Missouri Statute | Act | Code |Business And Financial Institutions| US Code - US Statute

1. Sections 381.003 to 381.125 shall be known and may be cited
as the "Missouri Title Insurance Act".

2. Sections 381.009 to 381.048 shall apply to all persons engaged in the
business of title insurance in this state. Sections 381.052 to 381.112
shall apply to all title insurers engaged in the business of title
insurance in this state. Sections 381.115 to 381.125 shall apply to all
title agencies engaged in the business of title insurance in this state.

3. Except as otherwise expressly provided in this chapter and except
where the context otherwise requires, all provisions of the insurance
code applying to insurance and insurance companies generally shall apply
to title insurance, title insurers and title agents. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

As used in this chapter, the following terms mean:

(1) "Abstract of title" or "abstract", a written history, synopsis or
summary of the recorded instruments affecting the title to real property;

(2) "Affiliate", a specific person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under
common control with, the person specified;

(3) "Affiliated business", any portion of a title insurance agency's
business written in this state that was referred to it by a producer of
title insurance business or by an associate of the producer, where the
producer or associate, or both, have a financial interest in the title
agency;

(4) "Associate", any:

(a) Business organized for profit in which a producer of title business
is a director, officer, partner, employee or an owner of a financial
interest;

(b) Employee of a producer of title business;

(c) Franchisor or franchisee of a producer of title business;

(d) Spouse, parent or child of a producer of title insurance business who
is a natural person;

(e) Person, other than a natural person, that controls, is controlled by,
or is under common control with, a producer of title business;

(f) Person with whom a producer of title insurance business or any
associate of the producer has an agreement, arrangement or understanding,
or pursues a course of conduct, the purpose or effect of which is to
provide financial benefits to that producer or associate for the referral
of business;

(5) "Bona fide employee of the title insurer", an individual who devotes
substantially all of his or her time to performing services on behalf of
a title insurer and whose compensation for those services is in the form
of salary or its equivalent paid by the title insurer;

(6) "Control", including the terms "controlling", "controlled by" and
"under common control with", the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of
a person, whether through the ownership of voting securities, by contract
other than a commercial contract for goods or nonmanagement services, or
otherwise, unless the power is the result of an official position or
corporate office held by the person. Control shall be presumed to exist
if a person, directly or indirectly, owns, controls, holds with the power
to vote or holds proxies representing ten percent or more of the voting
securities of another person. This presumption may be rebutted by showing
that control does not exist in fact. The director may determine, after
furnishing all persons in interest notice and opportunity to be heard and
making specific findings of fact to support the determination, that
control exists in fact, notwithstanding the absence of a presumption to
that effect;

(7) "County" or "counties" includes any city not within a county;

(8) "Direct operations", that portion of a title insurer's operations
which are attributable to business written by a bona fide employee;

(9) "Director", the director of the department of insurance, or the
director's representatives;

(10) "Escrow", written instruments, money or other items deposited by one
party with a depository, escrow agent or escrowee for delivery to another
party upon the performance of a specified condition or the happening of a
certain event;

(11) "Escrow, settlement or closing fee", the consideration for
supervising or handling the actual execution, delivery or recording of
transfer and lien documents and for disbursing funds;

(12) "Financial interest", a direct or indirect legal or beneficial
interest, where the holder is or will be entitled to five percent or more
of the net profits or net worth of the entity in which the interest is
held;

(13) "Foreign title insurer", any title insurer incorporated or organized
pursuant to the laws of any other state of the United States, the
District of Columbia, or any other jurisdiction of the United States;

(14) "Geographically indexed or retrievable", a system of keeping
recorded documents which includes as a component a method for discovery
of the documents by:

(a) Searching an index arranged according to the description of the
affected land; or

(b) An electronic search by description of the affected land;

(15) "Net retained liability", the total liability retained by a title
insurer for a single risk, after taking into account any ceded liability
and collateral, acceptable to the director, and maintained by the insurer;

(16) "Non-United States title insurer", any title insurer incorporated or
organized pursuant to the laws of any foreign nation or any province or
territory;

(17) "Premium", the consideration paid by or on behalf of the insured for
the issuance of a title insurance policy or any endorsement or special
coverage. It does not include consideration paid for settlement or escrow
services or noninsurance-related information services;

(18) "Producer", any person, including any officer, director or owner of
five percent or more of the equity or capital of any person, engaged in
this state in the trade, business, occupation or profession of:

(a) Buying or selling interests in real property;

(b) Making loans secured by interests in real property; or

(c) Acting as broker, agent, representative or attorney of a person who
buys or sells any interest in real property or who lends or borrows money
with the interest as security;

(19) "Qualified depository institution", an institution that is:

(a) Organized or, in the case of a United States branch or agency office
of a foreign banking organization, licensed pursuant to the laws of the
United States or any state and has been granted authority to operate with
fiduciary powers;

(b) Regulated, supervised and examined by federal or state authorities
having regulatory authority over banks and trust companies;

(c) Insured by the appropriate federal entity; and

(d) Qualified under any additional rules established by the director;

(20) "Referral", the directing or the exercising of any power or
influence over the direction of title insurance business, whether or not
the consent or approval of any other person is sought or obtained with
respect to the referral;

(21) "Search", "search of the public records" or "search of title", a
search of those records established by the laws of this state for the
purpose of imparting constructive notice of matters relating to real
property to purchasers for value and without knowledge;

(22) "Security" or "security deposit", funds or other property received
by the title insurer as collateral to secure an indemnitor's obligation
under an indemnity agreement pursuant to which the insurer is granted a
perfected security interest in the collateral in exchange for agreeing to
provide coverage in a title insurance policy for a specific title
exception to coverage;

(23) "Subsidiary", an affiliate controlled by a person directly or
indirectly through one or more intermediaries;

(24) "Title agency" means an authorized person who issues title insurance
on behalf of a title insurer. An attorney licensed to practice law in
this state who issues title insurance as a part of his or her law
practice, but does not maintain or operate a title insurance business
separate from such law practice is not a title agency;

(25) "Title agent" or "agent", an attorney licensed to practice law in
this state who issues title insurance as part of his or her law practice,
but who is not affiliated with or acting on behalf of a title agency, or
an authorized person who, on behalf of a title agency or on behalf of a
title agent not affiliated with a title agency, performs one or more of
the following acts in conjunction with the issuance of a title insurance
commitment or policy:

(a) Determines insurability, based upon a review of a search of title;

(b) Performs searches;

(c) Handles escrows, settlements or closings; or

(d) Solicits or negotiates title insurance business;

(26) "Title insurance business" or "business of title insurance":

(a) Issuing as insurer or offering to issue as insurer a title insurance
policy;

(b) Transacting or proposing to transact by a title insurer any of the
following activities when conducted or performed in contemplation of and
in conjunction with the issuance of a title insurance policy:

a. Soliciting or negotiating the issuance of a title insurance policy;

b. Guaranteeing, warranting or otherwise insuring the correctness of
title searches for all instruments affecting titles to real property, any
interest in real property, cooperative units and proprietary leases and
for all liens or charges affecting the same;

c. Handling of escrows, settlements or closings;

d. Executing title insurance policies;

e. Effecting contracts of reinsurance; or

f. Abstracting, searching or examining titles;

