UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K
(Mark One)
  [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934
                   For the fiscal year ended December 31, 1998

  [   ] TRANSITION 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                          (I.R.S. Employer
      incorporation or organization)                         Identification No.)

          121 NORTH COLUMBIA STREET, CHAPEL HILL, NORTH CAROLINA 27514
                    (Address of principal executive offices)

       Registrant's telephone number, including area code: (919) 968-2200

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

    COMMON STOCK, NO PAR VALUE                        NONE
      (Title of each class)         (Name of the exchange on which registered)

        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
                                              ---    ---

        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 the Form 10-K or any
amendment to this Form 10-K. X
                            ---

On March 1, 1999, the aggregate market value of the voting and nonvoting common
equity held by nonaffiliates of the registrant was $53,142,021.

On March 1, 1999, the number of common shares outstanding was 2,810,349.

<TABLE>
<CAPTION>

                                  DOCUMENTS INCORPORATED BY REFERENCE
<S>                                                                                           <C>
               Documents                                                                      Form 10-K Reference
               Portions of Annual Report to Shareholders                                      Part I,  Items 1 and 2
               for fiscal year ended December 31, 1998                                        Part II, Items 5 - 8
                                                                                              Part IV, Item 14
               Portions of Proxy Statement (in connection with Annual Meeting                 Part III, Items 10 - 13
               to be held on May 11, 1999)
               Location of Exhibit Index: The Index to Exhibits is contained in Part IV herein on page 14.
</TABLE>


                                       1
<PAGE>
                                     PART I

ITEM 1. BUSINESS

General

        Investors Title Company ("the Company") is a holding company which was
incorporated in the State of North Carolina on February 13, 1973. The Company
became operational June 24, 1976 when it acquired as a wholly-owned subsidiary
Investors Title Insurance Company, a North Carolina corporation ("ITIC"), under
a plan of exchange of shares of common stock. On September 30, 1983, the Company
acquired as a wholly-owned subsidiary Investors Title Insurance Company of South
Carolina, a South Carolina corporation, under a plan of exchange of shares of
common stock. On June 12, 1985, its name was changed from Investors Title
Insurance Company of South Carolina to Northeast Investors Title Insurance
Company ("NE-ITIC".) The Company's executive offices are at 121 North Columbia
Street, Chapel Hill, North Carolina 27514. The Company's telephone number is
(919) 968-2200.

        Through its two wholly-owned title insurance subsidiaries, ITIC and
NE-ITIC, the Company underwrites land title insurance for owners and mortgagees
as a primary insurer and as a reinsurer for other title insurance companies.

        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. Since that date it has primarily written land
title insurance as a primary insurer and as a reinsurer in the States of North
Carolina and South Carolina. In addition, the Company currently writes title
insurance through issuing agents or branch offices in the States of Arkansas,
Florida, Georgia, Indiana, Kentucky, Maryland, Michigan, Minnesota, Mississippi,
Nebraska, Pennsylvania, Tennessee, Virginia and West Virginia. Agents issue
policies for ITIC and may also perform other services such as acting as escrow
agents.

        ITIC is also licensed to write title insurance in the District of
Columbia and the States of Alabama, Arizona, Colorado, Connecticut, Delaware,
Idaho, Illinois, Kansas, Louisiana, Massachusetts, Missouri, Montana, Nevada,
New Jersey, North Dakota, Ohio, Oklahoma, Rhode Island, Texas, Utah, Vermont,
Wisconsin and Wyoming.

        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 also currently writes title insurance as a primary insurer and as a
reinsurer in the State of New York.

        Title insurance guarantees owners, mortgagees, and others with a lawful
interest in real property against loss by reason of encumbrances and defective
title to such property. The commitments and policies issued are the standard
American Land Title Association approved forms. Title insurance policies do not
insure against future risks. Most other types of insurance protect against
losses and events in the future. ITIC is the leading title insurer of North
Carolina property and has held this position for fifteen years.

                                       2
<PAGE>

        In the State of North Carolina, title insurance commitments and policies
are issued by the home office and branch offices. ITIC has 28 branch offices in
North Carolina.

        In the ordinary course of business, ITIC and NE-ITIC reinsure certain
risks with other title insurers for the purpose of limiting their exposure and
also assume reinsurance for certain risks of other title insurers for which they
receive additional income. Reinsurance activities account for less than 1% of
total premium volume.

        ITIC currently assumes primary risks up to $1,500,000, reinsures the
next $250,000 of risk with NE-ITIC, and all risks above $1,750,000 are then
reinsured with a non-related reinsurer.

        NE-ITIC currently assumes primary risks up to $250,000, reinsures the
next $1,500,000 of risk with ITIC, and reinsures all amounts above $1,750,000
with a non-related reinsurer.

        The risk retention limits of ITIC and NE-ITIC are self-imposed and more
conservative than state insurance regulations.

        ITIC's financial stability has been recognized by two independent Fannie
Mae approved actuarial firms with the highest rating categories of "A Double
Prime - unsurpassed financial stability" and "A+ - strong overall financial
condition."

        NE-ITIC's financial stability has been recognized by two independent
Fannie Mae approved actuarial firms with rating categories of "A Prime -
unsurpassed financial stability" and "A - strong overall financial condition."

