 13 of Notes to Consolidated Financial
      Statements in the 2007 Annual
      Report to Shareholders incorporated by reference in this Form 10-K Annual Report
      for additional information related to the revenues, income and assets
      attributable to the Company's primary
      operating segments.




Title
      Insurance





Through
      its two wholly owned title underwriting subsidiaries, ITIC and NE-ITIC, the
      Company underwrites land title insurance for owners and mortgagees as a primary
      insurer. ITIC and NE-ITIC offer primary title insurance coverage to both owners
      and mortgagees of real estate and also offers the reinsurance of title insurance
      risks to other title insurance companies. Title insurance protects against
      loss
      or damage resulting from title defects that affect real property. The commitment
      and policies issued are predominantly the standard American Land Title
      Association (“ALTA”)  approved
      forms.





*Title
      Insurance Policies.* There
      are
      two basic types of title insurance policies - one for the mortgage lender and
      one for the real estate owner. A lender often requires property owners to
      purchase title insurance to protect its position as a holder of a mortgage
      loan,
      but the lender's title insurance policy does not protect the property owner.
      The
      property owner has to
      purchase a
      separate owner's title insurance policy to protect their investment. The Company
      issues title insurance policies on the basis of a title report. The title report documents
      the current status of title to the property.




4





Upon
      a
      closing, the seller executes a deed to the new owner.  When
      real
      property is conveyed from one party to another, occasionally there is an
      undisclosed defect in the title or a mistake in a prior deed, will or mortgage
      that may give a third party a legal claim against such property. If a claim
      is
      made against real property, title insurance provides indemnification against
      insured defects. The title insurer has the option to retain counsel and pay
      the
      legal expenses to eliminate or defend against any title defects, pay any third
      party claims arising from errors in title examination and recording or pay
      the
      insured’s actual losses, up to policy limits, arising from title risks as
      defined in the policy.





A
      title
      risk is one of any number of things that could jeopardize the property owner's
      or mortgagee’s interest in the property defined in the title policy. Such risks
      include title being vested in someone or some entity other than the insured,
      unmarketable title, lack of a right of access to the property, invalidity or
      unenforceability of the insured mortgage, or other defects, liens, or
      encumbrances against the property. Examples of common types of covered risks
      include defects arising from prior unsatisfied mortgages, tax liens or confirmed
      assessments, judgments against the property or encumbrances against the property
      arising through easements, restrictions or other existing covenants. Title
      insurance also generally protects against deeds or mortgages that contain
      inaccurate legal descriptions, that were forged or improperly acknowledged
      or
      delivered, that were executed by spouses without the other spouse’s signature or
      release of marital interest or that were conveyed by minors or
      incompetents.





*Insured
      Risk on Policies in Force.* Generally,
      the amount of the insured risk or “face amount”of insurance on a title insurance
      policy is equal to the lesser of the purchase price of the insured property
      or
      the fair market value of the property. In the event that a claim is made against
      the property, the insurer is responsible for paying the legal costs associated
      with eliminating covered title defects or defending the insured party against
      covered  title
      defects affecting the property. The insurer may choose to pay the policy limits
      to the insured or, if the loss is less than policy limits, the amount of the
      insured’s actual loss due to the title defect,  at
      which
      time the insurer's duty to defend the claim and all other obligations of the
      insurer with respect to the claim are satisfied.





At
      any
      given time, the insurer's actual risk of monetary loss under outstanding
      policies is only a portion of the aggregate insured risk, or total face amount,
      of all policies in force. The lower risk results primarily from the reissuance
      of title insurance policies by other underwriters over time when the property
      is
      conveyed or refinanced. The coverage on a lender's title insurance policy is
      reduced and eventually terminated as the mortgage loan it secures is paid.
      An
      owner's policy is effective as long as the insured has an ownership interest
      in
      the property or has liability under warranties of title. Due to the variability
      of these factors, the aggregate contingent liability of a title
      underwriter  on
      outstanding policies of the Company and its subsidiaries cannot be determined
      with any precision.





*Losses
      and Reserves.*  While
      most other forms of insurance provide for the assumption of risk of loss arising
      out of unforeseen events, title insurance is based upon a process of loss
      avoidance. Title insurance generally serves to protect the policyholder from
      the
      risk of loss from events that predate the issuance of the policy.  Losses
      on
      policies typically occur when a title defect is not discovered during the
      examination and settlement process or the occurrence of certain hidden risks
      which cannot be determined from an accurate search of public land records.
      The
      maximum amount of liability under a title insurance policy is generally the
      face
      amount of the policy plus the cost of defending the insured’s title against an
      adverse claim. Reserves for claim losses are established based upon known
      claims, as well as  estimated  losses
      incurred but not yet reported to the Company , based
      upon historical experience and other factors.




5




Title
      claims can often be complex, vary greatly in dollar amounts and are affected
      by
      economic and market conditions and may involve uncertainties as to ultimate
      exposure, and therefore, reserve estimates are subject to variability. For
      a
      more complete description of the Company’s reserves for claims, see Item 7.
      Management’s Discussion and Analysis of Financial Condition and Results of
      Operations in the 2007 Annual Report of Shareholders incorporated by reference
      in this Form 10-K Annual Report.





*Geographic
      Operations.* ITIC
      was
      incorporated in the State of North Carolina on January 28, 1972, and became
      licensed to write title insurance in the State of North Carolina on February
      1,
      1972. At present, ITIC primarily writes land title insurance in
      22
      states and the District of Columbia, primarily in the eastern half of
      the  United
      States. ITIC is licensed to write title insurance in 44 states and the District
      of Columbia.





NE-ITIC
      was incorporated in the State of South Carolina on February 23, 1973, and became
      licensed to write title insurance in that state on November 1, 1973. It
      currently writes title insurance as a primary insurer and as a reinsurer in
      the
      State of New York. NE-ITIC is also licensed to write title insurance in 18
      additional states and  the
      District of Columbia.





Premiums
      from title insurance written in the state of North Carolina represent the
      largest source of revenue for the title insurance segment.  In
      the
      state of North Carolina, ITIC primarily  issues
      title insurance commitments and policies through branch offices. Title policies
      are primarily issued through issuing agents in other states. For a description
      of the level of net premiums written geographically by state, refer to Item
      7.
      Management's Discussion and Analysis of Financial Condition and Results of
      Operations in the 200 7 Annual
      Report of Shareholders incorporated by reference in this Form 10-K Annual
      Report.





Each
      state license authorizing ITIC or NE-ITIC to write title insurance must be
      renewed annually. These licenses are necessary for the companies to operate
      as a
      title insurer in each state in which they write
      premiums .





*Ratings.* The
      Company’s title insurance subsidiaries are regularly assigned ratings by
      independent agencies designed  to
      indicate their financial condition and/or
      its claims paying ability. The rating agencies determine ratings primarily
      by
      analyzing financial data. ITIC has been rated by two independent Fannie
      Mae-approved financial analysis firms, Demotech, Inc. and LACE Financial
      Corporation (“LACE”), with financial stability ratings of A" (A Double Prime), and
      B+,
      respectively. NE-ITIC's financial stability also has been recognized by
      Demotech, Inc. and LACE with ratings of A" (A Double Prime), and
      A,
      respectively. According to Demotech, title underwriters earning a Financial Stability Rating
      of A'' (A Double Prime) possess *Unsurpassed* financial stability related to maintaining positive surplus as regards
      policyholders, regardless of the severity of a general economic downturn or
      deterioration in the title insurance cycle. A LACE rating of “A” or “B+”
indicates that a title insurance company has a strong overall financial
      condition that will allow it to meet its future claims, and that, generally,
      the
      company has good operating earnings, is well capitalized and has adequate
      reserves.




6





*Reinsurance.* The
      Company assumes and cedes reinsurance with other insurance companies in the
      normal course of business. Reinsurance
      is a contractual arrangement whereby one insurer assumes some or all of the
      risk
      exposure written by another insurer. Ceded
      reinsurance is comprised of excess of loss treaties, which protects against
      losses over certain amounts.





In
      the
      ordinary course of business, ITIC and NE-ITIC reinsure certain risks with other
      title insurers for the purpose of limiting their risk exposure and to comply
      with state insurance regulations. They also assume reinsurance for certain
      risks
      of other title insurers for which they receive additional income. For the last
      three years, revenues from reinsurance activities accounted for less than 1%
      of
      total premium volume.





Exchange
      Services





In
      1988,
      the Company established Investors Title Exchange Corporation, a wholly owned
      subsidiary ("ITEC"), to provide services in connection with tax-deferred
      exchanges of like-kind property pursuant to Section 1031 of the Internal Revenue
      Code. ITEC acts as an intermediary in tax-deferred exchanges of property held
      for productive use in a trade or business or for investments, and its income
      is
      derived from fees for handling exchange transactions and interest earned on
      client deposits held by the Company.





Investors
      Title Accommodation Corporation ("ITAC") provides
      services for accomplishing reverse exchanges when taxpayers decide
      to acquire
      replacement property before selling the relinquished property.





In
      February 2006, the IRS proposed new regulations which, if adopted, may
      negatively affect the ability of qualified intermediaries to retain a portion
      of
      the interest earned on exchange funds held during exchange transactions. If
      passed as proposed, these regulations would adversely impact the exchange
      services segment and the Company’s net income, since a significant portion of
      the exchange segment’s revenues are based on retaining a portion of the interest
      income earned on deposits held. Refer to Item 7. Management’s Discussion and
      Analysis of Financial Condition and Results of Operations in the 200 7 Annual
      Report to Shareholders incorporated by reference in this Form 10-K Annual Report
      for additional information regarding IRS regulations.