(c) Guaranteeing, warranting or insuring searches or examinations of
title to real property or any interest in real property;

(d) Guaranteeing or warranting the status of title as to ownership of or
liens on real property by any person other than the principals to the
transaction;

(e) Promising to purchase or repurchase for consideration an indebtedness
because of a title defect, whether or not involving a transfer of risk to
a third person; or

(f) Promising to indemnify the holder of a mortgage or deed of trust
against loss from the failure of the borrower to pay the mortgage or deed
of trust when due if the property fails to yield sufficient proceeds upon
foreclosure to satisfy the debt, when one or both of the following
conditions exist:

a. The security has been impaired by the discovery of a previously
unknown property interest in favor of one who is not liable for the
payment of the mortgage or deed of trust; or

b. Perfection of the position of the mortgage or deed of trust which was
assured to exist cannot be obtained, notwithstanding timely recordation
with the recorder of deeds of the county in which the property is
located; or

(g) Doing or proposing to do any business substantially equivalent to any
of the activities listed in this subdivision in a manner designed to
evade the provisions of this chapter;

(27) "Title insurance commitment" or "commitment", a preliminary report,
commitment or binder issued prior to the issuance of a title insurance
policy containing the terms, conditions, exceptions and other matters
incorporated by reference under which the title insurer is willing to
issue its title insurance policy. A title insurance commitment is not an
abstract of title;

(28) "Title insurance policy" or "policy", a contract insuring or
indemnifying owners of, or other persons lawfully interested in, real
property or any interest in real property, against loss or damage arising
from any or all of the following conditions existing on or before the
policy date and not excepted or excluded:

(a) Title to the estate or interest in land being otherwise than as
stated in the policy;

(b) Defects in or liens or encumbrances on the insured title;

(c) Unmarketability of the insured title;

(d) Lack of legal right of access to the land;

(e) Invalidity or unenforceability of the lien of an insured mortgage;

(f) The priority of a lien or encumbrance over the lien of any insured
mortgage;

(g) The lack of priority of the lien of an insured mortgage over a
statutory lien for services, labor or material;

(h) The invalidity or unenforceability of an assignment of the insured
mortgage; or

(i) Rights or claims relating to the use of or title to the land;

(29) "Title insurer" or "insurer", a company organized pursuant to laws
of this state for the purpose of transacting the business of title
insurance and any foreign or non-United States title insurer licensed in
this state to transact the business of title insurance;

(30) "Title plant", a set of records encompassing at least the most
recent forty-five years, consisting of documents, maps, surveys or
entries affecting title to real property or any interest in or
encumbrance on the property, which have been filed or recorded in the
jurisdiction for which the title plant is established or maintained. The
records in the title plant shall be geographically indexed or retrievable
as to those records containing a legal description of affected land, and
otherwise by name of affected person;

(31) "Underwrite", the authority to accept or reject risk on behalf of
the title insurer. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. When a title insurance commitment issued by a title insurer,
title agency or title agent includes an offer to issue an owner's policy
covering the resale of owner-occupied residential property, the
commitment shall incorporate the following statement in bold type:

"Please read the exceptions and the terms shown or referred to herein
carefully. The exceptions are meant to provide you with notice of matters
which are not covered under the terms of the title insurance policy and
should be carefully considered."

2. A title insurer, title agency or title agent issuing a lender's title
insurance policy in conjunction with a mortgage loan made simultaneously
with the purchase of all or part of the real estate securing the loan,
where no owner's title insurance policy has been requested, shall give
written notice, on a form prescribed or approved by the director, to the
purchaser-mortgagor at the time the commitment is prepared. The notice
shall explain that a lender's title insurance policy is to be issued
protecting the mortgage-lender, and that the policy does not provide
title insurance protection to the purchaser-mortgagor as the owner of the
property being purchased. The notice shall explain what a title policy
insures against and what possible exposures exist for the purchaser-
mortgagor that could be insured against through the purchase of an
owner's policy. The notice shall also explain that the
purchaser-mortgagor may obtain an owner's title insurance policy
protecting the property owner at a specified cost or approximate cost, if
the proposed coverages are or amount of insurance is not then known. A
copy of the notice, signed by the purchaser-mortgagor, shall be retained
in the relevant underwriting file at least fifteen years after the
effective date of the policy.

3. Each violation of any provision of this section is a class C violation
as that term is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. The title insurer shall not allow the issuance of its
commitments or policies by a title agency or title agent not affiliated
with a title agency unless there is in force a written contract between
the parties which sets forth the responsibilities of each party or, where
both parties share responsibility for particular functions, specifies the
division of responsibilities.

2. For each title agency or title agent not affiliated with a title
agency under contract with the insurer, the title insurer shall have on
file a statement of financial condition, of each title agency or title
agent as of the end of the previous calendar or fiscal year setting forth
an income statement of business done during the preceding year and a
balance sheet showing the condition of its affairs as of the close of the
prior year, certified by the agency or agent as being a true and accurate
representation of the agency's or agent's financial condition. The
statement shall be filed with the insurer no later than the date the
agency's or agent's federal income tax return for the same year is filed.
Attorneys actively engaged in the practice of law, in addition to that
related to title insurance business, are exempt from the requirements of
this subsection.

3. The title insurer shall conduct reviews of the underwriting, claims
and escrow practices of its agencies and agents which shall include a
review of the agency's or agent's policy blank inventory and processing
operations. If any such title agency or title agent does not maintain
separate bank or trust accounts for each title insurer it represents, the
title insurer shall verify that the funds held on its behalf are
reasonably ascertainable from the books of account and records of the
title agency or title agent not affiliated with a title agency. The title
insurer shall conduct a review of each of its agencies and agents at
least triennially commencing January first of the year first following
January 1, 2001.

4. Within thirty days of executing or terminating a contract with a title
agency or title agent not affiliated with a title agency, the insurer
shall provide notification of the appointment or termination and the
reason for termination to the director. Notices of appointment of a title
agency or title agent shall be made on a form promulgated by the director.

5. The title insurer shall maintain an inventory of all policy numbers
allocated to each title agency or title agent not affiliated with a title
agency.

6. The title insurer shall have on file proof that the title agency or
title agent is licensed by this state.

7. The title insurer shall establish the underwriting guidelines and,
where applicable, limitations on title claims settlement authority to be
incorporated into contracts with its title agencies and title agents not
affiliated with a title agency.

