Bulletin: TX2024005

Dear Associates:

TDI has promulgated a new series of endorsements for use in Energy Projects beginning November 1, 2024, including the T-19.4. In conjunction with this new endorsement, TDI also promulgated Procedural Rule P-50.2 and Rate Rule R-29.2. The T-19.4 generally provides coverage for damage to, enforced removal, or alteration of any Severable Improvement resulting from use of the surface for extraction of minerals. It also provides a definition of Severable Improvement. The form contains specific exceptions, including fire, flood and subsidence, negligence of people and entities exercising their right to extract or develop minerals and for specific matters excluded in Schedule A or excepted in Schedule B that are to be excluded from coverage of the endorsement. Paragraph c requires you to insert “none” or list the specific matters excluded. This bulletin provides general information about the endorsement form only and does not provide a full analysis of coverage. Procedural Rule P-50.2 contains the TDI promulgated requirements for issuing the endorsement. They include:

• the policy must contain at least one exclusion or exception regarding minerals,
• the endorsement must be issued simultaneously with another specified new energy project endorsement (Energy Project – Leasehold/Easement Owner’s Policy Endorsement (T-55), Energy Project – Leasehold/Easement Loan Policy Endorsement (T-55.1), Energy Project – Leasehold Owner’s Policy Endorsement (T-55.2), Energy Project – Leasehold Loan Policy Endorsement (T-55.3), Energy Project – Fee Estate Owner’s Policy Endorsement (T-55.4), or Energy Project – Fee Estate Loan Policy Endorsement (T-55.5), and
• the insurer’s underwriting requirements are met.

The premium for this endorsement is 5% of the Basic Premium Rate for the Policy at the single-issue rate. This means the calculation for the endorsement must be done before other endorsement charges. A T-19.4 on a simultaneously issued loan policy is charged on the basic premium not the SI $100 rate. See R-29.2 for details. Issuance of this endorsement requires Stewart Title Guaranty Company Senior Underwriter approval. Please submit the following information with your request:

• a current survey,
• a copy of the Plans if the Electricity Facility is under construction or is to be constructed in the future,
• for each mineral exception in the commitment you will need to determine whether the mineral interest is limited to a royalty right (participating or non-participating), whether the mineral owner has waived/relinquished rights to use the surface of the Land in the original reservation/grant or by subsequent recorded agreement (often called surface waivers), or whether the mineral owner has joined in a recorded agreement designating a drill-site that does not include any part of the Land. Further requirements may be made upon review of the information submitted.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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