Investment
      Management and Trust Services





Other
      services provided  include
      those offered by Investors Trust Company (“Investors Trust”), Investors Capital
      Management Company (“ICMC”), and Investors Title Management Services, Inc.
      (“ITMS”), all wholly owned subsidiaries of the Company. Investors Trust and ICMC
      work together to provide investment management and trust services to
      individuals, companies, banks and trusts. ITMS offers various consulting
      services to provide clients with the technical expertise to start and
      successfully operate a title insurance agency. These subsidiaries are not
      currently a reportable segment for which financial information is presented
      in
      the Company’s financial statements and are included and reported in the category
      All Other.




7




OPERATIONS
      OF SUBSIDIARIES





See
      Note
      13 of Notes to Consolidated Financial Statements in the 200 7 Annual
      Report to Shareholders incorporated by reference in this Form 10-K Annual Report
      for additional information related to the Company's operating
      segments.





Title
      Insurance





ITIC
      and
      NE-ITIC issue title insurance coverage through direct operations or through
      partially  owned
      or
      independent title insurance agents who
      issue
      title policies on behalf of ITIC or NE-ITIC. Title insurance premiums written
      reflect a one-time premium payment, with no recurring premiums.





Generally,
      premiums are recorded and recognized as revenue at the time of closing of the
      related transaction as the earnings process is considered complete. Where the
      policy is issued directly through a branch office, the premiums collected are
      retained by the Company. Where the policy is issued through a title insurance
      agent, the agent retains a majority of the premium as a commission.
      Title insurance commissions earned by the Company's agents are recognized as
      expense concurrently with premium recognition. The percentage of the premium
      retained by agents varies by region to region and is sometimes regulated by
      the
      states.





For
      a
      description of the level of net premiums written by direct and agency
      operations, refer to Item 7. Management's Discussion and Analysis of Financial
      Condition and Results of Operations in the 200 7 Annual
      Report to Shareholders incorporated by reference in this Form 10-K Annual
      Report.





Exchange
      Services





ITEC
      and
      ITAC provide customer services in connection with tax-deferred exchanges
      pursuant to Section 1031 of the Internal Revenue Code. Acting as a qualified
      intermediary, ITEC holds the proceeds from sales of relinquished properties
      until the acquisition of identified replacement properties occurs. ITAC
      facilitates reverse tax-deferred exchanges pursuant to IRS Revenue Procedure
      2000-37.





CYCLICALITY
      AND SEASONALITY





Title
      Insurance





Real
      estate activity is cyclical in nature. Title insurance premiums are closely
      related to the level of real estate activity and the volume of mortgage
      origination. A number of general and economic factors influence demand for
      title
      insurance, including changes in mortgage interest rates, consumer confidence,
      economic conditions, supply and demand and family income levels.




The
      title
      insurance business tends to be seasonal as well as cyclical.  Historically,
      the winter months have the least real estate activity because fewer real estate
      transactions occur, while the remaining quarters are more active. Refinance
      activity is generally less seasonal, but it is subject to interest rate
      fluctuations.




8




Exchange
      Services




Seasonal and
      other
      factors affecting the level of real estate activity and the volume of title
      premiums written will also generally  affect
      the demand for exchange services.





MARKETING





Title
      Insurance




The
      Company markets its title insurance services to a broad range of customers
      in
      the residential and commercial market sectors of the real estate industry.
      Issuing agents are typically real estate attorneys or subsidiaries of community
      and regional mortgage lending institutions, depending on local customs and
      regulations and the Company’s marketing strategy in a particular territory.





ITIC
      and
      NE-ITIC strive to provide superior service to their customers and consider
      this
      an important factor in attracting and retaining customers. Branch and corporate
      personnel strive to develop new business and agency relationships to increase
      market share and ITIC's Commercial Services Division provides services to
      commercial clients.





Exchange
      Services





Marketing
      of tax-deferred
      exchange services offered by ITEC and ITAC has been incorporated into the
      marketing of the core title products offered by ITIC and NE-ITIC. The Commercial
      Services Division of ITIC also markets the services offered by ITEC and ITAC
      to
      its commercial  clients.





REGULATION





Title
      Insurance





The
      Company is an insurance holding company and therefore it is subject to
      regulation in the states in which its insurance subsidiaries do business. These
      regulations, among other things, require insurance holding companies to register
      and file certain reports and require prior regulatory approval of the payment
      of
      dividends and other intercompany distributions or transfers.





Title
      insurance companies are extensively regulated under applicable state laws.
      All
      states have requirements for admission to do business as an insurance company,
      including minimum levels of capital and surplus and establishing reserves.
      State
      regulatory authorities monitor the stability and service of insurance companies
      and possess broad powers with respect to the licensing of title insurers and
      agents, approving rate schedules and policy forms, financial reporting and
      accounting practices, reserve requirements, investments  and
      dividend restrictions, as well as examinations and audits of title insurers.
      Both ITIC and NE-ITIC meet the statutory premium reserve requirements and the
      minimum capital and surplus requirements of the states in which they are
      licensed .
      A
      substantial portion of the assets of the Company’s title insurance subsidiaries
      consists of their portfolios of investment securities. Both of these
      subsidiaries are required by various states’ laws to maintain assets of a
      defined quality and amount.





The
      Company's two insurance subsidiaries are subject to examination at any time
      by
      the insurance regulators in the states where they are licensed. These
      and
      o ther
      governmental authorities have the power to enforce state and federal laws to
      which the title insurance subsidiaries are subject, including but
      not
      limited to,  the
      Real
      Estate Settlement Procedures Act.




9


ITIC
        is
        domiciled in North Carolina and is subject to North Carolina insurance
        regulations and other states where it does business. The North Carolina
        Department of Insurance typically schedules financial examinations every
        five
        years. ITIC was last examined by the North Carolina Department of Insurance
        for
        the period January 1, 2000 through December 31, 2004. No material deficiencies
        were noted in the report. NE-ITIC is domiciled in South Carolina and subject
        to
        South Carolina insurance regulations. The South Carolina Department of Insurance
        periodically schedules financial examinations. NE-ITIC was examined by the
        South
        Carolina Department of Insurance for the period January 1, 2000 through December
        31, 2005. No material deficiencies were noted.
 
 In
        addition to financial examinations, ITIC and NE-ITIC are subject to market
        conduct examinations by the North Carolina Department of Insurance and the
        South
        Carolina Department of Insurance, respectively. These audits examine domiciled
        state activity. ITIC's last market conduct examination commenced in May 2004
        for
        the period January 1, 2001 through December 31, 2003, with no material
        deficiencies noted. NE-ITIC's last market conduct examination commenced in
        November 2001 for the period January 1, 1998 through December 31, 2000, with
        no
        material deficiencies noted by the market conduct
        examiners.


The
      United States Department of Housing and Urban Development (“HUD”) continues to
      indicate that it would like to make modifications to the Real Estate Settlement
      Procedures Act (“RESPA”) and associated regulations. HUD published proposed
      rules regarding RESPA for public comment on March 14, 2008 with a 60 day
      comment period that expires on May 13, 2008.  According
      to HUD, the proposed rules are intended to improve disclosure of the loan terms
      and closing costs consumers pay when purchasing or refinancing their home.
      HUD
      has also indicated that it intends to seek legislative changes to RESPA that
      will complement the rules and provide HUD with enforcement mechanisms for some
      of the most important consumer disclosures and protections.In
      April 2007, the Government Accountability Office (“GAO”) released a report on
      the title insurance industry in which it recommended that HUD and state
      insurance regulators take actions to improve consumers’ ability to comparison
      shop for title insurance and strengthen the regulation and oversight of the
      title insurance market, among other measures. Based on the information known
      to
      management at this time, it is not possible to predict the outcome of any of
      the
      GAO recommendations for the title insurance industry’s market and other matters,
      or the market’s response to them. However, any material change in the Company’s
      regulatory environment may have an adverse effect on its business.





Proposals
      to change the laws and regulations governing insurance holding companies and
      the
      title insurance industry are often introduced in Congress, in the state
      legislatures and before the various insurance regulatory agencies. The Company
      regularly monitors such proposals and legislation, although the likelihood
      and
      timing of them and the impact they may have on the Company and its subsidiaries
      cannot be determined at this time.




Exchange
      Services





Intermediary
      services are not federally regulated by any regulatory commissions, and neither
      ITEC or ITAC operate in any states that regulate this industry. ITEC and ITAC
      both provide services to taxpayers pursuant to Internal Revenue Service (“IRS”)
      regulations that provide taxpayers a safe harbor by using a qualified
      intermediary to structure tax-deferred exchanges of property and using an
      exchange accommodation titleholder to hold property in reverse exchange
      transactions. Periodically, changes to the tax code are proposed containing
      provisions that impact like-kind exchanges .
      In
      2006, the IRS proposed new regulations which, if adopted, may negatively affect
      the ability of qualified intermediaries to retain a portion of the interest
      earned on exchange funds held during exchange transactions. If passed as
      proposed, these regulations would materially adversely impact the exchange
      services segment and the Company’s net income. Refer to Item 7. Management’s
      Discussion and Analysis of Financial Condition and Results of Operations in
      the
      2007 Annual Report to Shareholders incorporated by reference in this Form 10-K
      Annual Report for information regarding IRS regulations.




