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WILMINGTON, Del. — Land-America Financial Group Inc., the third-largest U.S. title insurer, filed for bankruptcy after announcing a $298 million sale of three subsidiaries — including two of Arizona's biggest title insurers — to Fidelity National Financial Inc. and Chicago Title Insurance Co.

The Chapter 11 petition in U.S. Bankruptcy Court in Richmond, Va., listed $3.2 billion in assets and $2.8 billion in debt as of Sept. 30. LandAmerica said in a statement that it will sell Fidelity and Chicago Title its two principal title underwriting subsidiaries, Lawyers Title Insurance Corp. and Commonwealth Land Title Insurance Co., and another unit.

The bankruptcy filing and sale come two days after LandAmerica said a planned sale to Fidelity National was terminated.

Lawyers Title and Commonwealth Land Title both are licensed title insurers in Arizona.

In 2007, Lawyers Title was the third-largest title insurer in the state, with more than $51 million in premiums written and a 10.2 percent market share, according to the Arizona Department of Insurance. Commonwealth Land Title ranked sixth, with $32 million in premiums written and a 6.4 percent market share.

Lawyers Title Agency of Arizona, which serves as an agent of Lawyers Title Insurance, lists about a dozen Tucson-area offices. Agency officials could not be reached for comment Wednesday.

LandAmerica, based in Glen Allen, Va., lists three administrative offices, including a trust sales department, in Phoenix and 47 agency offices in the Phoenix area. The company also lists 18 other offices in Apache, Coconino, Mohave, Navajo, Santa Cruz and Yavapai counties.

All employees and business of LandAmerica will transfer to Fidelity National when the deal closes, which is expected by the end of the year, said Lloyd Osgood, senior vice president of corporate communications for LandAmerica. "The vast majority of employees and business will move over to Fidelity," Osgood said.

LandAmerica said in a statement that Lawyers Title and Commonwealth Land Title will continue to operate and serve customers during the completion of the sale, and that both underwriters are "entirely solvent."

Osgood said LandAmerica already had been cutting some operations to deal with the housing slump. Osgood wouldn't speculate on what Fidelity might do with the former LandAmerica operations.

LandAmerica was forced to sell after losses from the decline in housing sales jeopardized its independence. Land-America had posted four straight quarterly losses.

Chicago Title will acquire LandAmerica's Commonwealth Land Title Insurance unit for $158.6 million and Fidelity will buy Lawyers Title Insurance and United Capital Title Insurance for $139.4 million, Fidelity said in a separate statement.

The company filed bankruptcy to facilitate the sale, the company said in the statement.

The four largest creditors without collateral backing their claims were listed as: Prudential Capital Group, owed $150 million; Bank of America as trustee, owed $125 million; SunTrust Bank, owed $100 million; and Bank of New York Mellon as trustee, owed $98.5 million.

The company has provided real estate transaction services for more than 130 years, and serves agent, residential, commercial and lender customers in the United States, Mexico, Canada, the Caribbean, Latin America, Europe and Asia, according to its Web site.

It uses a database and public records to verify a seller is the home's true owner and that the property is free from liens.