        In 1988, the Company established Investors Title Exchange Corporation, a
wholly-owned subsidiary ("ITEC"), to provide services in connection with
tax-free exchanges of like-kind property. ITEC acts as an intermediary in
tax-free 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.

        South Carolina Document Preparation Company, a wholly-owned subsidiary
("SCDP"), purchased the net assets of a former agency to provide services and
assistance to licensed members of the South Carolina Bar in the closing of real
estate transactions. SCDP was unprofitable and ceased these operations in 1995.
SCDP currently provides services in connection with tax-free exchanges of
like-kind property.

                                       3
<PAGE>

Operations of Subsidiaries

        ITIC offers primary title insurance coverage to owners and mortgagees of
real estate and reinsurance of title insurance risks to other title insurance
companies. Title insurance premiums written are for a one-time initial payment,
with no recurring premiums. Schedule A summarizes the net premiums written
during the years 1996 through 1998 by this subsidiary.

        NE-ITIC offers primary title insurance coverage to owners and mortgagees
of real estate and reinsurance of title insurance risks to other title insurance
companies. Title insurance premiums written are for a one-time initial payment
with no recurring premiums. Schedule A summarizes the net premiums written
during the years 1996 through 1998 by this subsidiary.

        ITEC offers services in connection with tax-free exchanges. Schedule A
summarizes total revenues during the years 1996 through 1998.

        SCDP had revenues of $21,628, $4,186 and $3,712 in 1998, 1997 and 1996,
respectively.

        For a description of Net Premiums Written geographically, refer to the
Management's Discussion and Analysis of Results of Operations and Financial
Condition in the 1998 Annual Report to Shareholders incorporated by reference in
this Form 10-K Annual Report.

Seasonality

        Title insurance premiums are closely related to the level of real estate
activity and the average price of real estate sales. The availability of funds
to finance purchases directly affects real estate sales. Other factors include
consumer confidence, economic conditions, supply and demand, mortgage interest
rates and family income levels. Historically, the first quarter has the least
real estate activity, while the remaining quarters are more active. Fluctuations
in mortgage interest rates can cause shifts in real estate activity outside of
the normal seasonal pattern.

Marketing

        ITIC's current and future marketing plan is based upon providing fast
and efficient service in the delivery of title insurance coverage through a home
office, branch offices, and issuing agents. In North Carolina, ITIC operates
through a home office and 28 branch offices. In South Carolina, ITIC operates
through a branch office and issuing agents located conveniently to customers
throughout the State. ITIC also writes title insurance policies through issuing
agents in Arkansas, Florida, Georgia, Indiana, Kentucky, Maryland, Michigan,
Minnesota, Mississippi, Nebraska, Pennsylvania, Tennessee, Virginia and West
Virginia.

        ITIC intends to establish branch and/or agency offices in the other
states in which it is licensed.

                                       4
<PAGE>

        NE-ITIC currently operates through two agency offices in the State of
New York.

        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 relationships to
increase market share. The Company's marketing efforts are also enhanced through
advertising.


                                       5
<PAGE>

                                   SCHEDULE A
                        INVESTORS TITLE INSURANCE COMPANY
                              NET PREMIUMS WRITTEN
                         For The Years Ended December 31

          1998                         1997                        1996

      $44,870,338                  $29,434,155                 $20,577,779
      ===========                  ===========                 ===========



                   NORTHEAST INVESTORS TITLE INSURANCE COMPANY
                              NET PREMIUMS WRITTEN
                         For The Years Ended December 31

          1998                         1997                        1996

       $509,358                      $441,195                    $533,376
       ========                      ========                    ========





                      INVESTORS TITLE EXCHANGE CORPORATION
                                   FEES EARNED
                         For The Years Ended December 31

          1998                         1997                        1996

       $627,729                      $542,688                    $272,998
       ========                      ========                    ========


                                       6
<PAGE>

Customers

        The Company is not dependent upon any single customer, the loss of which
could have a material effect on the Company.

Reserves

        The reserves for claims for financial reporting purposes are established
based on criteria discussed in Notes 1 and 6 to the Financial Statements
incorporated by reference in this Form 10-K Annual Report.

Regulations

        The Company's two insurance subsidiaries are subject to examination at
any time by the licensing states. Title insurance companies are extensively
regulated under applicable state laws. The regulatory authorities possess broad
powers with respect to the licensing of title insurers and agents, rates,
investments, policy forms, financial reporting, reserve requirements, dividend
restrictions as well as examinations and audits of title insurers.

        ITIC is domiciled in North Carolina and subject to North Carolina state
insurance regulations. Examinations are scheduled every five years by the North
Carolina Department of Insurance. ITIC was last examined by the North Carolina
Department of Insurance commencing on May 15, 1995 for the period January 1,
1992 through December 31, 1994 with no material deficiencies noted.

        NE-ITIC is domiciled in South Carolina and subject to South Carolina
state insurance regulations. Examinations are scheduled periodically by the
South Carolina Department of Insurance. NE-ITIC was last examined by the South
Carolina Department of Insurance commencing on June 22, 1998 for the period
January 1, 1994 through December 31, 1997, with no material deficiencies noted.