10





Investment
      Management and Trust Services





Investors
      Trust Company is regulated by the North Carolina Commissioner of Banks.
      Investors Trust Company was last examined by the North Carolina Commissioner
      of
      Banks for the period ended December 31, 2006. No
      material deficiencies were noted in the Report of Examination.





COMPETITION





Title
      Insurance





The
      title
      insurance industry is highly competitive. ITIC's and NE-ITIC's major competitors
      together comprise a majority of the title insurance market on a national level.
      The number and size of competing companies varies in the different geographic
      areas in which the Company conducts business. Key factors that affect
      competition in the title insurance industry are timeliness
      and quality of service, price, expertise and the financial strength and size
      of
      the insurer. Title insurance underwriters also compete for agents based upon
      service and commission levels .
      Some
      title insurers currently have greater financial resources, larger distribution
      networks and more extensive computerized databases of property records and
      related information than the Company.





In
      addition, there are numerous industry-related regulations and statutes that
      set
      out conditions and requirements to conduct business. Changes to or the removal
      of such regulations and statutes could result in additional competition from
      alternative title insurance products or new entrants into the industry that
      could materially affect the Company's business operations and financial
      condition.





Exchange
      Services




Competition
      for ITEC and ITAC comes from other title insurance companies and agents, banks,
      attorneys, and other independently-owned qualified intermediaries that offer
      exchange services. Key elements that affect competition are price, expertise,
      timeliness and quality of service and the financial strength and size of the
      company. Exchange services are not a regulated industry; there is no market
      data
      available regarding the Company's market position in this industry.





CUSTOMERS





The
      Company is not dependent upon any single customer or a few customers, and the
      loss of any single customer would not have a material adverse effect on the
      Company.




11


INVESTMENT
      POLICIES





The
      Company and its subsidiaries derive a substantial portion of their income from
      investments in bonds (municipal and corporate) and equity securities. The
      investment policy is designed to maintain a high quality portfolio and maximize
      income. The Company invests primarily in short-term investments, federal and
      municipal governmental securities and investment grade debt securities and
      equity securities. Some state laws impose restrictions upon the types and
      amounts of investments that can be made by the Company's insurance subsidiaries.
      The Company manages its investment portfolio and does not utilize third party
      investment managers. The securities in the Company’s portfolio are subject to
      economic conditions and normal market risks.




See
      Note
      3 of Notes to Consolidated Financial Statements in the 2007
      Annual Report to Shareholders incorporated by reference in this Form 10-K Annual
      Report for the major categories of investments, scheduled maturities, amortized
      cost, market values of investment securities and earnings by
      category.





ENVIRONMENTAL
      MATTERS





The
      title
      insurance policies ITIC and NE-ITIC currently issue exclude any  liability
      for environmental risks and contamination. Although policies issued prior to
      1992 may not specifically exclude such environmental risks, they generally
      do
      not provide affirmative coverage for such risks. As a result, the Company
      has not experienced and does not anticipate that it or its subsidiaries will
      incur any significant expenses related to environmental claims.





In
      connection with effecting tax-deferred exchanges of like-kind property, ITEC
      and
      ITAC may temporarily hold title to property pursuant to an accommodation
      titleholder agreement. In such situations, the person or entity for which title
      is being held must execute an indemnification agreement pursuant to which it
      agrees to indemnify ITEC or ITAC, as appropriate, for any environmental or
      other
      claims which may arise as a result of the arrangement.





EMPLOYEES





The
      Company has no paid employees. Officers of the Company are full-time paid
      employees of ITIC. The Company’s subsidiaries had 227 full-time employees and 27
      part-time employees as of December 31, 2007. None of the employees are covered
      by any collective bargaining agreements. Management considers its relationship
      with its employees to be favorable.





ADDITIONAL
      INFORMATION





The
      Company’s internet address is www.invtitle.com ,
      the
      contents of which are not and shall not be deemed a part of this document or
      any
      other U.S. Securities and Exchange filing. The Company makes available free
      of
      charge through its
      Internet website its annual reports on Form 10-K, its quarterly reports on
      Form
      10-Q, its current reports on Form 8-K, and all amendments to those reports
      filed
      or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange
      Act
      of 1934 as soon as reasonably practicable after such materials are
      electronically filed with, or furnished to, the Securities and Exchange
      Commission (“SEC”). The
      information is free of charge and may be reviewed and downloaded from the
      website at any time. The
      public may read any material it has filed with the SEC at the SEC’s Public
      Reference Room at 100 F. Street, N.E., Washington, D.C. 20549. The Investors
      section of the Company’s website also includes its corporate governance
      guidelines and code of ethics.




12





**ITEM
      1A. RISK FACTORS**





The
      risk
      factors listed in this section and other factors noted herein or incorporated
      by
      reference could cause actual results to differ materially from those contained
      in any forward-looking statements.





**The
      Company’s results of operations and financial condition are susceptible to the
      changing level of demand for title insurance.**





The
      demand for the Company’s title insurance and other real estate transaction
      products and services varies over time and from year to year and is dependent
      upon, among other things, the volume of commercial and residential real estate
      transactions and mortgage refinancing transactions. The volume of these
      transactions has historically been influenced by factors such as the state
      of
      the overall economy and mortgage interest rates. When
      mortgage interest rates are increasing or during an economic downturn or
      recession, real estate activity typically declines and the title insurance
      industry tends to experience lower revenues and profitability. Both the volume
      and the average price of residential real estate transactions have recently
      experienced declines in many parts of the country, and these trends appear
      likely to continue. Volume is a key factor in the Company’s profitability due to
      the existence of fixed costs such as personnel and occupancy expenses associated
      with the support of the issuance of the insurance policy and of general
      corporate operations.  The
      overall demand for title insurance also depends in part upon the requirement
      by
      mortgage lenders and participants in the secondary mortgage market that title
      insurance policies be obtained on residential and commercial real property.





**The
      Company may experience losses resulting from fraud, defalcation or misconduct.**





Fraud,
      defalcation, regulatory noncompliance and other misconduct by the Company’s
      agents, approved attorneys and employees are risks inherent in the Company’s
      business. Agents and approved attorneys typically handle large sums of money
      in
      trust pursuant to the closing of real estate transactions and misappropriation
      of funds by any of these parties could result in large title
      claims.





**Differences
      between actual claims experience and underwriting and reserving assumptions
      may
      adversely affect the Company’s financial results.**





The
      Company’s net income is affected by the extent to which its actual claims
      experience is consistent with the assumptions used in establishing reserves
      for
      claims. Reserves for claims are established based on actuarial  estimates
      of how much the Company will need to pay for reported as well as incurred,
      but
      not yet reported claims. In addition, management considers factors such as
      the
      Company’s historical claims experience, case reserve estimates on reported
      claims, large claims and other relevant factors in determining loss provision
      rates and the aggregate recorded expected liability for claims. Due to the
      nature of the underlying risks and the high degree of uncertainty associated
      with the determination of reserves for claims, the Company cannot determine
      precisely the amounts which it will ultimately pay to settle its claims. Such
      amounts may vary from the estimated amounts, particularly when those payments
      may not occur until well into the future. To the extent that actual claims
      experience is less favorable than the underlying assumptions used in
      establishing such liabilities, the Company could be required to increase
      reserves. Title claims can often be complex, vary greatly in dollar amounts
      and
      are affected by economic and market conditions and may involve uncertainties
      as
      to ultimate exposure, and therefore, reserve estimates are subject to
      variability.  In
      addition, the Company may experience unexpected large losses periodically which
      require it to increase its title loss reserves.




13





**Regulatory** **scrutiny** **** **of
      the industry and potential changes to RESPA could result in financial losses
      or
      otherwise impact the manner the Company conducts business.**





The
      title
      insurance industry has recently been under regulatory scrutiny in a number
      of
      states with respect to pricing practices, possible Real Estate Settlement
      Procedures Act (“RESPA”) violations and unlawful rebating practices. The
      regulatory investigations have resulted in settlements and fines for some title
      insurance underwriters. In 2007, the Government Accountability Office released
      a
      report in response to a request from the House of Representatives Committee on
      Financial Services regarding the title industry. The United States Department
      of
      Housing and Urban Development (“HUD”) is responsible for enforcing RESPA. HUD
      continues to indicate that it would like to make modifications to RESPA and
      associated regulations which would result in changes to the existing industry
      regulatory framework that could have a material impact on the Company’s
      marketing and operations. The Company is periodically involved in litigation
      arising in the ordinary course of business.





**The
      Company’s non-insurance subsidiaries are also subject to state and federal
      regulations.**





Some
      of
      the Company’s other businesses operate within state and federal guidelines. Any
      changes in the applicable regulatory environment or changes in existing
      regulations could restrict its existing or future operations. Revenues from
      the
      Company’s exchange services segment are closely related to the tax rate on
      capital gains and other provisions in the
      Internal Revenue Code. The Company’s revenues in future periods will continue to
      be subject to these and other factors which are beyond its control. In February
      2006, the IRS proposed new regulations which, if adopted, may negatively affect
      the ability of qualified intermediaries to retain interest earned on exchange
      funds they are holding. If passed as proposed, these regulations would
      materially adversely impact the exchange services segment and the Company’s net
      income, since a significant portion of the exchange segment’s revenues are based
      on retaining a portion of the interest income earned on deposits held by the
      Company. In
      March
      2007, the IRS issued a revised regulatory flexibility analysis and requested
      more specific information to help in determining the impact the rules would
      have
      on small businesses. The proposed regulations have still not been finalized.





In
      addition, the investment management and trust services division is regulated
      by
      the North Carolina Commissioner of Banks.