8. Each violation of any provision of this section is a class B violation
as that term is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A title insurer, title agency or title agent not affiliated
with a title agency may operate as an escrow, security, settlement or
closing agent, provided that:

(1) All funds deposited with the title insurer, title agency or title
agent not affiliated with a title agency in connection with any escrow,
settlement, closing or security deposit shall be submitted for collection
to or deposited in a separate fiduciary trust account or accounts in a
qualified depository institution no later than the close of the next
business day after receipt, in accordance with the following requirements:

(a) The funds shall be the property of the person or persons entitled to
them under the provisions of the escrow, settlement, security deposit or
closing agreement and shall be segregated for each depository by escrow,
settlement, security deposit or closing in the records of the title
insurer, title agency or title agent not affiliated with a title agency,
in a manner that permits the funds to be identified on an individual
basis and in accordance with the terms of the individual instructions or
agreements under which the funds were accepted; and

(b) The funds shall be applied only in accordance with the terms of the
individual instructions or agreements under which the funds were accepted;

(2) Funds held in an escrow account shall be disbursed only pursuant to a
written instruction or agreement specifying under what conditions and to
whom such funds may be disbursed or pursuant to an order of a court of
competent jurisdiction;

(3) Funds held in a security deposit account shall be disbursed only
pursuant to a written agreement specifying:

(a) What actions the indemnitor shall take to satisfy his or her
obligation under the agreement;

(b) The duties of the title insurer, title agency or title agent not
affiliated with a title agency with respect to disposition of the funds
held, including a requirement to maintain evidence of the disposition of
the title exception before any balance may be paid over to the depositing
party or his or her designee; and

(c) Any other provisions the director may require;

(4) Any interest received on funds deposited in connection with any
escrow, settlement, security deposit or closing may be retained by the
title insurer, title agency or title agent not affiliated with a title
agency as compensation for administration of the escrow or security
deposit, unless the instructions for the funds or a governing statute
provides otherwise;

(5) Each violation of this subsection is a class A violation as that term
is defined in section 381.045.

2. The title agency or title agent not affiliated with an agency shall
cooperate with its underwriters in the conduct by the underwriters of
reviews of the agency's or agent's escrow, settlement, closing and
security deposit accounts. The title insurer shall provide a copy of the
report of each such review it performs to the director. The director may
promulgate rules setting forth the minimum threshold level at which a
review would be required, the standards thereof and the form of report
required.

3. If the title agency or title agent not affiliated with an agency is
appointed by two or more title insurers and maintains fiduciary trust
accounts in connection with providing escrow or closing settlement
services, the title agency or title agent shall allow each title insurer
reasonable access to the accounts and any or all of the supporting
account information in order to ascertain the safety and security of the
funds held by the title agency or title agent.

4. (1) Nothing in this chapter shall be deemed to prohibit the recording
of documents prior to the time funds are available for disbursement with
respect to a transaction in which a title insurer, title agency or title
agent not affiliated with a title agency is the settlement agent,
provided all parties to whom payment will become due upon such recording
consent thereto in writing.

(2) The settlement agent shall record all deeds and security instruments
for real estate closings handled by it within three business days after
completion of all conditions precedent thereto.

(3) Each violation of this subsection is a class C violation as that term
is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A title insurer, title agency, title agent or other person
shall not give or receive, directly or indirectly, any consideration for
the referral of title insurance business or escrow or other service
provided by a title insurer, title agency or title agent. Each violation
of this subsection is a class A violation as that term is defined in
section 381.045.

2. Any title insurer, title agency or title agent doing business in the
same county as a title insurer, title agency or title agent who may be in
violation of the prohibitions or limitations of this section shall have
standing to seek injunctive relief against the violating title insurer,
title agency or title agent in the event the department declines or fails
to enforce this section within forty-five days following receipt of
written notice of such violation. In any action pursuant to this
subsection, the court may award to the successful party the court costs
of the action together with reasonable attorney fees. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

No title insurer, title agency or title agent shall participate
in any transaction in which it knows that a producer or other person
requires, directly or indirectly, or through any trustee, director,
officer, agent, employee or affiliate, as a condition, agreement or
understanding to selling or furnishing any other person a loan, or loan
extension, credit, sale, property, contract, lease or service, that the
other person shall place a title insurance policy of any kind with the
title insurer or through a particular title agency or agent. Each
violation of this section is a class A violation as that term is defined
in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. No title insurer, may charge any rates regulated by the state
after January 1, 2001, except in accordance with the premium rate
schedule and manual filed with and approved by the director in accordance
with applicable statutes and regulations governing rate filings. Premium
rate schedules in effect prior to January 1, 2001, may be used until new
rate schedules have been approved by the director. Title insurers shall
file their premium rate schedules within thirty days after January 1,
2001. Each violation of this subsection is a class C violation as that
term is defined in section 381.045. Nothing in this section shall prevent
an agent not affiliated with an agency from charging for services that
constitute the practice of law at the customary fee charged by such
person for legal services. To the extent the premium fails to compensate
the agent at such rate, the agent may render an additional bill for such
services on behalf of the agent's law practice or law firm. The
acceptance of any part of the premium by the law firm of said agent shall
not be a violation of any provision of the Missouri title insurance act
or the general insurance statutes, regulations or bulletins regarding
payment of commissions to nonlicensed entities.

2. The director may establish rules, including rules providing
statistical plans, for use by all title insurers, title agencies and
title agents in the recording and reporting of revenue, loss and expense
experience in such form and detail as is necessary to aid the director in
the establishment of rates and fees.

3. The director may require that the information provided pursuant to
this section be verified by oath of the insurer's or agency's president
or vice president or secretary or actuary, as applicable. The director
may further require that the information required pursuant to this
section be subject to an audit conducted at the expense of the title
insurer or title agency by an independent certified public accountant.
The director shall have the authority to establish a minimum threshold
level at which an audit would be required.

4. Information filed with the director relating to the experience of a
particular agency shall be kept confidential unless the director finds it
in the public interest to disclose the information required of title
insurers or title agencies pursuant to this section. Prior to any such
disclosure of confidential information, the director shall provide notice
and opportunity to be heard to the title insurers and title agencies who
would be affected thereby. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

No title insurance company, title agency or title agent shall
willfully withhold information from, or knowingly give false or
misleading information to the director, or to any title insurance rating
organization, of which the title insurance company is a member or
subscriber, which will affect the rates or fees chargeable pursuant to
this chapter. Each violation of this section is a class A violation as
that term is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Evidence of the examination of title and determination of
insurability generated by a title insurer engaged in direct operations,
title agency or title agent shall be preserved and maintained by such
insurer, agency or agent for as long as appropriate to the circumstances
but in no event less than fifteen years after the title insurance policy
has been issued.

2. Records relating to escrow and security deposits shall be preserved
and retained by a title insurer engaged in direct operations, title
agency and title agent for as long as appropriate to the circumstances
but in no event less than five years after the escrow or security deposit
account has been closed.

3. This section shall not apply to a title insurer acting as coinsurer if
one of the other coinsurers has complied with this section.

4. Each violation of any provision of this section is a class C violation
as that term is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. The director may issue rules, regulations and orders
necessary to carry out the provisions of this chapter.