        In accordance with the insurance laws and regulations applicable to
title insurance in the State of North Carolina, ITIC has established and
maintains a statutory premium reserve for the protection of policyholders. ITIC
reserves an amount equal to 10% of current year premiums written. This amount is
then reduced annually by 5% and the net amount is accumulated in a statutory
premium reserve.

        NE-ITIC has established and maintains a statutory premium reserve as
required by the insurance laws and regulations of the State of New York. A $1.50
for each risk assumed under a policy or commitment plus one-eightieth of one
percent of the face amount of each commitment or policy, reduced by that portion
of the reserve established 15 years earlier are accumulated in a statutory
premium reserve for years up to 1985. In subsequent years, the addition to the
reserve is

                                       7
<PAGE>

calculated in the same manner but is reduced annually by 5%.

        These statutory premium reserve additions are not charged to operations
for financial reporting purposes and changes in the statutory premium reserve
have no effect on net income of the companies for financial reporting purposes.

        The Company is an insurance holding company, and is also 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 intercorporate
transfers including, in some instances, the payment of shareholders' dividends
by the insurance subsidiaries. All states set requirements for admission to do
business, including minimum levels of capital and surplus. State insurance
departments have broad administrative powers and monitor the stability and
service of insurance companies.

        In addition to the financial statements which are required to be filed
as part of this report and are prepared on the basis of generally accepted
accounting principles, the Company's insurance subsidiaries also prepare
financial statements in accordance with statutory accounting principles
prescribed or permitted by state regulations. Based upon the latter principles,
as of December 31, 1998, ITIC reported $23,307,030 of capital and surplus, and
net income of $6,033,721; and NE-ITIC reported $2,294,878 of capital and
surplus, and net income of $173,474.

        ITIC and NE-ITIC both meet the minimum capital and surplus requirements
of the states in which they are licensed.

Competition

        ITIC currently operates primarily in Michigan, North Carolina, South
Carolina and Virginia. ITIC's major competitors are Chicago Title Insurance
Company, Commonwealth Land Title Insurance Company, Fidelity National Title
Insurance Company, First American Title Insurance Company, Lawyers Title
Insurance Corporation, Old Republic National Title Insurance Company and Stewart
Title Guaranty Company. Key elements that affect competition are price,
expertise, timeliness and quality of service, financial strength and size of the
insurer.

Investments

        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. Some state laws impose certain restrictions upon
the types and amounts of investments that can be made by the Company's insurance
subsidiaries.



                                       8
<PAGE>

        The Company, ITIC, NE-ITIC, ITEC and SCDP had investment income as set
out in the following table for the years 1994 through 1998:


<TABLE>
<CAPTION>

                               FOR THE YEARS ENDED DECEMBER 31
                               -------------------------------
                   1998           1997           1996           1995          1994
                   ----           ----           ----           ----          ----
<S>                 <C>            <C>             <C>            <C>          <C>
Company             $ 76,390       $ 15,295        $67,162        $16,238      $12,225
ITIC               1,612,066      1,476,807      1,161,795      1,007,255      926,976
NE-ITIC              133,975        126,426        121,007        111,939      103,600
ITEC                  11,875          9,616          2,708          3,457        3,911
SCDP                     643             44            260          1,747            0
                  ----------     ----------     ----------     ----------   ----------

TOTAL             $1,834,949     $1,628,188     $1,352,932     $1,140,636   $1,046,712
                  ==========     ==========     ==========     ==========   ==========
</TABLE>



        See Note 3 to the Financial Statements incorporated herein by reference
for the major categories of investments, earnings by investment categories,
scheduled maturities, amortized cost, and market values of investment
securities.

Employees

        The Company, ITEC, NE-ITIC and SCDP have no paid employees. Officers of
the Company are full-time paid employees of ITIC, which had 209 full-time
employees and 19 part-time employees as of December 31, 1998.

Trademark

        The Company's subsidiary, ITIC, registered its logo with the U.S.
Patent-Trademark Office in February, 1987. The loss of said registration, in the
Company's opinion, would not materially affect its business.

                                       9
<PAGE>

ITEM 2.  PROPERTIES

        The Company owns property located at 135-137 East Rosemary Street,
Chapel Hill, North Carolina. This property currently serves as a parking
facility.

        The Company owns the office building and property located on the corner
of North Columbia and West Rosemary Streets in Chapel Hill, North Carolina,
which serves as the Company's corporate headquarters. The building contains
approximately 23,000 square feet. The Company's principal subsidiary, ITIC,
leases office space in 31 locations throughout North Carolina, South Carolina,
Michigan and Virginia.

        See Note 9 to the Financial Statements incorporated herein by reference
for the amounts of future minimum lease payments. Each of the office facilities
occupied by the Company and its subsidiaries are in good condition and adequate
for present operations.

ITEM 3.  LEGAL PROCEEDINGS

        The Company and its subsidiaries are involved in litigation on a number
of claims which arise in the normal course of business, none of which, in the
opinion of management are expected to have a material adverse effect on the
Company's consolidated financial position.

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, 1998.

