Bulletin: MD2010003

Date:
June 29, 2010
To:
All Maryland Issuing Offices
RE:
New Maryland Legislation - Title Insurance Producer Requirements

Dear Associates:

This bulletin is designed to inform you of the new requirements regarding Title Insurance Producer Independent Contractors (TIPIC).

HOUSE BILL 1470 (Chapter 740) - Title Insurance - Title Insurers and Title Insurance Producers - Regulation and Reports provides:

1.) Prohibits a title insurance producer from using or accepting the services of a title insurance producer independent contractor (TIPIC) unless the TIPIC is appointed by the title insurer and covered by the producer's fidelity bond, surety bond, or letter of credit;

2.) Provides that a producer is the legal principal of the TIPIC and is liable for all of the TIPIC's actions, even unintentional conduct, that occurs within the scope of the TIPIC's employment;

3.) Requires specified contact information to be included on a mortgage or deed of trust when executed by a TIPIC;

The recorded mortgage or deed of trust must include the following information on any paper within the settlement package that will be recorded as the Maryland Insurance Administration does not have at this time a specific form to be used for this purpose:

1.) The name, address and license number of the title insurance producer; and

2.) The name, address and license number of the TIPIC.

4.) Exempts a TIPIC from having to file a separate blanket fidelity bond, blanket surety bond, or letter of credit with the Commissioner since the TIPIC is covered under the title insurance producer's security;

Consequently, beginning July 1, 2010, new and renewing applicants for a title insurance producer license must provide the following to the Maryland Insurance Administration:

1.) Submit evidence of a blanket fidelity bond and a blanket surety bond or letter of credit if the applicant will not be acting as a TIPIC; OR

2.) Submit an affidavit for a title insurance producer generally or a title insurance producer who will be acting solely as a TIPIC (a licensed insurance producer acting solely on behalf of another title insurance producer). (Copies of the forms are attached to this bulletin and are also available on www.mdinsurance.state.md.us.)


Affidavits "A" and "B" (Click to View)

 


If you have any questions relating to this or other bulletins, please contact your local underwriting personnel or Stewart Legal Services.

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THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None