**The
      Company’s insurance subsidiaries are subject to complex government
      regulations.**





The
      Company’s title insurance businesses are subject to extensive state
      laws and regulations by state insurance authorities in each state in which
      they
      operate. These laws and regulations are primarily intended for the protection
      of
      policyholders and consumers. The nature and extent of these laws and regulations
      typically involve, among other matters, licensing and renewal requirements
      and
      trade and marketing practices, including,
      but not limited to:





·
            licensing
                of insurers and agents;


·
            approval
                of premium rates for insurance;


·
            limitations
                on types and amounts of
                investments;


·
            restrictions
                on the size of risks that may be insured by a single
                company;


·
            deposits
                of securities for the benefit of policy
                holders;


·
            filing
                of annual and other reports with respect to financial
                condition;


·
            approval
                of policy forms; and


·
            regulation
                regarding the use of personal
                information.






These
      laws and regulations are subject to change and may
      restrict the Company’s ability to implement rate increases or other actions that
      it may want to take to enhance its operating results or have a negative impact
      on its ability to generate revenue and earnings.




14




**Competition
      in the Company’s business affects its revenues** .





The
      title
      insurance industry is highly competitive. Key factors that affect competition
      in
      the title insurance business are quality of service, price within
      regulatory parameters, expertise, timeliness and the financial strength and
      size
      of the insurer. Title companies compete for premiums by choosing various
      distribution channels which may include company-owned operations and issuing
      agency relationships with attorneys, lenders, realtors, builders and other
      settlement service providers. Title insurance underwriters compete for agents
      on
      the basis of service and commission levels. Some title insurers currently have
      greater financial resources, larger distribution networks and more extensive
      computerized databases of property records and information than the Company.
      The
      number and size of competing companies varies in the different geographic areas
      in which the Company operates .
      Competition among the providers of title insurance, new entrants to the industry
      or the acceptance of new alternatives to traditional title products by the
      marketplace could adversely affect the Company’s operations and financial
      condition.





**The
      Company’s success relies on its ability to attract and retain key personnel and
      agents.**





Competition
      for skilled and experienced personnel and agents in the Company’s industry is
      high. The Company may have difficulty hiring the necessary marketing and
      management personnel to support any future growth. The loss of any key employee
      or the failure of any key employee to perform in their current position could
      prevent the Company from realizing future growth. Also, the Company cannot
      provide assurance that it will succeed in attracting or retaining new agents.
      Its results of operations and financial condition could be adversely affected
      if
      it is unsuccessful in attracting and retaining agents.





**A
      downgrade or a potential downgrade in one of the Company’s financial strength
      ratings could result in a loss of business.**





The
      competitive positions of insurance companies rely in part on the independent
      ratings of their financial strength and claims-paying ability. The
      Company’s financial strength is subject to continued periodic review by rating
      agencies. A
      significant downgrade in the ratings of either of the Company’s policy-issuing
      subsidiaries could negatively impact its ability to compete for new business
      and
      retain existing business and
      maintain licenses necessary to
      operate as title insurance companies in various states.





**A
      decline in the performance of the Company’s investments could materially
      adversely affect net income and cash flows.**





Changes
      in general economic conditions,  interest
      rates, activities in securities markets and other external factors could
      adversely affect the value of the Company’s investment portfolio  and,
      in
      turn, the Company’s operating results and financial condition.




15





**Insurance
      regulations limit the ability of the Company’s insurance subsidiaries to pay
      dividends to it** .





The
      Company is an insurance holding company and has no substantial operations of
      its
      own. The Company’s ability to pay dividends and meet its obligations is
      dependent , among
      other things , on the
      ability of its subsidiaries to pay dividends or repay funds to it. The Company’s
      insurance subsidiaries are subject to insurance and other regulations that
      limit
      the amount of dividends, loans or advances to it based on the amount of adjusted
      unassigned surplus and net income and require these subsidiaries to maintain
      minimum amounts of capital, surplus and reserves. In general, dividends in
      excess of prescribed limits are deemed “extraordinary” and require prior state  insurance
      regulatory approval.





These
      dividend restrictions could limit the Company’s ability to pay dividends to its
      shareholders or grow its business. As of December 31, 2007 , approximately
      $ 63,219,000  of
      the
      consolidated stockholders' equity represented net assets of the Company’s
      subsidiaries that cannot be transferred in the form of dividends, loans or
      advances to the parent company under statutory regulations without prior
      insurance department approval. For further discussion of the regulation of
      dividend payments and other transactions between affiliates, see “Liquidity and
      Capital Resources” under Management’s Discussion and Analysis in Item 7 of this
      report.





**The
      Company may encounter difficulties managing growth or rapid technology changes,
      which could adversely affect its results.**





The
      Company has historically achieved revenue growth in part through a combination
      of developing related new products or services and increasing its market share
      for existing products. A portion of the Company’s growth may be in services or
      geographic areas with which management is less familiar than with its core
      business and geographic areas. The expansion of the Company’s business,
      particularly in new services or geographic areas, or significant changes in
      technology may subject it to associated risks, such as the diversion of
      management’s attention, lack of substantial experience in operating such
      businesses and a change in competitive position resulting
      from rapid technology changes.





**The
      Company relies upon North Carolina for about 50% of its title insurance
      premiums.**





North
      Carolina is the largest source of revenue for the title insurance segment and,
      in 2007, North Carolina-based premiums accounted for approximately 50% of
      premiums earned by the Company. A decrease in North Carolina business would
      negatively impact financial results.





**Key
      accounting and information systems are concentrated in a few locations.**





The
      Company’s corporate headquarters, accounting and technology operations are
      concentrated in North Carolina. These critical business operations are subject
      to interruption by natural disasters, fire, power shortages and other events
      beyond the Company’s control. A catastrophic event that results in the
      destruction or disruption of any of the Company’s critical business operations
      or systems could severely affect its ability to conduct normal business
      operations and, as a result, there could be a material and adverse effect on
      the
      Company’s business, operating results and financial condition.




16





**Certain
      provisions of the Company’s shareholder rights plan may make a takeover of the
      Company difficult.**





The
      Company has a shareholders rights plan which could discourage transactions
      involving actual or potential changes of control, including transactions that
      otherwise could involve payment of a premium over prevailing market prices
      to
      the Company’s shareholders for their common shares.





**ITEM
      1B. UNRESOLVED STAFF COMMENTS**




None




17


**ITEM
      2. PROPERTIES**





The
      Company owns two adjacent office buildings and property located on the corner
      of
      North Columbia and West Rosemary Streets in Chapel Hill, North Carolina, which
      serve as the Company's corporate headquarters. The main building contains
      approximately 23,000 square feet and has on-site parking facilities. The
      Company's principal subsidiary, ITIC, leases office space in 32 locations
      throughout North Carolina, South Carolina, Michigan and Nebraska. NE-ITIC leases
      office space in one location in New York. Each of the office facilities occupied
      by the Company and its subsidiaries are in good condition and adequate for
      present operations. In November 2005, the Company purchased approximately 7,000
      square feet of additional office space in Chapel Hill, North Carolina that
      was
      previously leased for ITEC, ITAC, ITIC’s Commercial Services Division and ITIC’s
      Settlement Services Division.





**ITEM
      3. LEGAL PROCEEDINGS**





The
      Company and its subsidiaries are involved in various legal proceedings that
      are
      incidental to their business. In the Company's opinion, based on the present
      status of these proceedings, any potential liability of the Company or its
      subsidiaries with respect to these legal proceedings will not, in the aggregate,
      be material to the Company's consolidated financial condition or results of
      operations.





**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
      HOLDERS**





No
      matters were submitted to a vote of security holders during the fourth quarter
      of the fiscal year ended December 31, 2007.





**EXECUTIVE
      OFFICERS OF THE COMPANY** ****





Following
      is information regarding the executive officers of the Company as of March
      14,
      2008. Each officer is appointed at the annual meeting of the Board of Directors
      to serve until the next annual meeting of the Board or until his or her
      respective successor has been elected and qualified.




Name
            
            Age
            
            Position
                with RegistrantJ.
                Allen Fine
            
            73
            
            Chief
                Executive Officer and Chairman of the BoardJames
                A. Fine, Jr.
            
            45
            
            President,
                Treasurer, Chief Financial Officer, Chief Accounting Officer and
                DirectorW.
                Morris Fine
            
            41
            
            Executive
                Vice President, Secretary and
                Director




J.
      Allen Fine has been
      Chief Executive Officer and Chairman of the Board of the Company since its
      incorporation in 1973. Mr. Fine also served as President of the Company until
      May 1997. Mr. Fine is the father of James A. Fine, Jr., President, Treasurer,
      Chief Financial Officer, Chief Accounting Officer, and Director of the
      Company, and W. Morris Fine, Executive Vice President, Secretary and Director
      of
      the Company.




18





James
      A. Fine, Jr. was
      named Vice President of the Company in 1987. In 1997, he was named President
      and
      Treasurer and appointed as a Director of the Company. In 2002, he was appointed
      as Chief Financial Officer and Chief Accounting Officer. He is the son of J.
      Allen Fine, Chief Executive Officer and Chairman of the Board of the Company,
      and the brother of W. Morris Fine, Executive Vice President, Secretary and
      Director of the Company.