                                       10
<PAGE>

ITEM 4A. EXECUTIVE OFFICERS OF THE COMPANY

Identification of Executive Officers

        The following table sets forth the executive officers of the Company as
of December 31, 1998. 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 respective successor has been elected.

<TABLE>
<CAPTION>

                             Position with         Officer       Term to
Name                  Age    Registrant            Since         Expire
----                  ---    ----------            -----         ------
<S>                   <C>                          <C>           <C>
J. Allen Fine         64     Chairman,             1973          1999
                             Director and
                             CEO

James A. Fine, Jr.    36     President, Director   1987          1999
                             and Treasurer

W. Morris Fine        32     Executive Vice        1992          1999
                             President and
                             Secretary

Elizabeth P. Bryan    38     Vice President        1987          1999
                             and Assistant Secretary

L. Dawn Martin        33     Vice President        1993          1999
                             and Assistant Secretary
</TABLE>


        J. Allen Fine, Chief Executive Officer and Chairman of the Board of
Directors, is the father of James A. Fine, Jr., President, Director and
Treasurer of the Company, and W. Morris Fine, Executive Vice President and
Secretary of the Company.

        The business experience of the Executive Officers of the Company is set
forth below:

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

James A. Fine, Jr. was named Vice President of the Company in 1987. In 1997, Mr.
Fine was named President and Treasurer and appointed a Director of the Company.
James A. Fine, Jr. is the

                                       11
<PAGE>

son of J. Allen Fine, Chief Executive Officer and Chairman of the Board of the
Company, and brother of W. Morris Fine, Executive Vice President and Secretary
of the Company.

W. Morris Fine joined the Company in July, 1992, and was subsequently named Vice
President of the Company. In 1993, Mr. Fine was named Treasurer of the Company
and served in that capacity until 1997. In 1997, Mr. Fine was named Executive
Vice President and Secretary of the Company. Morris Fine is the son of J. Allen
Fine, Chairman and Chief Executive Officer of the Company, and brother of James
A. Fine, Jr., President, Director and Treasurer of the Company.

Elizabeth P. Bryan joined the Company in 1985 as Controller and in 1987, she was
named Vice President of the Company.

L. Dawn Martin joined the Company in February, 1991 and in 1993, she was named
Vice President of the Company.

                                     PART II


ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         The high and low sales prices for the common stock on NASDAQ and the
dividends paid per common share for each quarter in the last two fiscal years
are indicated under "Shareholder Information" in the 1998 Annual Report to
Shareholders and are incorporated herein by reference.

ITEM 6.  SELECTED FINANCIAL DATA

        The selected financial data for the five years ended December 31, 1998
is in the 1998 Annual Report to Shareholders under the caption "Financial
Highlights" and is incorporated herein by reference. The information should be
read in conjunction with the Financial Statements and Notes and the Management's
Discussion and Analysis of Results of Operations and Financial Condition which
are in the 1998 Annual Report to Shareholders and are incorporated herein by
reference.

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

        Management's Discussion and Analysis of Results of Operations and
Financial Condition in the 1998 Annual Report to Shareholders is incorporated
herein by reference.

                                       12
<PAGE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        Management's Discussion and Analysis of Quantitative and Qualitative
Disclosures about Market Risk in the 1998 Annual Report to Shareholders is
incorporated herein by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        The financial statements and supplementary data in the 1998 Annual
Report to Shareholders are incorporated herein by reference.

        The financial statement schedules meeting the requirements of Regulation
S-X are shown as Schedules I, II, III, IV and V included on pages 20 through 27.

        The supplementary financial information (Selected Quarterly Financial
Data) in the 1998 Annual Report to Shareholders is incorporated herein by
reference.

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

          There were no changes in, nor disagreements with, accountants on
accounting and financial disclosure.

                                    PART III
ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Identification of Directors

        Information pertaining to Directors of the Company under the heading
"Election of Directors" in the Company's definitive Proxy Statement for the
Annual Meeting of Shareholders to be held on May 11, 1999 is incorporated herein
by reference. Other information with respect to executive officers is contained
in Part I - Item 4(a) under the caption "Executive Officers of the Company".

ITEM 11.  EXECUTIVE COMPENSATION

        Information pertaining to executive compensation under the heading
"Executive Compensation" in the Company's definitive Proxy Statement relating to
the Annual Meeting of Shareholders to be held on May 11, 1999 is incorporated
herein by reference.

                                       13
<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        Information pertaining to securities ownership of certain beneficial
owners and management under the heading "Ownership of Stock by Executive
Officers and Certain Beneficial Owners" in the Company's definitive Proxy
Statement relating to the Annual Meeting of Shareholders to be held on May 11,
1999 is incorporated herein by reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        Information pertaining to certain relationships and related transactions
under the heading "Compensation Committee Interlocks and Insider Participation"
in the Company's definitive Proxy Statement relating to the Annual Meeting of
Shareholders to be held on May 11, 1999 is incorporated herein by reference.