2. No rule or portion of a rule promulgated pursuant to the authority of
this chapter shall become effective unless it has been promulgated
pursuant to the provisions of chapter 536, RSMo. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. If the director determines that the title insurer or any
other person has violated this chapter, or any regulation or order
promulgated thereunder, after notice and opportunity to be heard, the
director may order:

(1) For each violation a monetary penalty which shall take into account
the harm the violation caused or could have caused or potential harm to
the public and which shall not exceed:

(a) One thousand dollars per violation for a class A violation;

(b) Five hundred dollars per violation for a class B violation; and

(c) One hundred dollars per violation for a class C violation;

(2) Revocation or suspension of the title insurer's license; or

(3) Both monetary penalty and revocation or suspension.

2. Nothing contained in this section shall affect the right of the
director to impose any other penalties provided for in the insurance code.

3. Nothing contained in this chapter is intended to or shall in any other
manner limit or restrict the rights of policyholders, claimants and
creditors. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

The director may bring an action in a court of competent
jurisdiction to enjoin violations of the Real Estate Settlement
Procedures Act, 12 U.S.C. Section 2607, as amended. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

No person other than a domestic, foreign or non-United States
title insurer organized on the stock plan and duly licensed by the
director shall transact title insurance business as an insurer in this
state. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

Subject to the exceptions and restrictions contained in this
chapter, a title insurer shall have the power to:

(1) Do only title insurance business;

(2) Reinsure title insurance policies; and

(3) Perform ancillary activities, unless prohibited by the director,
including examining titles to real property and any interest in real
property and procuring and furnishing related information and information
about relevant personal property, when not in contemplation of, or in
conjunction with, the issuance of a title insurance policy. (L. 2000 S.B.
894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. No insurer that transacts any class, type or kind of business
other than title insurance shall be eligible for the issuance or renewal
of a license to transact the business of title insurance in this state
nor shall title insurance be transacted, underwritten or issued by any
insurer transacting or licensed to transact any other class, type or kind
of business.

2. A title insurer shall not engage in the business of guaranteeing
payment of the principal or the interest of bonds or mortgages.

3. (1) Notwithstanding subsection 1 of this section, and to the extent
such coverage is lawful within this state, a title insurer is expressly
authorized to issue closing or settlement protection to a proposed
insured upon request if the title insurer issues a commitment, binder or
title insurance policy. Such closing or settlement protection shall
conform to the terms of coverage and form of instrument as required by
the director and may indemnify a proposed insured solely against loss of
settlement funds only because of the following acts of a title insurer's
named title agency or title agent:

(a) Theft of settlement funds; and

(b) Failure to comply with written closing instructions by the proposed
insured when agreed to by the title agency or title agent relating to
title insurance coverage.

(2) The director may promulgate or approve a required charge for
providing the coverage.

(3) A title insurer shall not provide any other coverage which purports
to indemnify against improper acts or omissions of a person with regard
to escrow, settlement, or closing services. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

Before being licensed to do an insurance business in this state,
a title insurer shall establish and maintain a minimum paid-in capital of
not less than four hundred thousand dollars and, in addition, paid-in
initial surplus of at least four hundred thousand dollars. (L. 2000 S.B.
894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. The net retained liability of a title insurer for a single
risk in regard to property located in this state, whether assumed
directly or as reinsurance, shall not exceed the aggregate of fifty
percent of surplus as regards policyholders plus the statutory premium
reserve less the company's investment in title plants, all as shown in
the most recent annual statement of the insurer on file with the director.

2. For purposes of this chapter:

(1) A single risk shall be the insured amount of any title insurance
policy, except that, where two or more title insurance policies are
issued simultaneously covering different estates in the same real
property, a single risk shall be the sum of the insured amounts of all
the title insurance policies; and

(2) A policy under which a claim payment reduces the amount of insurance
under one or more other title insurance policies shall be included in
computing the single risk sum only to the extent that its amount exceeds
the aggregate amount of the policy or policies whose amount of insurance
is reduced.

3. A title insurer may obtain reinsurance for all or any part of its
liability under its title insurance policies or reinsurance agreements
and may also reinsure title insurance policies issued by other title
insurers on single risks located in this state or elsewhere. Reinsurance
on policies issued on properties located in this state may be obtained
from any title insurers licensed to transact title insurance business in
this state, any other state, or the District of Columbia and which have a
combined capital and surplus of at least eight hundred thousand dollars.

4. The director may waive the limitation of this section for a particular
risk upon application of the title insurer and for good cause shown. (L.
2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

In determining the financial condition of a title insurer doing
business pursuant to this chapter, the general investment provisions of
sections 376.300 to 376.305, RSMo, shall apply; except that, an
investment in a title plant or plants in an amount equal to the actual
cost shall be allowed as an admitted asset for title insurers. The
aggregate amount of the investment shall not exceed fifty percent of
surplus to policyholders, as shown on the most recent annual statement of
the title insurer on file with the director. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. No title insurance policy shall be written unless and until
the title insurer, title agent, or agency has:

(1) Caused a search of title to be made from the evidence prepared from a
title plant of the county where the property is located as herein
defined, or if no such title plant of the county exists, or the owner of
such plant refuses to furnish the title insurer, title agent, or agency
desiring to insure, such title evidence at a reasonable charge and within
a reasonable period of time, then such policy of title insurance shall be
based upon the best title evidence available. An attorney licensed to
practice law in this state may upon personal inspection use the best
evidence available in any county and is not subject to the provisions of
the title plant requirement of sections 381.011 to 381.241. The records
on which the title plant is based on shall show all prior matters
affecting the title to the property or interest therein for a continuous
period of time of at least:

(a) The past ten years, by two years after September 28, 1987;

(b) The past fifteen years, by three years after September 28, 1987;

(c) The past twenty years, by four years after September 28, 1987; and

(d) The past twenty-seven years, by five years after September 28, 1987;
and

(2) Caused to be made a determination of insurability of title in
accordance with sound underwriting practices.

2. Except when allowed by regulations promulgated by the director, no
title insurer, title agent, or agency shall knowingly issue any owner's
title insurance policy or commitment to insure without showing all
outstanding, enforceable recorded liens or other interests against the
title which is to be insured.

3. Evidence of the examination of title and determination of insurability
shall be preserved and retained in the files of the title insurer or its
title agent or agency for a period of not less than fifteen years after
the title insurance policy has been issued. Instead of retaining the
original evidence, the title insurer or title agent or agency may in the
regular course of business establish a system whereby all or part of the
evidence is recorded, copied, or reproduced by any process that
accurately and legibly reproduces or forms a durable medium for
reproducing the contents of the original.