W.
      Morris Fine was
      named Vice President of the Company in 1992. In 1993, he was named Treasurer
      of
      the Company and served in that capacity until 1997. In 1997, he was named
      Executive Vice President and Secretary of the Company. In 1999, he was appointed
      as a Director of the Company. W. Morris Fine is the son of J. Allen Fine, Chief
      Executive Officer and Chairman of the Board of the Company, and the brother
      of
      James A. Fine, Jr., President, Treasurer, Chief Financial Officer, Chief
      Accounting Officer, and Director of the Company.




19




**PART
      II**





**ITEM
      5. MARKET FOR REGISTRANT'S COMMON EQUITY; RELATED STOCKHOLDER MATTERS****AND
      ISSUER PURCHASES OF EQUITY SECURITIES**





The
      high
      and low sales prices for the Company's common stock, as reported on the NASDAQ
      National Market System, the dividends paid per common share for each quarter
      in
      the last two fiscal years and the approximate number of shareholders of record
      are set forth under the caption "Common Stock Data" in the 2007 Annual Report
      to
      Shareholders and are incorporated by reference in this Form 10-K Annual Report.
      For a discussion of factors that may limit the Company's ability to pay
      dividends on its common stock, refer to the subsection of Item 7. Management's
      Discussion and Analysis of Financial Condition and Results of Operations
      entitled "Liquidity and Capital Resources" in the 2007 Annual Report to
      Shareholders, incorporated by reference in this Form 10-K Annual Report.
      Additional information required by this item is incorporated by reference in
      the
      2007 Annual Report to Shareholders.




The
      following table provides information about purchases by the Company (and all
      affiliated purchasers) during the quarter ended December 31, 2007 of equity
      securities that are registered by the Company pursuant to Section 12 of the
      Exchange Act:





Issuer
      Purchases of Equity Securities


**Period**
              
              **Total**
                **Number of**
                **Shares**
                **Purchased**
              
              **Average Price**
                ******Paid per Share**
              
              **Total Number of**
                **Shares Purchased as
                  Part of Publicly**
                **Announced Plan**
              
              **Maximum Number of
                  Shares that May Yet Be
                  Purchased Under the****Plan**Beginning
                  of period
              
              
              
              
              
              
              
              
              
              
              
              307,34510/01/07 –
                  10/31/07
              
              
              9,031
              
              $
              39.12
              
              
              9,031
              
              
              298,31411/01/07
                  – 11/30/07
              
              
              1,526
              
              
              39.18
              
              
              1,526
              
              
              296,78812/01/07
                  – 12/31/07
              
              
              61,452
              
              
              38.03
              
              
              61,452
              
              
              235,336Total:
              
              
              **72,009**
              
              **$**
              **38.19**
              
              
              **72,009**
              
              
              **235,336**




For
      the
      quarter ended December 31, 2007, the Company purchased an aggregate of 72,009
      shares of the Company’s common stock pursuant to the purchase plan (the “Plan”)
      that was publicly announced on June 5, 2000. The Board of Directors of the
      Company approved the purchase of up to an aggregate of 500,000 and 125,000
      shares, respectively, of the Company’s common stock pursuant to the Plan. Unless
      terminated earlier by resolution of the Board of Directors, the Plan will expire
      when all shares authorized for purchase under the Plan have been purchased. The
      Company intends to make further purchases under this Plan.




20





**ITEM
      6. SELECTED FINANCIAL DATA**





The
      selected financial data for the last five fiscal years of the Company and its
      subsidiaries is set forth under the caption "Financial Highlights" in the 2007
      Annual Report to Shareholders and is incorporated by reference in this Form
      10-K
      Annual Report. The information should be read in conjunction with the
      Consolidated Financial Statements, Notes to Consolidated Financial Statements
      and Management's Discussion and Analysis of Financial Condition and Results
      of
      Operations in the 2007 Annual Report to Shareholders, which are incorporated
      by
      reference in this Form 10-K Annual Report.





**ITEM
      7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
      AND RESULTS OF OPERATIONS**





Management's
      Discussion and Analysis of Financial Condition and Results of Operations in
      the
      2007 Annual Report to Shareholders is incorporated by reference in this Form
      10-K Annual Report.





**ITEM
      7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK******





The
      subsection entitled "Quantitative and Qualitative Disclosures about Market
      Risk"
      in Management's Discussion and Analysis of Financial Condition and Results
      of
      Operations in the 2007 Annual Report to Shareholders is incorporated by
      reference in this Form 10-K Annual Report.




**ITEM
      8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
      DATA**





The
      financial statements and supplementary data in the 2007 Annual Report to
      Shareholders are incorporated by reference in this Form 10-K Annual
      Report.





The
      financial statements meeting the requirements of Regulation S-X are attached
      hereto as Schedules I, II, III, IV and V.





The
      supplementary financial information set forth in the section entitled "Selected
      Quarterly Financial Data" in Management's Discussion and Analysis of Financial
      Condition and Results of Operations in the 2007 Annual Report to Shareholders
      is
      incorporated by reference in this Form 10-K Annual Report.





**ITEM
      9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
      AND FINANCIAL DISCLOSURE**





None.




21


**ITEM
      9A. CONTROLS AND PROCEDURES**





**DISCLOSURE
      CONTROLS AND PROCEDURES**





An
      evaluation was performed by the Company's management, including its Chief
      Executive Officer and Chief Financial Officer, of the effectiveness of the
      design and operation of the Company's disclosure controls and procedures. Based
      on that evaluation, the Company's Chief Executive Officer and Chief Financial
      Officer concluded that the Company's disclosure controls and procedures were
      effective as of December 31, 2007 for the purpose of providing reasonable
      assurance that the information required to be disclosed in the reports the
      Company files or submits under the Securities Exchange Act of 1934 (the “Act”)
      (i) is recorded, processed, summarized and reported within the time periods
      specified in the SEC’s rules and forms and (ii) is accumulated and communicated
      to the Company's management, including its Chief Executive Officer and Chief
      Financial Officer, as appropriate to allow timely decisions regarding required
      disclosures.





**INTERNAL
      CONTROL OVER FINANCIAL REPORTING**





(a)  Management’s
      report on internal control over financial reporting.


The
      Company’s management’s report on internal financial reporting is set forth in
      the Company’s 2007 Annual Report under the heading “Management’s Report on
      Internal Control over Financial Reporting” and is incorporated herein by
      reference.





(b)  Attestation
      report of the registered public accounting firm.


The
      report of Dixon Hughes PLLC, the Company’s independent registered public
      accounting firm, on the effectiveness of the Company’s internal control over
      financial reporting is set forth in the Company’s 2007 Annual Report under the
      heading “Report of Independent Registered Public Accounting Firm on Internal
      Control” and is incorporated herein by reference.





(c)  During
      the quarter ended December 31, 2007, there were no changes in the Company's
      internal control over financial reporting that has materially affected, or
      is
      reasonably likely to materially affect, the Company's internal control over
      financial reporting. However, in the process of preparing the Annual Report
      on
      Form 10-K, management identified certain issues with respect to the Company’s
      internal control over financial reporting and has remediated those issues.
      In
      particular, management discovered certain understatements in the provision
      for
      income taxes in the Company’s financial statements in certain periodic filings.
      These errors were due to a misclassification of certain taxable municipal bonds
      that the Company’s custodian had reported as tax-exempt in its tax reports to
      the Company and were determined to be immaterial to the affected reporting
      periods. The Company has corrected these errors for all affected periods in
      its
      Consolidated Financial Statements for the year ended December 31, 2007.
      Management has discussed these matters with the Audit Committee of the Company’s
      Board of Directors and the Company’s auditors, and the Company has made
      corrective changes to its internal control procedures to improve the
      effectiveness of its internal control over financial reporting and to reduce
      the
      likelihood of similar errors occurring in the future. The Company has
      implemented a review process of the Company’s custodian statements to ensure
      investments are categorized appropriately for tax purposes.




22





**ITEM
      9B. OTHER INFORMATION**





There
      was
      no information required to be disclosed in a report on Form 8-K during the
      fourth quarter of the year that has not been reported.




23


**PART
      III**





**ITEM
      10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE**




The
      information called for by this item is incorporated by reference to the material
      under the captions “Proposal Requiring Your Vote,” “ General
      Information -  Section
      16(a) Beneficial Ownership Reporting Compliance,” “Corporate Governance - Board
      of Directors and Committees -
      T he
      Audit
      Committee ” and
“Corporate Governance - Code of Business Conduct and Ethics” in the Company's
      definitive Proxy Statement for the Annual Meeting of Shareholders to be held
      on
      May 21, 2008. Other information with respect to the executive officers of the
      Company is included at the end of Part I of this Form 10-K Annual Report under
      the separate caption "Executive Officers of the Company.”




**ITEM
      11. EXECUTIVE COMPENSATION**





The
      information called for by this item is set forth under the captions “Executive
      Compensation,” “Compensation of Directors,” “Corporate Governance - Compensation
      Committee Interlocks and Insider Participation” and “Compensation Committee
      Report” in the Company's definitive Proxy Statement relating to the Annual
      Meeting of Shareholders to be held on May 21, 2008 and is incorporated by
      reference in this Form 10-K Annual Report.





**ITEM
      12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
      MANAGEMENT AND RELATED STOCKHOLDER MATTERS**





The
      information pertaining to securities ownership of certain beneficial owners
      and
      management is set forth under the caption “Stock Ownership of Certain Beneficial
      Owners and
      Management ”
in
      the
      Company's definitive Proxy Statement relating to the Annual Meeting of
      Shareholders to be held on May 21, 2008 and is incorporated by reference in
      this
      Form 10-K Annual Report.