                                           PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(A) The following documents are filed as part of this report:
1. Financial Statements

        The following financial statements in the 1998 Annual Report to
Shareholders are hereby incorporated by reference:

        Report of Independent Accountants
        Consolidated Balance Sheets as of December 31, 1998 and 1997
        Consolidated Statements of Income for the Years Ended December 31, 1998,
               1997 and 1996
        Consolidated Statements of Stockholders' Equity for the Years Ended
               December 31, 1998, 1997 and 1996
        Consolidated Statements of Comprehensive Income for the Years Ended
               December 31, 1998, 1997 and 1996
        Consolidated Statements of Cash Flows for the Years Ended December 31,
               1998, 1997 and 1996
        Notes to Consolidated Financial Statements

                                       14
<PAGE>

2. Financial Statement Schedules

The following is a list of financial statement schedules and the Auditors'
Report on such schedules filed as part of this report on Form 10-K:

Investors Title Company and Subsidiaries:
Independent Auditors' Report on Financial Statement Schedules

Schedule Number              Description
---------------              -----------
I                            Summary of Investments - Other Than Investments
                                in Related Parties
II                           Condensed Financial Information of Registrant
III                          Supplementary Insurance Information
IV                           Reinsurance
V                            Valuation and Qualifying Accounts

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

****
3. Exhibits

<TABLE>
<CAPTION>

                                                          Page Number or
Exhibit                                                   Incorporation by
Number  Description                                       Reference to
------  -----------                                         ------------
<S>            <C>                                        <C>
(3)(i)         Articles of Incorporation                  Exhibit 1 to Form 10,
                                                          dated June 12, 1984

(3)(ii)        Bylaws                                     Exhibit 2 to Form 10,
                                                          dated June 12, 1984

(3)(iii)       Amendment to Bylaws adopted                Exhibit 3(iii) to Form
               March 10, 1997                             10-K, page 27, dated
                                                          December 31, 1996

Management contract of compensatory plan or arrangement
(Exhibits (10)(i) - (10)(xi))

(10)(i)        1988 Incentive Stock Option Plan            Exhibit 10 to Form
                                                           10-K,    page    31,
                                                           dated  December  31,
                                                           1989






                                       15
<PAGE>


                                                         Page Number or
Exhibit                                                  Incorporation by
Number         Description                               Reference to
------         -----------                               ------------
(10)(ii)       1993 Incentive Stock Option Plan          Exhibit 10 to Form
                                                         10-K, page 32,
                                                         dated December 31,
                                                         1993

(10)(iii)      1993 Incentive Stock Option Plan          Exhibit 10 to Form
               W. Morris Fine                            10-K, page 33, dated
                                                         December 31,1993

(10)(iv)       Employment Agreement date                 Exhibit 10 to Form
               February 9, 1984 with                     10-K, page 14, dated
               J. Allen Fine, Chairman                   December 31, 1985

(10)(v)        Form of Incentive Stock Option            Exhibit 10(v) to Form
               Agreement under 1993 Incentive            10-K, page 29, dated
               Stock Option Plans                        December 31, 1994

(10)(vi)       Form of Amendment dated                   Exhibit 10(vi) to Form
               November 8, 1994 to Stock Option          10-Q, page 11, dated
               Agreement dated as of November 13, 1989   March 31, 1995

(10)(vii)      Form of Stock Option Agreement            Exhibit 10(vii) to Form
               dated November 13, 1989                   10-Q, page 13, dated
                                                         March 31, 1995

(10)(viii)     1997 Stock Option and Restricted          Exhibit 10(viii) to Form
               Stock Plan                                10-K, page 29, dated
                                                         December 31, 1996

(10)(ix)       Form of Nonqualified Stock Option         Exhibit 10(ix) to Form
               Agreement to Non-employee Directors       10-Q, page 13, dated
               dated May 13, 1997 under the 1997         June 30, 1997
               Stock Option and Restricted Stock
               Plan

(10)(x)        Form of Nonqualified Stock Option         Exhibit 10(x) to Form
               Agreement under 1997 Stock Option         10-K, page 27, dated
               and Restricted Stock Plan                 December 31, 1997

(10)(xi)       Form of Incentive Stock Option            Exhibit 10(xi) to Form
               Agreement under 1997 Stock Option         10-K, page 34, dated
               and Restricted Stock Plan                 December 31, 1997

                                       16
<PAGE>


                                                         Page Number or
Exhibit                                                  Incorporation by
Number         Description                               Reference to
------         -----------                               ------------
(13)           Portions of 1998 Annual                   Included herewith
               Report to Shareholders
               incorporated by reference
               in this report as set forth
               in Part II hereof.

(21)           Subsidiaries of Registrant                Exhibit 21 to Form
                                                         10-K, page 55, dated
                                                         December 31, 1994

(27)           Financial Data Schedule - 1998            Included herewith

(B) Reports on Form 8-K
        No reports were filed on Form 8-K for the fourth quarter.
</TABLE>



                                       17
<PAGE>




                                   SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the 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



                              By: /s/J. Allen Fine
                                  -----------------------
                                  J. Allen Fine
                      Chairman and Chief Executive Officer
                              Date: March 30, 1999
                                    ----------------------

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 on the 30th day of March, 1999.