4. This section shall not apply to:

(1) A title insurer assuming liability through a contract of reinsurance;

(2) A title insurer acting as coinsurer if one of the other coinsuring
title insurers has complied with this section; or

(3) Policies of title insurance issued prior to the expiration of one
year after September 28, 1987. (L. 1987 S.B. 251 § 9, A.L. 1988 S.B. 798)

In determining the financial condition of a title insurer doing
business pursuant to this chapter, the general provisions of the
insurance code requiring the establishment of reserves sufficient to
cover all known and unknown liabilities including allocated and
unallocated loss adjustment expense, shall apply; except that, a title
insurer shall establish and maintain:

(1) (a) A known claim reserve in an amount estimated to be sufficient to
cover all unpaid losses, claims and allocated loss adjustment expenses
arising under title insurance policies for which the title insurer may be
liable, and for which the insurer has discovered or received notice by or
on behalf of the insured or escrow or security depositor;

(b) Upon receiving notice from or on behalf of the insured of a title
defect in or lien or adverse claim against the title of the insured that
may result in a loss or cause expense to be incurred in the proper
disposition of the claim, the title insurer shall determine the amount to
be added to the reserve, which amount shall reflect a careful estimate of
the loss or loss expense likely to result by reason of the claim;

(c) Reserves required pursuant to this section may be revised from time
to time and shall be redetermined at least once each year;

(2) A statutory or unearned premium reserve established and maintained as
follows:

(a) A domestic title insurer shall establish and maintain an unearned
premium reserve computed in accordance with this section, and all sums
attributed to such reserve shall at all times and for all purposes be
considered and constitute unearned portions of the original premiums.
This reserve shall be reported as a liability of the title insurer in its
financial statements;

(b) The unearned premium reserve shall be maintained by the title insurer
for the protection of holders of title insurance policies. Except as
provided in this section, assets equal in value to the reserve are not
subject to distribution among creditors or stockholders of the title
insurer until all claims of policyholders or claims under reinsurance
contracts have been paid in full, and all liability on the policies or
reinsurance contracts has been paid in full and discharged or lawfully
reinsured;

(c) The unearned premium reserve shall consist of:

a. The amount of the unearned premium reserve on January 1, 2001; and

b. A sum equal to fifteen cents for each one thousand dollars of net
retained liability under each title insurance policy, excluding
mortgagee's policies simultaneously issued with owner's policies or
owner's leasehold policies of the same or greater amount, on a single
risk written on properties located in this state and issued after January
1, 2001;

(d) Amounts placed in the unearned premium reserve in any year in
accordance with paragraph (c) of this subdivision shall be deducted in
determining the net profit of the title insurer for that year;

(e) A title insurer shall release from the unearned premium reserve a sum
equal to ten percent of the amount added to the reserve during a calendar
year on July first of each of the five years following the year in which
the sum was added, and shall release from the unearned premium reserve a
sum equal to three and one-third percent of the amount added to the
reserve during that year on each succeeding July first until the entire
amount for that year has been released. The amount of the unearned
premium reserve or similar unearned premium reserve maintained before
January 1, 2001, shall be released in accordance with the law in effect
immediately before January 1, 2001;

(f) a. Each domestic and foreign title insurer shall file annually with
the audited financial report required pursuant to section 375.1032, RSMo,
an actuarial certificate made by a member in good standing of the
American Academy of Actuaries, or by an actuary permitted to make such
certificate by the commissioner, superintendent or director of the
department of insurance of the state of incorporation of a foreign title
insurer;

b. The actuarial certification shall conform to the annual statement
instructions for title insurers adopted by the National Association of
Insurance Commissioners and shall include the actuary's professional
opinion of the insurer's reserves as of the date of the annual statement.
The reserves analyzed pursuant to this section shall include reserves for
known claims, including adverse developments on known claims, and
reserves for incurred but not reported claims;

(g) a. Each domestic and foreign title insurer shall establish a
supplemental reserve in the amount by which the actuarially certified
reserves exceed the total of the known claim reserve and statutory
premium reserve as set forth in the title insurer's annual financial
report, subject to this subdivision;

b. The supplemental reserve required pursuant to this section shall be
phased in as follows:

i. Twenty-five percent of the otherwise applicable supplemental reserve
is required until December thirty-first of the year next following
January 1, 2001;

ii. Fifty percent of the otherwise applicable supplemental reserve is
required until December thirty-first of the second year following January
1, 2001;

iii. Seventy-five percent of the otherwise applicable supplemental
reserve is required until December thirty-first of the third year
following January 1, 2001;

iv. One hundred percent of the supplemental reserve is required after
December thirty-first of the fourth year following January 1, 2001. (L.
2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Sections 375.570 to 375.750, RSMo, and sections 375.1150 to
375.1246, RSMo, shall apply to all title insurers subject to the title
insurance act, except as otherwise provided in this section. In applying
such sections, the court shall consider the unique aspects of title
insurance and shall have broad authority to fashion relief that provides
for the maximum protection of the title insurance policyholders.

2. Security and escrow funds held by or on behalf of the title insurer
shall not become general assets and shall be administered as secured
claims as defined in section 375.1152, RSMo.

3. Title insurance policies that are in force at the time an order of
liquidation is entered shall not be canceled except upon a showing to the
court of good cause by the liquidator. The determination of good cause
shall be within the discretion of the court. In making this
determination, the court shall consider the unique aspects of title
insurance and all other relevant circumstances.

4. The court may set appropriate dates that potential claimants must file
their claims with the liquidator. The court may set different dates for
claims based upon the title insurance policy than for all other claims.
In setting dates, the court shall consider the unique aspects of title
insurance and all other relevant circumstances.

5. As of the date of the order of insolvency or liquidation, all premiums
paid, due or to become due under policies of the title insurers, shall be
fully earned. It shall be the obligation of title agencies, title agents,
insureds or representatives of the title insurer to pay fully earned
premium to the liquidator or rehabilitator. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

A title insurer shall only declare or distribute a dividend to
shareholders with the prior written approval of the director, as would be
permitted pursuant to subdivision (1) of subsection 1 of section 382.210,
RSMo. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A title insurer or authorized rate service organization shall
not deliver or issue for delivery or permit any of its authorized title
agencies or title agents to deliver in this state, any form, in
connection with title insurance written, unless it has been filed with
the director and approved by the director or thirty days have elapsed and
it has not been disapproved as misleading or violative of public policy.
Each violation of this subsection is a class C violation as that term is
defined in section 381.045.

2. Forms covered by this section shall include:

(1) Title insurance policies, including standard form endorsements; and

(2) Title insurance commitments issued prior to the issuance of a title
insurance policy.

3. After notice and opportunity to be heard are given to the insurer or
rate service organization which submitted a form for approval, the
director may withdraw approval of the form on finding that the use of the
form is contrary to the legal requirements applicable at the time of
withdrawal. The effective date of withdrawal of approval shall not be
less than ninety days after notice of withdrawal is given.

4. Any term or condition related to an insurance coverage provided by an
approved title insurance policy or any exception to the coverage, except
those ascertained from a search and examination of records relating to a
title or inspection or survey of a property to be insured, may only be
included in the policy after the term, condition or exception has been
filed with the director and approved as herein provided. (L. 2000 S.B.
894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A title insurer may satisfy its obligation to file premium
rates, rating manuals and forms as required by this chapter by becoming a
member of, or a subscriber to, a rate service organization, organized and
licensed pursuant to the provisions of this chapter, where the
organization makes the filings, and by authorizing the director in
writing to accept the filings on the insurer's behalf.