The
      following table provides information about the Company’s compensation plans
      under which equity securities are authorized for issuance as of December 31,
      2007. The Company does not have any equity compensation plans that have not
      been
      approved by its shareholders.





**Equity
      Compensation Plan Information**





**Plan
                Category**
            
            **Number of Securities to**
              **be Issued Upon**
              **Exercise of**
              **Outstanding Options,**
              **Warrants and Rights**
            
            **Weighted****-Average**
              **Exercise****Price of**
              **Outstanding Options,**
              **Warrants and Rights**
            
            **Number of Securities**
              **Remaining Available**
              **for Future Issuance**
              **Under Equity**
              **Compensation Plans**Equity
                compensation plans approved by shareholders
            
            
            60,480
            
            $
            22.77
            
            
            236,651Equity
                compensation plans not approved by shareholders
            
            
            -
            
            
            -
            
            
            -Total
            
            
            60,480
            
            $
            22.77
            
            
            236,651





24





**ITEM
      13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS****,
      AND DIRECTOR INDEPENDENCE**





The
      information called for by this item is set forth under the captions “Certain
      Relationships and Related Transactions” and “Corporate Governance - Independent
      Directors” set forth in the Company's definitive Proxy Statement relating to the
      Annual Meeting of Shareholders to be held on May 21, 2008 and is incorporated
      by
      reference in this Form 10-K Annual Report.





**ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND
      SERVICES**





The
      information pertaining to principal accountant fees and services is set forth
      under the caption “Independent Registered Public Accounting Firm” in the
      Company's definitive Proxy Statement relating to the Annual Meeting of
      Shareholders to be held on May 21, 2008 and is incorporated by reference in
      this
      Form 10-K Annual Report.




25




**PART
      IV**





**ITEM
      15. EXHIBITS AND FINANCIAL STATEMENT
      SCHEDULES**




(a)(1) Financial
      Statements .





The
      following financial statements in the 2007 Annual Report to Shareholders are
      hereby incorporated by reference in this Form 10-K Annual Report:




Consolidated
                  Balance Sheets as of December 31, 2007 and 2006Consolidated
                  Statements of Income for the Years Ended December 31, 2007, 2006
                  and
                  2005Consolidated
                  Statements of Stockholders' Equity for the Years Ended December
                  31, 2007,
                  2006 and 2005Consolidated
                  Statements of Comprehensive Income for the Years Ended December
                  31, 2007,
                  2006 and 2005Consolidated
                  Statements of Cash Flows for the Years Ended December 31, 2007,
                  2006 and
                  2005Notes
                  to Consolidated Financial StatementsReport
                  of Independent Registered Public Accounting FirmManagement’s
                  Report on Internal Control over Financial ReportingReport
                  of Independent Registered Public Accounting Firm on Internal
                  Control




(a)(2) Financial
      Statement Schedules .





Following
      is a list of financial statement schedules filed as part of this Form 10-K
      Annual Report:





Schedule
                Number
            
            DescriptionI
            
            Summary
                of Investments - Other Than Investments in Related
                PartiesII
            
            Condensed
                Financial Information of RegistrantIII
            
            Supplementary
                Insurance InformationIV
            
            ReinsuranceV
            
            Valuation
                and Qualifying Accounts




All
      other
      schedules are omitted, as the required information either is not applicable,
      is
      not required, or is presented in the consolidated financial statements or the
      notes thereto.





(a)(3) Exhibits .




The
      exhibits filed as a part of this report and incorporated herein by reference
      to
      other documents are listed in the Index to Exhibits to this Annual Report on
      Form 10-K.




26


**SIGNATURES**





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized.





**INVESTORS
                TITLE COMPANY**(Registrant)By:
            /s/
                J. Allen FineJ.
                Allen Fine, Chairman and Chief ExecutiveOfficer
                (Principal Executive Officer)





March
      17,
      2008





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following persons on behalf of the Registrant and in the
      capacities indicated on the 17th day of March, 2008.




/s/ J. Allen Fine
            
            /s/
                James R. MortonJ.
                Allen Fine, Chairman of the Board and
            
            James
                R. Morton, DirectorChief
                Executive Officer*(Principal
                Executive Officer)*/s/ James A. Fine, Jr.
            
            /s/
                A. Scott Parker IIIJames
                A. Fine, Jr., President, Treasurer and
            
            A.
                Scott Parker III, DirectorDirector
                *(Principal Financial Officer and**Principal
                Accounting Officer)*/s/ W. Morris Fine
            
            /s/
                H. Joe King, Jr.W.
                Morris Fine, Executive Vice President,
            
            H.
                Joe King, Jr., DirectorSecretary
                and Director/s/ David L. Francis
            
            /s/
                R. Horace JohnsonDavid
                L. Francis, Director
            
            R.
                Horace Johnson, DirectorLoren
                B. Harrell, Jr., Director





27








**SCHEDULE
      I**





**INVESTORS
      TITLE COMPANY AND SUBSIDIARIES**


**SUMMARY
      OF INVESTMENTS - OTHER THAN INVESTMENTS IN RELATED PARTIES**


**As
      of December 31, 2007**








**Type of Investment**
            
            **Cost(1)**
            
            **Market Value**
            
            **Amount at**
              **which shown**
              **in the**
              **Balance Sheet (2)****Fixed
                Maturities:****Bonds:****States,
                  municipalities and politicalsubdivisions**
            
            $
            86,072,449
            
            $
            87,217,601
            
            $
            87,191,907**All
                other corporate bonds**
            
            
            4,208,096
            
            
            4,391,574
            
            
            4,391,574**Short-term
                investments**
            
            
            21,157,598
            
            
            21,157,598
            
            
            21,157,598**Certificates
                of deposit**
            
            
            64,935
            
            
            64,935
            
            
            64,935**Total
                fixed maturities**
            
            
            111,503,078
            
            
            112,831,708
            
            
            112,806,014**Equity
                Securities:****Common
                Stocks:****Public
                utilities**
            
            
            208,106
            
            
            553,482
            
            
            553,482**Banks,
                trust and insurance companies**
            
            
            34,884
            
            
            246,120
            
            
            246,120**Industrial,
                miscellaneous and all other**
            
            
            9,776,643
            
            
            13,270,068
            
            
            13,270,068**Nonredeemable
                preferred stocks**
            
            
            418,025
            
            
            516,396
            
            
            516,396**Total
                equity securities**
            
            
            10,437,658
            
            
            14,586,066
            
            
            14,586,066**Other
                Investments**
            
            
            1,634,301
            
            
            
            
            
            1,634,301**Total
                investments per the consolidated balance sheet**
            
            $
            123,575,037
            
            
            
            
            $
            129,026,381





(1)
            Fixed
                maturities are shown at amortized cost and equity securities are
                shown at
                original cost.


(2)
            Bonds
                of states, municipalities and political subdivisions are shown at
                amortized cost for held-to-maturity bondsand
                fair value for available-for-sale bonds. Equity securities are shown
                at
                fair value.










**SCHEDULE
      II**





**INVESTORS
      TITLE COMPANY (PARENT COMPANY)**


**CONDENSED
      FINANCIAL INFORMATION OF REGISTRANT**


**BALANCE
      SHEETS**


**AS
      OF DECEMBER 31, 2007 AND 2006**





**2007**
            
            **2006****Assets**Cash
                and cash equivalents
            
            $
            207,436
            
            $
            194,391Investments
                in fixed maturities, available-for-sale
            
            
            17,707,623
            
            
            19,951,713Investments
                in equity securities, available-for-sale
            
            
            250,950
            
            
            127,750Short-term
                investments
            
            
            13,122,076
            
            
            1,464,032Investments
                in affiliated companies
            
            
            63,628,499
            
            
            68,973,229Other
                investments
            
            
            461,835
            
            
            703,296Other
                receivables
            
            
            263,518
            
            
            410,018Income
                taxes receivable
            
            
            1,255,157
            
            
            876,666Accrued
                interest, dividends, and other assets
            
            
            241,941
            
            
            261,793Property,
                net
            
            
            3,038,964
            
            
            3,151,099Deferred
                income taxes, net
            
            
            22,288
            
            
            55,551**Total
                Assets**
            
            $
            100,200,287
            
            $
            96,169,538**Liabilities
                and Stockholders' Equity**
              ****Liabilities:****Accounts
                payable and accrued liabilities
            
            $
            924,447
            
            $
            893,875Total
                liabilities
            
            
            924,447
            
            
            893,875**Stockholders'
                Equity:**Class
                A Junior Participating preferred stock - no par value (shares authorized
                100,000; no shares issued)
            
            
            -
            
            
            -Common
                stock-no par (shares authorized 10,000,000; 2,411,318 and 2,507,325
                shares
                issued and outstanding 2007 and 2006, respectively, excluding 291,676
                shares for 2007 and 2006 of common stock held by the Company's
                subsidiary)
            
            
            1
            
            
            1Retained
                earnings
            
            
            95,739,827
            
            
            92,134,608Accumulated
                other comprehensive income
            
            
            3,536,012
            
            
            3,141,054Total
                stockholders' equity
            
            
            99,275,840
            
            
            95,275,663**Total
                Liabilities and Stockholders' Equity**
            
            $
            100,200,287
            
            $
            96,169,538










**SCHEDULE
      II**





**INVESTORS
      TITLE COMPANY (PARENT COMPANY)**


**CONDENSED
      FINANCIAL INFORMATION OF REGISTRANT**


**STATEMENTS
      OF INCOME**


**FOR
      THE YEARS ENDED DECEMBER 31, 2007, 2006 AND 2005**





**2007**
            
            **2006**
            
            **2005****Revenues:**Investment
                income-interest and dividends
            
            $
            1,146,168
            
            $
            561,400
            
            $
            280,145Net
                realized gain on sales of investments
            
            
            406,623
            
            
            -
            
            
            18,464Rental
                income
            
            
            736,713
            
            
            735,431
            
            
            553,222Miscellaneous
                income (loss)
            