/s/J. Allen Fine
------------------------------------------------
J. Allen Fine, Chairman and Chief Executive
Officer


/s/James A. Fine, Jr.
---------------------------------------------
James A. Fine, Jr., President, Treasurer
and Director (Principal Financial Officer)


/s/Elizabeth P. Bryan
--------------------------------------------
Elizabeth P. Bryan, Vice President and Asst.
Secretary (Principal Accounting Officer)


/s/Lillard H. Mount
--------------------------------------------
Lillard H. Mount, Director

/s/David L. Francis
---------------------------------------------
David L. Francis, Director

---------------------------------------------
Loren B. Harrell, Jr., Director


/s/William J. Kennedy III
------------------------------------------
William J. Kennedy III, Director


/s/H. Joe King, Jr.
----------------------------------------------
H. Joe King, Jr., Director


/s/James R. Morton
-------------------------------------------
James R. Morton, Director


/s/A. Scott Parker, III
-----------------------
A.Scott Parker, III, Director


                                       18
<PAGE>





INDEPENDENT AUDITORS' REPORT


Investors Title Company and subsidiaries:

We have audited the consolidated financial statements of Investors Title Company
(the "Company") and its subsidiaries as of December 31, 1998 and 1997, and for
each of the three years in the period ended December 31, 1998, and have issued
our report thereon dated January 29, 1999; such consolidated financial
statements and report are included in your 1998 Annual Report to Shareholders
and are incorporated herein by reference. Our audits also included the
consolidated financial statement schedules of the Company, listed in Item 14.
These financial statement schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion based on our audits. In
our opinion, such financial statement schedules, when considered in relation to
the basic consolidated financial statements taken as a whole, present fairly in
all material respects the information set forth therein.





/s/ Deloitte & Touche, LLP.
Raleigh, North Carolina

January 29, 1999





                                       19
<PAGE>


<TABLE>
<CAPTION>
                                                                                             SCHEDULE I

                                  INVESTORS TITLE COMPANY AND SUBSIDIARIES
                                           SUMMARY OF INVESTMENTS
                                          As of December 31, 1998

-------------------------------------------------------------------------------------------------------------
                                                                                                Amount at
                                                                                               which shown
                                                                                                 in the
Type of Investment                                          Cost(1)        Market Value       Balance Sheet
-------------------------------------------------------------------------------------------------------------

Fixed Maturities:
  Bonds:
<S>     <C>    <C>    <C>                                      <C>                 <C>               <C>

    States, municipalities and political
      subdivisions                                         $26,384,756        $27,667,864        $27,439,790
     Public utilities                                          199,078            225,440            225,440
     All other corporate bonds                                 735,815            759,000            759,000
  Certificates of deposit                                       98,982             98,982             98,982
                                                         --------------   ----------------   ----------------
      Total fixed maturities                                27,418,631         28,751,286         28,523,212
                                                         --------------   ----------------   ----------------

Equity Securities:
  Common Stocks:
      Public utilities                                         385,394            719,200            719,200
      Banks, trust and insurance companies                     415,810          1,543,907          1,543,907
      Industrial, miscellaneous and all other                1,113,472          2,399,244          2,399,244
  Nonredeemable preferred stocks                               608,117            613,561            613,561
                                                         --------------   ----------------   ----------------
      Total equity securities                                2,522,793          5,275,912          5,275,912
                                                         --------------   ----------------   ----------------
Total investments per the consolidated balance sheet        29,941,424                            33,799,124
                                                         --------------                      ----------------

Short-term investments                                       7,466,378                             7,466,378
                                                         --------------                      ----------------
      Total investments                                    $37,407,802                           $41,265,502
                                                         ==============                      ================
</TABLE>


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


                                       20
<PAGE>



                                                                    SCHEDULE II




                    INVESTORS TITLE COMPANY (PARENT COMPANY)
                  CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                                 BALANCE SHEETS
                        AS OF DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>

<S>                                                                   <C>                  <C>
                                                                      1998                 1997
Assets
  Cash and Cash Equivalents                                        $ 208,315             $ 535,565
  Investments in equity securities                                    75,000                75,000
  Investments in affiliated companies                             31,421,749            26,685,072
  Income taxes receivable                                          1,171,548               392,531
  Other receivables                                                   94,133               116,039
  Deferred income tax                                                110,025                94,571
  Prepaid expenses and other assets                                    2,423                68,645
  Property, net                                                    1,737,491             1,765,509
                                                            -----------------    ------------------

TOTAL ASSETS                                                    $ 34,820,684          $ 29,732,932
                                                            =================    ==================

LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
  Accounts payable and accrued liabilities                         $ 119,826             $ 148,894
                                                            -----------------    ------------------

STOCKHOLDERS' EQUITY:
  Common stock-No par (shares authorized,
    6,000,000; 2,855,744 and 2,855,744 shares issued
    and 2,809,123 and 2,800,240
    shares outstanding 1998 and
    1997, respectively)                                            1,650,350             1,650,350
  Retained earnings                                               33,050,508            27,933,688
                                                            -----------------    ------------------
    Total stockholders' equity                                    34,700,858            29,584,038
                                                            -----------------    ------------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                      $ 34,820,684          $ 29,732,932
                                                            =================    ==================

</TABLE>


See notes to condensed financial statements.