2. Nothing in this chapter shall be construed as requiring any title
insurer, title agency or title agent to become a member of, or a
subscriber to, any rate service organization. Nothing in this chapter
shall be construed as prohibiting the filing of deviations from rate
service organization filings by any member or subscriber. (L. 2000 S.B.
894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Every title insurer that shall propose its own premium rates
and every title insurance rating organization shall propose premium rates
that are not excessive nor inadequate for the safety and soundness of any
title insurer, which do not unfairly discriminate between risks in this
state which involve essentially the same exposure to loss and expense
elements, and which shall give due consideration to the following matters:

(1) The desirability for stability and responsiveness of rate structures;

(2) The necessity of assuring the financial solvency of title insurance
companies in periods of economic depression;

(3) The necessity for paying dividends on the capital stock of title
insurance companies sufficient to induce capital to be invested therein;
and

(4) A reasonable level of profit for the insurer.

2. Every title insurer that shall propose its own rates and every title
insurance rating organization may adopt basic classifications of policies
or contracts of title insurance which shall be used as the basis for
rates. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. If the director shall find in his review of rate filings that
the filings provide for, result in, or produce rates that are not
unreasonably high, and are not inadequate for the safeness and soundness
of the insurer, and are not unfairly discriminatory between risks in this
state involving essentially the same hazards and expense elements, the
director shall approve such rates. Prior to such approval the director
may conduct a public hearing with respect to a rate filing. An approval
shall continue in effect until the director shall issue an order of
disapproval pursuant to the requirements and procedure provided for in
subsections 2 and 3 of this section.

2. Upon the review at any time by the director of a rate filing, the
director shall, before issuing an order of disapproval, hold a hearing
upon not less than ten days' written notice, specifying in reasonable
detail the matters to be considered at such hearing, to every title
insurer and title insurance rating organization which made such filing,
and if, after such hearing, the director finds that such filing or a part
thereof does not meet the requirements of this chapter, the director
shall issue an order specifying in what respects the director finds that
it so fails, and stating when, within a reasonable period thereafter,
such filing or a part thereof shall be deemed no longer effective. A
title insurer or title insurance rating organization shall have the right
at any time to withdraw a filing or a part thereof, subject to the
provisions of section 381.102, in the case of deviation filing. Copies of
the order shall be sent to every title insurer and title insurance rating
organization affected. The order shall not affect any contract or policy
made or issued prior to the expiration of the period set forth in the
order.

3. Any person or organization aggrieved with respect to any filing which
is in effect may make written application to the director for a hearing
thereon. The title insurance company or title insurance rating
organization that made the filing shall not be authorized to proceed
pursuant to this subsection. Such application shall specify in reasonable
detail the grounds to be relied upon by the applicant. If the director
shall find that the application is made in good faith, that the applicant
would be so aggrieved if his or her grounds are established, and that
such grounds otherwise justify holding such a hearing, the director
shall, within thirty days after receipt of such application, hold a
hearing upon not less than ten days' written notice to the applicant and
to every title insurance company and title insurance rating organization
which made such a filing. If, after such hearing, the director finds that
the filing or a part thereof does not meet the requirements of this
chapter, the director shall issue an order specifying in what respects
the director finds that such filing or a part thereof fails to meet the
requirements of this chapter, stating when within a reasonable period
thereafter, such filing or a part thereof shall be deemed no longer
effective. Copies of such order shall be sent to the applicant and to
every such title insurer and title insurance rating organization. The
order shall not affect any contract or policy made or issued prior to the
expiration of the period set forth in the order. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A corporation, an unincorporated association, a partnership
or an individual, whether located within or outside this state, may make
application to the director for license as a rating organization for
title insurers, and shall file therewith:

(1) A copy of its constitution, its articles of agreement or association
or its certificate of incorporation, and of its bylaws, rules and
regulations governing the conduct of its business;

(2) A list of its members and subscribers;

(3) The name and address of a resident of this state upon whom notices or
orders of the director or process affecting such rating organization may
be served; and

(4) A statement of its qualifications as a title insurance rating
organization.

2. If the director finds that the applicant is competent, trustworthy and
otherwise qualified to act as a rating organization, and that its
constitution, articles of agreement or association or certificate of
incorporation, and its bylaws, rules and regulations governing the
conduct of its business, conform to requirements of law, the director
shall issue a license authorizing the applicant to act as a rating
organization for title insurance. Licenses issued pursuant to this
section shall remain in effect for three years unless sooner suspended or
revoked by the director or withdrawn by the licensee. The fee for such
license shall be one thousand five hundred dollars. Licenses issued
pursuant to this section may be suspended or revoked by the director,
after hearing upon notice, in the event the rating organization ceases to
meet the requirements of this subsection. Every rating organization shall
notify the director promptly of every change in:

(1) Its constitution, its articles of agreement or association or its
certificate of incorporation, and its bylaws, rules and regulations
governing the conduct of its business;

(2) Its list of members and subscribers; and

(3) The name and address of the resident of this state designated by it
upon whom notices or orders of the director or process affecting such
rating organization may be served.

3. Subject to rules and regulations which have been approved by the
director as reasonable, each title insurance rating organization shall
permit any title insurance company not a member to be a subscriber to its
rating services. Notices of proposed changes in such rules and
regulations shall be given to subscribers. Each such rating organization
shall furnish its rating services without discrimination to its members
and subscribers. The reasonableness of any rule or regulation in its
application to subscribers, or the refusal of any such rating
organization to admit a title insurance company as a subscriber, shall at
the request of any subscriber or any such title insurance company, be
reviewed by the director at a hearing held upon at least ten days'
written notice to such rating organization and to such subscriber. If the
director finds that such rule or regulation is unreasonable in its
application to subscribers, the director shall order that such rule or
regulation shall not be applicable to subscribers. If the rating
organization fails to grant or reject an application of a title insurance
company for subscribership within thirty days after it was made, the
title insurance company may request a review by the director as if the
application had been rejected. If the director finds that the title
insurance company has been refused admittance to the title insurance
rating organization as a subscriber without justification, the director
shall order such rating organization to admit the title insurance company
as a subscriber. If the director finds that the action of the title
insurance rating organization was justified, the director shall make an
order affirming its action. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

Every member of or subscriber to a title insurance rating
organization shall adhere to the filings made on its behalf by such
organization, except that any title insurance company which is a member
of or subscriber to such a rating organization may file with the director
a uniform percentage of decrease or increase to be applied to any or all
elements of the fees produced by the rating system so filed for a class
of title insurance which is found by the director to be a proper rating
unit for the application of such uniform decrease or increase, or to be
applied to the rates for a particular area, or otherwise deviate from the
rating plans, policy forms or other matters which are the subject of
filings pursuant to this chapter. Such deviation filing shall specify the
basis for the modification and shall be accompanied by the data or
historical pattern upon which the applicant relies. A copy of the
deviation filing and data shall be sent simultaneously to such rating
organization. Deviation filings shall be subject to the provisions of
section 381.095. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Any member of or subscriber to a title insurance rating
organization may appeal to the director from any action or decision of
such rating organization in approving or rejecting any proposed change in
or addition to the filings of such rating organization, and the director
shall, after a hearing held upon not less than ten days' written notice
to the appellant and to such rating organization, issue an order
approving the action or decision of such rating organization or directing
it to give further consideration to such proposal and to take action or
make a decision upon it within thirty days. If such appeal is from the
action or decision of the title insurance rating organization in
rejecting a proposed addition to its filings, the director may, in the
event the director finds that such action or decision was unreasonable,
issue an order directing the rating organization to make an addition to
its filings, on behalf of its members and subscribers, in a manner
consistent with the director's findings, within a reasonable time after
the issuance of such order. If the appeal is from the action of the title
insurance rating organization with regard to a rate or a proposed change
in or addition to its filings relating to the character and extent of
coverage, the director shall approve the action of the rating
organization or such modification thereof as shall have been suggested by
the appellant if either be made in accordance with this chapter.