            
            81,938
            
            
            (115,883
            )
            
            70,147Total
            
            
            2,371,442
            
            
            1,180,948
            
            
            921,978**Operating
                Expenses:**Office
                occupancy and operations
            
            
            345,389
            
            
            345,859
            
            
            295,481Business
                development
            
            
            64,278
            
            
            69,372
            
            
            51,110Taxes-other
                than payroll and income
            
            
            138,687
            
            
            79,871
            
            
            90,004Professional
                fees
            
            
            141,297
            
            
            141,500
            
            
            68,245Other
                expenses
            
            
            105,873
            
            
            114,240
            
            
            82,211Total
            
            
            795,524
            
            
            750,842
            
            
            587,051**Equity
                in Net Income of Affiliated Cos.**
            
            
            7,336,417
            
            
            12,710,328
            
            
            12,984,996**Income
                Before Income Taxes**
            
            
            8,912,335
            
            
            13,140,434
            
            
            13,319,923**Provision
                (benefit) for Income Taxes**
            
            
            510,000
            
            
            (45,000
            )
            
            27,000**Net
                Income**
            
            $
            8,402,335
            
            $
            13,185,434
            
            $
            13,292,923**Basic
                Earnings per Common Share**
            
            $
            3.39
            
            $
            5.22
            
            $
            5.19**Weighted
                Average Shares Outstanding-Basic**
            
            
            2,479,321
            
            
            2,527,927
            
            
            2,560,418**Diluted
                Earnings Per Common Share**
            
            $
            3.35
            
            $
            5.14
            
            $
            5.10**Weighted
                Average Shares Outstanding-Diluted**
            
            
            2,508,609
            
            
            2,564,216
            
            
            2,607,633





See
      notes
      to condensed financial statements.










**SCHEDULE
      II**





**INVESTORS
      TITLE COMPANY (PARENT COMPANY)**


**CONDENSED
      FINANCIAL INFORMATION OF REGISTRANT**


**STATEMENTS
      OF CASH FLOWS**


**FOR
      THE YEARS ENDED DECEMBER 31, 2007, 2006 AND 2005**





**2007**
            
            **2006**
            
            **2005****Operating
                Activities:**Net
                income
            
            $
            8,402,335
            
            $
            13,185,434
            
            $
            13,292,923Adjustments
                to reconcile net income to net cash provided by operating
                activities:Equity
                in net earnings of subsidiaries
            
            
            (7,336,417
            )
            
            (12,710,328
            )
            
            (12,984,996
            )Depreciation
            
            
            124,686
            
            
            124,030
            
            
            80,129Amortization,
                net
            
            
            15,946
            
            
            (820
            )
            
            (1,391
            )Issuance
                of common stock in payment of bonuses and fees
            
            
            1,998
            
            
            5,013
            
            
            -Net
                realized gain on sales of investments
            
            
            (406,623
            )
            
            -
            
            
            (18,464
            )Provision
                (benefit) for deferred income taxes
            
            
            5,000
            
            
            (55,000
            )
            
            33,000(Increase)
                decrease in receivables
            
            
            146,500
            
            
            (205,760
            )
            
            33,540(Increase)
                decrease in income taxes receivable-current
            
            
            (378,491
            )
            
            356,796
            
            
            890,455(Increase)
                decrease in other assets
            
            
            19,852
            
            
            (153,593
            )
            
            (62,488
            )Increase
                (decrease) in accounts payable and accrued liabilities
            
            
            30,572
            
            
            260,468
            
            
            (290,719
            )Net
                cash provided by operating activities
            
            
            625,358
            
            
            806,240
            
            
            971,989**Investing
                Activities:**Capital
                contribution to subsidiaries
            
            
            -
            
            
            (115,000
            )
            
            (1,178,000
            )Return
                of capital contributions from subsidiaries
            
            
            -
            
            
            80,000
            
            
            -Dividends
                received from subsidiaries
            
            
            13,122,720
            
            
            9,446,950
            
            
            7,291,120Purchases
                of available-for-sale securities
            
            
            (31,721,740
            )
            
            (21,310,774
            )
            
            (9,435,060
            )Purchases
                of short-term securities
            
            
            (11,658,044
            )
            
            (1,459,550
            )
            
            -Purchases
                of and net earnings from other investments
            
            
            (94,737
            )
            
            -
            
            
            (150,000
            )Proceeds
                from sales and maturities of available-for-sale securities
            
            
            33,900,000
            
            
            13,600,000
            
            
            6,024,040Proceeds
                from sales of short-term securities
            
            
            -
            
            
            -
            
            
            1,007,700Proceeds
                from sales and distributions from other investments
            
            
            742,822
            
            
            216,190
            
            
            68,915Purchases
                of property
            
            
            (12,551
            )
            
            (18,151
            )
            
            (1,251,285
            )Net
                change in pending trades
            
            
            -
            
            
            -
            
            
            (1,027,929
            )Net
                cash provided by investing activities
            
            
            4,278,470
            
            
            439,665
            
            
            1,349,501**Financing
                Activities:**Retirement
                of common stock
            
            
            (4,660,259
            )
            
            (2,255,735
            )
            
            (363,765
            )Exercise
                of options
            
            
            365,284
            
            
            55,272
            
            
            -Dividends
                  paid (net dividends paid to subsidiary of $70,002, $70,401 and
                  $46,717in
                  2007, 2006 and 2005, respectively)
            
            
            (595,808
            )
            
            (606,423
            )
            
            (410,202
            )Net
                cash used in financing activities
            
            
            (4,890,783
            )
            
            (2,806,886
            )
            
            (773,967
            )**Net
                Increase (Decrease) in Cash and Cash Equivalents**
            
            
            13,045
            
            
            (1,560,981
            )
            
            1,547,523**Cash
                and Cash Equivalents, Beginning of Year**
            
            
            194,391
            
            
            1,755,372
            
            
            207,849**Cash
                and Cash Equivalents, End of Year**
            
            $
            207,436
            
            $
            194,391
            
            $
            1,755,372**Supplemental
                Disclosures:****Cash
                Paid During the Year For:**Income
                taxes (net of refunds)
            
            $
            889,000
            
            $
            343,000
            
            $
            896,000Non
                cash net unrealized (gain) loss on investments, net of deferred tax
                provision of ($219,001), ($185,475) and $213,400 for 2007, 2006 and
                2005,
                respectively
            
            $
            (414,956
            )
            $
            (361,631
            )
            $
            414,945Adjustments
                to apply FASB statement No. 158, net of deferred tax provision of
                $16,348
                and $21,024 for 2007 and 2006, respectively
            
            $
            31,734
            
            $
            40,810
            
            $
            -





See
      notes
      to condensed financial statements.









**SCHEDULE
      II**





**INVESTORS
      TITLE COMPANY (PARENT COMPANY)**


**CONDENSED
      FINANCIAL INFORMATION OF REGISTRANT**


**NOTES
      TO THE CONDENSED FINANCIAL STATEMENTS**





1.
            The
                accompanying condensed financial statements should be read in conjunction
                with the consolidated financial statements and notes thereto of Investors
                Title Company and Subsidiaries.





2.
            Cash
                dividends paid to Investors Title Company by its wholly owned subsidiaries
                were as follows:





Subsidiaries
            
            2007
            
            2006
            
            2005Investors
                Title Insurance Company, net*
            
            $
            10,662,720
            
            $
            4,976,950
            
            $
            4,546,120Investors
                Title Exchange Corporation
            
            
            2,250,000
            
            
            4,125,000
            
            
            2,250,000Investors
                Title Accomodation Corporation
            
            
            25,000
            
            
            170,000
            
            
            195,000Investors
                Title Management Services, Inc.
            
            
            -
            
            
            60,000
            
            
            275,000Investors
                Title Capital Management Corporation
            
            
            60,000
            
            
            -
            
            
            -Investors
                Title Commercial Agency
            
            
            125,000
            
            
            115,000
            
            
            25,000$
            13,122,720
            
            $
            9,446,950
            
            $
            7,291,120





*
            Total
                dividends of $10,732,722, $5,047,351 and $4,592,837 paid to the Parent
                Company in 2007, 2006 and 2005, respectively, netted with dividends
                of
                $70,002, $70,401 and $46,717 received from the Parent in 2007, 2006
                and
                2005, respectively.