                                       21
<PAGE>

<TABLE>
<CAPTION>

                                                                                                SCHEDULE II
                    INVESTORS TITLE COMPANY (PARENT COMPANY)
                  CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                              STATEMENTS OF INCOME
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996


<S>                                                         <C>                 <C>                  <C>
                                                            1998                1997                 1996
Revenues:
Investment income-interest and dividends                 $ 76,390             $ 15,295             $ 67,163
Rental income                                             435,821              362,889              350,331
Miscellaneous income                                       23,014                    -                1,000
                                                  ----------------   ------------------   ------------------
     Total                                                535,225              378,184              418,494
                                                  ----------------   ------------------   ------------------
OPERATING EXPENSES:
Office occupancy and operations                           138,475              133,283              142,872
Business development                                       13,234               10,927                8,593
Taxes-other than payroll and income                        48,569               30,499               49,579
Professional fees                                          22,269               43,516               33,684
Interest expense                                                -                    -                7,692
Other expenses                                            105,857              184,492               36,231
                                                  ----------------   ------------------   ------------------
     Total                                                328,404              402,717              278,651
                                                  ----------------   ------------------   ------------------

Equity in Net Income of Affiliated Cos.*                5,311,677            4,536,715            3,745,375
                                                  ----------------   ------------------   ------------------
Income Before Income Taxes                              5,518,498            4,512,182            3,885,218
                                                  ----------------   ------------------   ------------------
Provision for Income Taxes                                 58,989              (18,200)              41,681
                                                  ================   ==================   ==================
Net Income                                            $ 5,459,509          $ 4,530,382          $ 3,843,537
                                                  ================   ==================   ==================
Basic Earnings per Common Share                            $ 1.95               $ 1.63               $ 1.39
                                                  ================   ==================   ==================
Weighted Average Shares Outstanding-Basic               2,806,267            2,782,449            2,772,286
                                                  ================   ==================   ==================
Diluted Earnings Per Common Share                          $ 1.92               $ 1.60               $ 1.37
                                                  ================   ==================   ==================
Weighted Average Shares Outstanding-Diluted             2,841,035            2,826,730            2,813,001
                                                  ================   ==================   ==================
</TABLE>


* Eliminated in consolidation

See notes to condensed financial statements.


                                       22
<PAGE>

<TABLE>
<CAPTION>
                                                                                                                SCHEDULE II
                                   
                    INVESTORS TITLE COMPANY (PARENT COMPANY)
                 CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

<S>                                                                           <C>              <C>                  <C>
                                                                              1998             1997                 1996
Operating Activities:
  Net income                                                             $ 5,459,509       $ 4,530,382          $ 3,843,537
   Adjustments to reconcile net income to net cash provided
     by operating activities:
         Equity in net earnings of subsidiaries less dividends received of
           $575,000, $595,000 and $510,000 in 1998, 1997 and 1996,
           respectively                                                   (4,736,677)       (3,941,715)          (3,235,375)
         Gain on disposal of property                                        (20,475)                -                    -
         Depreciation                                                         57,573            62,362               68,560
         Benefit for deferred income taxes                                   (15,454)          (68,883)              (7,116)
         (Increase) decrease in receivables                                   21,906           (70,806)              13,607
         (Increase) decrease in income taxes receivable-current             (779,017)           70,914              100,942
         Increase in prepaid expenses                                         66,222           149,477                    -
         Increase (decrease) in accounts payable and accrued liabilities     (29,068)           27,967              (19,580)
                                                                      ---------------  ----------------    -----------------
            Net cash provided by operating activities                         24,519           759,698              764,575
                                                                      ---------------  ----------------    -----------------

INVESTING ACTIVITIES:
   Purchases of securities                                                         -                 -              (30,000)
   Proceeds from sales of securities                                               -            15,000                    -
   Purchases of furniture and equipment and building                         (31,555)          (36,112)              (2,980)
   Proceeds from the disposal of property                                     22,475                 -                    -
                                                                      ---------------  ----------------    -----------------
      Net cash used in investing activities                                   (9,080)          (21,112)             (32,980)
                                                                      ---------------  ----------------    -----------------

FINANCING ACTIVITIES:
   Payments on demand notes                                                        -                 -             (362,000)
   Dividends paid                                                           (342,689)         (342,689)            (271,297)
                                                                      ---------------  ----------------    -----------------
      Net cash used in financing activities                                 (342,689)         (342,689)            (633,297)
                                                                      ---------------  ----------------    -----------------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                        (327,250)          395,897               98,298
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                 535,565           139,668               41,370
                                                                      ===============  ================    =================
CASH AND CASH EQUIVALENTS, END OF YEAR                                     $ 208,315         $ 535,565            $ 139,668
                                                                      ===============  ================    =================

SUPPLEMENTAL DISCLOSURES:
CASH PAID DURING THE YEAR FOR:
   Interest                                                                $      -          $       -            $ 15,837
                                                                      ===============  ================    =================
   Income Taxes                                                            $ 853,460         $ (20,231)           $ (48,801)
                                                                      ===============  ================    =================
</TABLE>

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING ACTIVITIES:
During 1996, the Company exchanged assets with a value of $60,000 for an equity
investment.


See notes to condensed financial statements.