2. The failure of a title insurance rating organization to take action or
make a decision within thirty days after submission to it of a proposal
pursuant to this section shall constitute a rejection of such proposal
within the meaning of this section. If such appeal is based upon the
failure of the rating organization to make a filing on behalf of such
member or subscriber which is based on a system of expense allocation
which differs from the system of expense allocation included in a filing
made by such rating organization, the director shall, if the director
grants the appeal, order the rating organization to make the requested
filing for use by the appellant. In deciding such appeal, the director
shall apply the standards set forth in section 381.032. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. The director shall promulgate reasonable rules and
statistical plans, reasonably adapted to each of the rating systems on
file with the department, which may be modified from time to time, and
which shall be used thereafter by each title insurer in the recording and
reporting of the composition of its business, its loss and countrywide
expense experience and those of its title insurance underwriters in order
that the experience of all title insurers* may be made available, at
least annually, in such form and detail as may be necessary to aid him or
her in determining whether rating systems comply with the standards set
forth in this chapter. Such rules and plans may also provide for the
recording of expense experience items which are specially applicable to
this state and are not susceptible of determination by a prorating of
countrywide expense experience. In promulgating such rules and plans, the
director shall give due consideration to the rating systems on file with
the department, and in order that such rules and plans may be as uniform
as is practicable among the several states, to the rules and to the form
of the plans used for such rating systems in other states. Such rules and
plans shall not place an unreasonable burden of expense on any title
insurer. No title insurer shall be required to record or report its
expense and loss experience on a classification basis that is
inconsistent with the rating system filed by it, nor shall any title
insurer be required to report the experience to any agency of which it is
not a member or subscriber. The director may designate one or more rating
organizations or other agencies to assist the director in gathering such
experience and making compilations thereof, and such compilations shall
be made available, subject to reasonable rules promulgated by the
director, to title insurers and rating organizations. The director shall
give preference in such designation to entities organized by and
functioning on behalf of title insurers operating in this state. If the
director, in his or her judgment, determines that one or more of such
organizations designated as statistical agents** is unable or unwilling
to perform its statistical functions according to reasonable requirements
established from time to time by the director, he or she may, after
consultation with such statistical agent and upon twenty days' notice to
any affected companies, designate another person to act on the director's
behalf in the gathering of statistical experience. The director shall in
such case establish the fee to be paid to such designated person by the
affected companies in order to pay the total cost of gathering and
compiling such experience. Agencies designated by the director shall
assist the director in making compilations of the reported data and such
compilations shall be made available, subject to reasonable rules and
regulations promulgated by the director, to insurers, rating
organizations and any other interested parties.

2. Reasonable rules and plans may be promulgated by the director for the
interchange of data necessary for the application of rating plans.

3. In order to further uniform administration of rate regulatory laws,
the director and every title insurer and rating organization may exchange
information and experience data with insurance supervisory officials,
title insurers and rating organizations in other states, and may consult
with them with respect to rate making and the application of rating
systems.

4. No rule or portion of a rule promulgated pursuant to the authority of
this section shall become effective unless it has been promulgated
pursuant to the provisions of chapter 536, RSMo. (L. 2000 S.B. 894)

Effective 1-1-01

*Word "insurer" appears in original rolls.

**Word "agent" appears in original rolls.

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

For purposes of the premium tax imposed by sections 148.320 and
148.340, RSMo, the premium income received by a title insurer shall mean
the amount of premium actually remitted to the title insurer and shall
exclude any amount of premium retained by the title agent within the
definition of "premium" contained in section 381.009. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A person shall not act in the capacity of a title agency or
title agent and a title insurer may not contract with any person to act
in the capacity of a title agency or title agent with respect to risks
located in this state unless the person is a licensed title agency or
title agent in this state.

2. An individual employed by a licensed title agency or title agent to
whom the agency or agent delegates authority to act on that agency's or
agent's behalf shall be either individually licensed or be named on the
employing agent's license if such employee performs any of the functions
defined in paragraph (a) of subdivision (25) of section 381.009. Each
person named on the license shall possess all qualifications determined
by the director to be appropriate. The director may adopt rules,
regulations, and requirements relating to licensing and practices of
persons acting in the capacity of title agencies or agents. These persons
may include title agencies, title agents, employees of either, and
persons acting on behalf of title agencies or title agents. This
subsection is not intended to include persons performing clerical
functions.

3. Every title agency licensed in this state shall:

(1) Exclude or eliminate the word insurer or underwriter from its
business name, unless the word agency is also included as part of the
name; and

(2) Provide, in a timely fashion, each title insurer with which it places
business any information the title insurer requests in order to comply
with reporting requirements of the director.

4. A title agency or title agent licensed in this state prior to the
effective date of this chapter shall have ninety days after the effective
date of this chapter to comply with the requirements of this section.

5. If the title agency or title agent delegates the title search to a
third party, such as an abstract company, the agency or agent must first
obtain proof that the third party is operating in compliance with rules
and regulations established by the director and the third party shall
provide the agency or agent and the insurer with access to and the right
to copy all accounts and records maintained by the third party with
respect to business placed with the title insurer. Proof from the third
party may consist of a signed statement indicating compliance, and shall
be effective for a three-year period. Each violation of this subsection
is a class C violation as that term is defined in section 381.045. (L.
2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Each title agent licensed to sell title insurance in this
state, unless exempt pursuant to subsection 8 of this section, shall
successfully complete courses of study as required by this section. Any
person licensed to act as a title agent shall, during each two years,
attend courses or programs of instruction or attend seminars equivalent
to a minimum of eight hours of instruction. The initial such two-year
period shall begin January first of the year next following the effective
date of this chapter.

2. Subject to approval by the director, the courses or programs of
instruction which shall be deemed to meet the director's standards for
continuing educational requirements shall include, but not be limited to,
the following:

(1) An insurance-related course taught by an accredited college or
university or qualified instructor who has taught a course of insurance
law at such institution;

(2) A course or program of instruction or seminar developed or sponsored
by any authorized insurer, recognized agents' association or insurance
trade association. A local agents' group may also be approved if the
instructor receives no compensation for services;

(3) Courses approved for continuing legal education credit by the
Missouri Bar.