**SCHEDULE
      III**





**INVESTORS
      TITLE COMPANY AND SUBSIDIARIES**


**SUPPLEMENTARY
      INSURANCE INFORMATION**


**For
      the Years Ended December 31, 2007, 2006 and 2005**


**Segment**
              
              **Deferred
                  Policy Acquisition Cost**
              
              **Future
                  Policy Benefits, Losses, Claims**
                **and Loss
                  Expenses**
              
              **Unearned
                  Premiums**
              
              **Other
                  Policy Claims and Benefits Payable**
              
              **Premium
                  Revenue**
              
              **Net
                  Investment Income**
              
              **Benefits
                  Claims, Losses and Settlement Expenses**
              
              **Amortization
                  of Deferred Policy Acquisition Costs**
              
              **Other
                  Operating Expenses**
              
              **Premiums
                  Written****Year
                  Ended December 31, 2007****Title
                  Insurance**
              
              
              —
              
              $
              36,975,000
              
              
              —
              $
              
              406,922
              
              $
              69,983,989
              
              $
              3,954,898
              
              $
              10,134,719
              
              
              —
              
              $
              58,034,137
              
              
              N/A**Exchange
                  Services**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              29,501
              
              
              —
              
              
              —
              
              
              1,480,094
              
              
              N/A**All
                  Other**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              1,212,779
              
              
              —
              
              
              —
              
              
              3,469,002
              
              
              N/A—
              
              $
              36,975,000
              
              
              —
              
              $
              406,922
              
              $
              69,983,989
              
              $
              5,197,178
              
              $
              10,134,719
              
              
              —
              
              $
              62,983,233**Year
                  Ended December 31, 2006****Title
                  Insurance**
              
              
              —
              
              $
              36,906,000
              
              
              —
              
              $
              470,468
              
              $
              70,196,467
              
              $
              3,688,966
              
              $
              7,405,211
              
              
              —
              
              $
              55,557,492
              
              
              N/A**Exchange
                  Services**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              18,138
              
              
              —
              
              
              —
              
              
              1,346,743
              
              
              N/A**All
                  Other**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              619,231
              
              
              —
              
              
              —
              
              
              3,022,836
              
              
              N/A—
              
              $
              36,906,000
              
              
              —
              
              $
              470,468
              
              $
              70,196,467
              
              $
              4,326,335
              
              $
              7,405,211
              
              
              —
              
              $
              59,927,071**Year
                  Ended December 31, 2005****Title
                  Insurance**
              
              
              —
              
              $
              34,857,000
              
              
              —
              
              $
              442,098
              
              $
              76,522,266
              
              $
              2,993,149
              
              $
              8,164,783
              
              
              —
              
              $
              57,850,106
              
              
              N/A**Exchange
                  Services**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              18,463
              
              
              —
              
              
              —
              
              
              907,414
              
              
              N/A**All
                  Other**
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              324,155
              
              
              —
              
              
              —
              
              
              2,358,652
              
              
              N/A—
              
              $
              34,857,000
              
              
              —
              
              $
              442,098
              
              $
              76,522,266
              
              $
              3,335,767
              
              $
              8,164,783
              
              
              —
              
              $
              61,116,172










**SCHEDULE
      IV**





**INVESTORS
      TITLE COMPANY AND SUBSIDIARIES**


**REINSURANCE**


**For
      the Years Ended December 31, 2007, 2006 and 2005**





****
            
            **Gross**
              **Amount**
            
            **Ceded to**
              **Other**
              **Companies**
            
            **Assumed from**
              **Other**
              **Companies**
            
            **Net**
              **Amount**
            
            **Percentage of**
              **Amount**
              **Assumed to Net****YEAR
                ENDED DECEMBER 31, 2007****Title
                Insurance**
            
            $
            70,205,350
            
            $
            264,177
            
            $
            42,816
            
            $
            69,983,989
            
            
            0.06
            %**YEAR
                ENDED DECEMBER 31, 2006****Title
                Insurance**
            
            $
            70,615,891
            
            $
            441,582
            
            $
            22,158
            
            $
            70,196,467
            
            
            0.03
            %**YEAR
                ENDED DECEMBER 31, 2005****Title
                Insurance**
            
            $
            76,817,423
            
            $
            316,133
            
            $
            20,976
            
            $
            76,522,266
            
            
            0.03
            %









**SCHEDULE
      V**





**INVESTORS
      TITLE COMPANY AND SUBSIDIARIES**


**VALUATION
      AND QUALIFYING ACCOUNTS**


**For
      the Years Ended December 31, 2007, 2006 and 2005**





**Description**
            
            **Balance at**
              **Beginning**
              **of Period**
            
            **Additions**
              **Charged to**
              **Costs and Expenses**
            
            **Additions Charged**
              **to Other**
              **Accounts -Describe**
            
            **Deductions- describe***
            
            **Balance at**
              **End of Period****2007****Premiums
                Receivable Valuation Provision**
            
            $
            2,128,000
            
            $
            5,298,809
            
            $
            -
            
            $
            (5,256,809
            (a))
            $
            2,170,000**Reserves
                for Claims**
            
            $
            36,906,000
            
            $
            10,134,719
            
            $
            -
            
            $
            (10,065,719
            (b))
            $
            36,975,000**2006****Premiums
                Receivable Valuation Provision**
            
            $
            2,444,000
            
            $
            4,927,691
            
            $
            -
            
            $
            (5,243,691
            (a))
            $
            2,128,000**Reserves
                for Claims**
            
            $
            34,857,000
            
            $
            7,405,211
            
            $
            -
            
            $
            (5,356,211
            (b))
            $
            36,906,000**2005****Premiums
                Receivable Valuation Provision**
            
            $
            2,240,000
            
            $
            5,399,734
            
            $
            -
            
            $
            (5,195,734
            (a))
            $
            2,444,000**Reserves
                for Claims**
            
            $
            31,842,000
            
            $
            8,164,783
            
            $
            -
            
            $
            (5,149,783
            (b))
            $
            34,857,000





**(a)
      Cancelled premiums**


**(b)
      Payments of claims, net of recoveries**







**INDEX
      TO EXHIBITS**




Exhibit
              Number
            
            Description3(i)
            
            Articles
                of Incorporation dated January 22, 1973, incorporated by reference
                to
                Exhibit 1 to Form 10 dated June 12, 19843(ii)
            
            Bylaws
                – (amended and restated November 12, 2007), incorporated by reference
                to
                Exhibit 3.1 to the Registrant’s Current Report on Form 8-K dated November
                12, 2007, File No. 0-117744
            
            Rights
                Agreement, dated as of November 12, 2002, between Investors Title
                Company
                and Central Carolina Bank, a division of National Bank of Commerce,
                incorporated by reference to Exhibit 1 to Form 8-A filed November
                15,
                200210(i)
            
            1997
                Stock Option and Restricted Stock Plan, incorporated by reference
                to
                Exhibit 10(viii) to Form 10-K for the year ended December 31,
                199610(ii)
            
            Form
                of Nonqualified Stock Option Agreement to Non-employee Directors
                dated May
                13, 1997 under the 1997 Stock Option and Restricted Stock Plan,
                incorporated by reference to Exhibit 10(ix) to Form 10-Q for the
                quarter
                ended June 30, 199710(iii)
            
            Form
                of Nonqualified Stock Option Agreement under 1997 Stock Option and
                Restricted Stock Plan, incorporated by reference to Exhibit 10(x)
                to Form
                10-K for the year ended December 31, 199710(iv)
            
            Form
                of Incentive Stock Option Agreement under 1997 Stock Option and Restricted
                Stock Plan, incorporated by reference to Exhibit 10(xi) to Form 10-K
                for
                the year ended December 31, 199710(v)
            
            Form
                of Amendment to Incentive Stock Option Agreement between Investors
                Title
                Company and George Abbitt Snead incorporated by reference to Exhibit
                10(xii) to Form 10-Q for the quarter ended June 30,
                200010(vi)
            
            2001
                Stock Option and Restricted Stock Plan, incorporated by reference
                to
                Exhibit 10(xiii) to Form 10-K for the year ended December 31,
                200010(vii)
            
            Form
                of Employment Agreement dated November 17, 2003 with each of J. Allen
                Fine, James A. Fine, Jr. and W. Morris Fine, incorporated by reference
                to
                Exhibit 10(ix) to Form 10-K for the year ended December 31,
                200310(viii)
            
            Amended
                and Restated Employment Agreement dated June 1, 2004 with J. Allen
                Fine,
                incorporated by reference to Exhibit 10(x) to Form 10-Q for the quarter
                ended June 30, 200410(ix)
            
            Form
                of Amended and Restated Employment Agreement dated June 1, 2004 with
                each
                of James A. Fine, Jr. and W. Morris Fine, incorporated by reference
                to
                Exhibit 10(xi) to Form 10-Q for the quarter ended June 30,
                2004









10(x)
            
            Nonqualified
                Deferred Compensation Plan dated June 1, 2004, incorporated by reference
                to Exhibit 10(xii) to Form 10-Q for the quarter ended June 30,
                200410(xi)
            
            Nonqualified
                Supplemental Retirement Benefit Plan dated November 17, 2003, incorporated
                by reference to Exhibit 10(xiii) to Form 10-Q for the quarter ended
                June
                30, 200410(xii)
            
            Death
                Benefit Plan Agreement dated April 1, 2004 with J. Allen Fine,
                incorporated by reference to Exhibit 10(xiv) to Form 10-Q for the
                quarter
                ended June 30, 200410(xiii)
            
            Death
                Benefit Plan Agreement dated May 19, 2004 with James A. Fine, Jr.,
                incorporated by reference to Exhibit 10(xv) to Form 10-Q for the
                quarter
                ended June 30, 200413
            
            Portions
                of 2007 Annual Report to Shareholders incorporated by reference in
                this
                report as set forth in Parts I, II and IV hereof21
            
            Subsidiaries
                of Registrant, incorporated by reference to Exhibit 21 to Form 10-K
                for
                the year ended December 31, 200323
            
            Consent
                of Dixon Hughes PLLC31(i)
            
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200231(ii)
            
            Certification
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200232
            
            Certification
                of Chief Executive Officer and Chief Financial Officer pursuant to
                Section
                906 of the Sarbanes-Oxley Act of
                2002