                                       23
<PAGE>








                                                                    SCHEDULE II

                    INVESTORS TITLE COMPANY (PARENT COMPANY)
                 CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                    NOTES TO 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
        subsidiary, Investors Title Insurance Company, were $350,000, $350,000
        and $350,000 in 1998, 1997 and 1996, respectively. Cash dividends paid
        to Investors Title Company by its wholly-owned subsidiary, Investors
        Title Exchange Corporation, were $225,000, $245,000 and $160,000 in
        1998, 1997 and 1996, respectively.


                                       24
<PAGE>


<TABLE>
<CAPTION>


                                                                                                                        SCHEDULE III
                                 INVESTORS TITLE COMPANY AND SUBSIDIARIES
                                    SUPPLEMENTARY INSURANCE INFORMATION
                           FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996

-----------------------------------------------------------------------------------------------------------------------------------
                                 Future
                                 Policy               Other
                                Benefits,             Policy                            Benefits  Amortization
                     Deferred    Losses,              Claims                            Claims,   of Deferred
                      Policy     Claims                and         Net        Net      Losses and    Policy       Other
                    Acquisition and Loss   Unearned  Benefits    Premium   Investment  Settlement Acquisition   Operating  Premiums
      Segment          Cost     Expenses   Premiums  Payable     Revenue     Income     Expenses     Costs      Expenses   Written
-----------------------------------------------------------------------------------------------------------------------------------
<S>                 <C>           <C>       <C>      <C>           <C>           <C>           <C>     <C>        <C>        <C>
Year Ended
December 31, 1998
Title               --      $ 13,362,665     --     $ 84,598 $45,379,696    $1,834,949  $ 8,094,950     --     $32,685,804   N/A
                                                                                                   
Year Ended                                                                                         
December 31, 1997                                                                                  
Title               --       $ 7,622,140     --     $ 96,241 $29,875,350   $ 1,628,188  $ 4,679,353     --     $21,260,381   N/A
                                                                                                   
Year Ended                                                                                         
December 31, 1996                                                                                  
Title               --       $ 5,086,065     --      $60,902 $21,111,155   $ 1,352,932  $ 2,939,741     --     $14,629,904   N/A
                                                                                        
</TABLE>

                                       25
<PAGE>


                                                                    SCHEDULE IV
                        INVESTORS TITLE COMPANY AND SUBSIDIARIES
                                      REINSURANCE
                 For the Years Ended December 31, 1998, 1997, and 1996

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
                                          Ceded to   Assumed from             Percentage of
                             Gross         Other        Other         Net        Amount
                             Amount       Companies    Companies     Amount    Assumed to Net
---------------------------------------------------------------------------------------------
<S>                         <C>             <C>         <C>       <C>              <C>      
YEAR ENDED                                                                                  
DECEMBER 31, 1998                                                                           
TITLE INSURANCE PREMIUMS    $45,618,518     $312,627    $73,805   $45,379,696      0.2%     
                                                                                            
YEAR ENDED                                                                                  
DECEMBER 31, 1997                                                                           
TITLE INSURANCE PREMIUMS    $30,058,724     $241,821    $58,447   $29,875,350      0.2%     
                                                                                            
YEAR ENDED                                                                                  
DECEMBER 31, 1996                                                                           
TITLE INSURANCE PREMIUMS    $21,187,689     $121,093    $44,559   $21,111,155      0.2%     
</TABLE>



                                       26
<PAGE>

                                                                     SCHEDULE V
                            INVESTORS TITLE COMPANY AND SUBSIDIARIES
                                VALUATION AND QUALIFYING ACCOUNTS
                      For the Years Ended December 31, 1998, 1997 and 1996
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------
                       Balance at      Additions       Additions Charged    
                       Beginning      Charged to           to Other         Deductions-    Balance at
Description            of Period   Costs and Expenses  Accounts - Describe   describe*    End of Period
--------------------------------------------------------------------------------------------------------
<S>                    <C>               <C>                     <C>            <C>        <C>
1998
Premiums Receivable
Valuation Provision   $   350,000   $   425,000               $-            $      -       $   775,000
                                                                           
Impairment of                                                              
Building Plans        $   150,000   $    68,122               $-            $      -       $   218,122
                                                                           
Reserves for                                                               
Claims                $ 7,622,140   $ 8,094,950               $-            $(2,354,425)   $13,362,665
                                                                           
Provision for                                                              
Equipment Disposal    $      -      $   280,000               $-            $      -       $   280,000
                                                                           
                                                                           
1997
Premiums Receivable                                                        
Valuation Provision   $   200,000   $   150,000               $-            $      -       $   350,000
                                                                           
Impairment of                                                              
Building Plans        $      -      $   150,000               $-            $      -       $   150,000
                                                                           
Reserves for                                                               
Claims                $ 5,086,065   $ 4,679,353               $-            $(2,143,278)   $ 7,622,140
                                                                           
1996
Premiums Receivable                                                        
Valuation Provision   $   120,000   $    80,000               $-            $      -       $   200,000
                                                                           
Reserves For                                                               
Claims                $ 3,836,065   $ 2,939,741               $-            $(1,689,741)   $ 5,086,065
                                                                   
</TABLE>




*Payments of Claims


                                       27