Changes have been made to the New Jersey Rate Manual. The Manual has been filed with the New Jersey Department of Banking and Insurance and is effective October 1, 2014. Please take the opportunity to familiarize yourself with the updated Rate Manual. Article 3: General Rules has been updated as follows:
Section 3.1.1 Policy Issued at a time other than Acquisition of Title: Additional language has been added to this section directing that when property is acquired for nominal consideration, the underwriting rate shall be calculated in accordance with Section 3.1.2. Section 3.1.2 provides the underwriting rate when the policy has been issued at a time other than acquisition of title. More specifically, that the rate shall be based upon at least the fair market value of the property as established to the insurer's satisfaction.
Section 3.1.3 Conversion of Estate Insured: This section now directs how the Standard Underwriting Rate shall be calculated.
Section 10.73 ALTA 33-06 Disbursement: The wording in this section is changed to add the word "Disbursement" in front of Coverage instead of simply Coverage.
Section 10.91 ALTA 12.1-06 Aggregation - State Limits - Loan: This section now specifies the premium charged is tied into the issuance of New Jersey policies only.
The updated manual also includes the following three endorsements, which the Department of Banking and Insurance has approved for use in New Jersey effective October 1, 2014:
NJRB 5-161 ALTA Endorsement 43-06 Anti-Taint: This endorsement may be issued with a Loan policy only; the charge for the issuance of this endorsement is 10% of the underwriting charge with a minimum of $100. This endorsement insures against loss or damage sustained by the Insured by reason of the loss of priority of the lien of the Insured Mortgage, where a portion of the indebtedness secured by the Insured Mortgage is a "Revolving Credit Loan" and another portion is a "Term Loan", as security for the amount of the Indebtedness advanced as the Term Loan, resulting from reductions and subsequent increases of the outstanding principal amount of the Indebtedness payable as the Revolving Credit Loan.
NJRB 5-162 New Jersey Contract Vendee's Endorsement: This endorsement may be issued with a Loan or Owner's Policy. The charge for issuance is 10% of the underwriting charge, with a $100 minimum. This endorsement provides coverage against loss or damage sustained or incurred by reason of the entry of a final, non-appealable judgment by a court of competent jurisdiction determining that the insured does not have the right to obtain a fee simple title to the Land under the Contract terms, provided that the insured shall have complied with all of the terms and conditions thereof.
NJRB 5-163 New Jersey Options Endorsement: This endorsement may be issued with a Loan Policy or Owner's Policy. The charge for issuance of this endorsement is 10% of the underwriting charge, with a minimum of $100. When affixed to a policy, this endorsement provides insurance against loss or damage sustained or incurred by reason of the entry of a final, non-appealable judgment by a court of competent jurisdiction determining that the insured does not have the right to obtain a fee simple title to the Land under the terms of said option, provided that the Insured shall have complied with all of the terms and conditions thereof.
Pricing for all endorsements is determined by the Rate Manual.
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