report of the commissioner to study - Maryland Insurance ...

More documents

Recommendations

Info

$C:\Documents and Settings\ThomasT\Local Settings\Temp ...$

In the event of the insolvency of a title insurance company, the TTIGA mayassess remaining underwriters to pay the insolvent insurer’s claims; the fee is based onwritten premium. 48This assessment may be recouped by insurers through an additionalfee on each title policy written plus a credit against future premium tax obligations, asdetermined by the TTIGA’s Board of Directors. 49Limitation on Commissions – Some states have capped the commissions that maybe collected by a title insurance producer. For example, South Carolina passed a bill in1988 designed to “regulate more stringently the title insurance business in this State.” 50Included among the provisions governing an underwriter’s reserve and reinsurancerequirements is a provision that imposes a statutory limit of 60% on title insuranceproducer commissions. 51Additionally, Connecticut caps commissions at 60% andFlorida provides that a maximum of 70% of title insurance premiums may go to a titleinsurance producer and 30% of the premium must be retained by the underwriter. 52NewMexico provides a sliding scale based on the value of the policy; title insurance producersmay retain a commission of 50% to 80% of premium. 53Consumer Protection Funds – There is a bill pending in Illinois that wouldestablish the Illinois Title Insurance Consumer Protection Fund funded through feesimposed upon “[e]very title insurance company and every independent escrowee” doingbusiness in Illinois. 54The purpose of the Fund would be to provide restitution toconsumers who have suffered financial loss as a result of a real estate settlement.48 TEX. INS. CODE ANN. § 2602.201 (2012).49 TEX. INS. CODE ANN. § 2602.210 (2012).50 State of South Carolina, Session 107 Senate Bill 1095 (1988).51 S.C. CODE ANN. § 38-75-1000 (2011).52 CONN. GEN. STAT. § 38a-415(b) (1990); FLA. ADMIN. CODE ANN. r. 69O-186.003 (2002).53 N.M. Code R. § 13.14.3.11 (1996).54 State of Illinois, Senate Bill 141 (2011).24
F. Other Relevant MattersChapter 683 also afforded the Commissioner the discretion to identify any othermatter relevant to the title insurance industry’s real estate settlement protection practicesand required the Commissioner to consider each relevant matter identified. TheCommissioner considered the following perspectives, offered by other state agencies,trade associations, and organizations in connection with the Study, to be relevant.1. State Agencies’ PerspectivesDivision of Consumer Protection of the Office of the Attorney General - TheAssistant Attorney General of the Consumer Protection Division confirmed that neitherthe Consumer Protection Division nor the Mediation Unit of the Office of the AttorneyGeneral had received complaints regarding the theft of escrow funds.Division of Financial Regulation of the Department of Labor Licensing andRegulation - The Director of Enforcement and the Division Commissioner determinedthat Chapter 683 would not affect the Office of the Commissioner of FinancialRegulation. DLLR recommended, however, that the Insurance Commissioner “considerthat all Maryland settlements be done through an attorney and utilize the attorney’sescrow account” for all settlement and closing funds.Maryland Real Estate Commission - In a letter to the MIA, the Maryland RealEstate Commission stated that “Maryland is known for being a state with some of thehighest closing fees in the country.” According to MREC, to “add another fee, so that theinsurers can recoup their losses seems counter-productive in these economic times.”2. Organizations’ PerspectivesNational Association of Insurance Commissioners - The NAIC has formed a title25
Page 2 and 3: Report of the Study ofClosing or Se
Page 4 and 5: TABLE OF CONTENTSI. EXECUTIVE SUMMA
Page 6 and 7: Although in a minority of states an
Page 8 and 9: or misuse of closing or settlement
Page 10 and 11: (4) Division of Consumer Protection
Page 12 and 13: title insurance producer or agency
Page 14 and 15: As part of its Insurer Survey, the
Page 16 and 17: or dishonest practices, the underwr
Page 18 and 19: eported having a least one escrow a
Page 20 and 21: ond also may be purchased by an und
Page 22 and 23: 4. Other Protection Available to Un
Page 24 and 25: 1. Preventive MeasuresProducer Lice
Page 26 and 27: lender’s funds or documents. The
Page 30 and 31: insurance task force. The informati
Page 32 and 33: in excess of 20 cents in claims on
Page 34 and 35: create an environment vulnerable to
Page 36 and 37: Appendix 1MARTIN O'MALLEY, Governor
Page 44 and 45: AppendixAppendix22MARTIN O’MALLEY
Page 46 and 47: Appendix 2c. If you answered “No
Page 48 and 49: Appendix 2Certification of Informat
Page 50 and 51: Appendix 2QUESTION #3Schedule BStat
Page 52 and 53: Appendix 3
Page 54 and 55: Appendix 3SURVEYTitle Insurance - C
Page 56 and 57: Appendix 3a. Does your title insura
Page 58 and 59: Appendix 3QUESTION # 2Schedule ADor
Page 60: Appendix 3QUESTION # 10Schedule CMi

report of the commissioner to study - Maryland Insurance ...

Create successful ePaper yourself

Delete template?

Save as template?