3. A person teaching any approved course of instruction or lecturing at
any approved seminar shall qualify for the same number of classroom hours
as would be granted to a person taking and successfully completing such
course, seminar or program.

4. Excess classroom hours accumulated during any two-year period may be
carried forward to the two-year period immediately following the two-
year period in which the course, program or seminar was held.

5. For good cause shown, the director may grant an extension of time
during which the educational requirements imposed by this section may be
completed, but such extension of time shall not exceed the period of one
calendar year. The director may grant an individual waiver of the
mandatory continuing education requirement upon a showing by the licensee
that it is not feasible for the licensee to satisfy the requirements
prior to the renewal date. Waivers may be granted for reasons including,
but not limited to:

(1) Serious physical injury or illness;

(2) Active duty in the armed services for an extended period of time;

(3) Residence outside the United States; or

(4) Licensee is at least seventy years of age and is currently licensed
as a title agent.

6. Every person subject to the provisions of this section shall furnish
in a form satisfactory to the director, written certification as to the
courses, programs, or seminars of instruction taken and successfully
completed by such person. A filing fee shall be paid by the person
furnishing the report as determined by the director to be necessary to
cover the administrative cost related to the handling of such
certification reports, subject to the limitations imposed in subsection 9
of this section.

7. The provisions of this section shall not apply to those natural
persons holding or applying for a license to act as a title agent in
Missouri who reside in a state that has enacted and implemented a
mandatory continuing education law or regulation pertaining to * title
agents. However, those natural persons holding or applying for a Missouri
agent license who reside in states which have no mandatory continuing
education law or regulations shall be subject to all the provisions of
this section to the same extent as resident Missouri title agents.

8. Rules necessary to implement and administer this section shall be
promulgated by the director of the department of insurance, including,
but not limited to, rules regarding the following:

(1) The insurance advisory board established by section 375.019, RSMo,
shall be utilized by the director to assist the director in determining
acceptable content of courses, programs and seminars to include classroom
equivalency;

(2) Every applicant seeking approval by the director of a continuing
education course pursuant to this section shall pay to the director a
filing fee of fifty dollars per course, except that such total fee shall
not exceed two hundred fifty dollars per year for any single applicant.
Fees shall be waived for local agents' groups if the instructor receives
no compensation for services. Such fee shall accompany any application
form required by the director. Courses shall be approved for a period of
no more than one year. Applicants holding courses intended to be offered
for a longer period must reapply for approval;

(3) The director has the authority to determine the amount of the filing
fee to be paid by title agents at the time of license renewal, which
shall be set at an amount to produce revenue which shall not
substantially exceed the cost of administering this section, but in no
event shall such fee exceed ten dollars per biennial report filed.

9. All funds received pursuant to the provisions of this section shall be
transmitted by the director of the department of insurance to the
department of revenue for deposit in the state treasury to the credit of
the department of insurance dedicated fund. All expenditures necessitated
by this section shall be paid from funds appropriated from the department
of insurance dedicated fund by the legislature.

10. When a title agent pays his or her biennial renewal fee, such agent
shall also furnish the written certification and filing fee required by
this section.

11. No rule or portion of a rule promulgated pursuant to the authority of
this section shall become effective unless it has been promulgated
pursuant to the provisions of chapter 536, RSMo. (L. 2000 S.B. 894)

Effective 1-1-01

*Word "the" appears in original rolls.

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

The director may during normal business hours examine, audit and
inspect any and all books and records maintained by a title agency
pursuant to this chapter. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. Whenever the business to be written constitutes affiliated
business, prior to commencing the transaction, the title agency or title
agent shall ensure that its customer has been provided with disclosure of
the existence of the affiliated business arrangement and a written
estimate of the charge or range of charges generally made for the title
services provided by the title agency or agent.

2. The director may establish rules for use by all title agencies in the
recording and reporting of the agency's owners and of the agency's
ownership interests in other persons or businesses and of material
transactions between the parties.

3. The director may require each title agency to file on forms prescribed
by the director reports setting forth the names and addresses of those
persons, if any, that have a financial interest in the agency and who the
agency knows or has reason to believe are producers of title insurance
business or associates of producers.

4. Nothing in this chapter shall be construed as prohibiting affiliated
business arrangements in the provision of title insurance business so
long as:

(1) The title agency, title agent or party making a referral constituting
affiliated business, at or prior to the time of the referral, discloses
the arrangement and, in connection with the referral, provides the person
being referred with a written estimate of the charge or range of charges
likely to be assessed and otherwise complies with the disclosure
obligations of this section;

(2) The person being referred is not required to use a specified title
insurance agency, agent or insurer; and

(3) The only thing of value that is received by the title agency, title
agent or party making the referral, other than payments otherwise
permitted, is a return on an ownership interest. For purposes of this
subsection, the terms "required use" and "return on an ownership
interest" shall have the meaning accorded to them under the Real Estate
Settlement Procedures Act (RESPA), 12 U.S.C. Section 2607, as amended and
Regulation X, 24 CFR Section 3500, et seq.

5. Each violation of any provision of this section is a class C violation
as that term is defined in section 381.045. (L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. As used in this section and sections 381.403 and 381.405, the
following terms mean:

(1) "Construction completion guaranty", an agreement wherein a person
guarantees or warrants that the improvements which are the subject of the
guaranty will be completed or that the funds deposited under the guaranty
are sufficient to complete such improvements;

(2) "Construction deposit guaranty", an agreement wherein a person agrees
to accept funds from a mortgage lender, owner or purchaser of real estate
or agrees to assure the proper application of funds already paid to a
third party to pay for the cost of construction of improvements on such
real estate, for disbursement to parties furnishing labor or material for
the construction of such improvement and wherein the person guarantees to
the party depositing the funds against loss from misapplication of the
funds or inability to obtain a refund of the funds when such party is
entitled to a refund thereof;

(3) "Construction escrow agreement", an agreement wherein a person agrees
to accept from a mortgage lender, owner or purchaser of real estate funds
to pay for the cost of construction of improvements on such real estate,
for disbursement to the owner, general contractor, or parties furnishing
labor or material for the construction of such improvement, but which
does not contain any guarantee to the party depositing the funds against
loss from misapplication of the funds or inability to obtain a refund of
the funds. The issuance of title insurance against mechanics' liens does
not constitute a construction deposit guaranty or construction completion
guaranty;

(4) "Insured closing letter", a statement issued by a title insurance
company to a party to a real estate transaction, acknowledging that the
title insurance agency or agent closing a transaction in connection with
which the title insurance company's policy is being issued, is a duly
licensed and authorized agency or agent of the title insurance company,
that the performance of settlement services by such agency or agent is
within the scope of its authority as agency or agent for the title
insurance company, and promising to be responsible for the misapplication
of funds or documents by the agency or agent or its failure to follow
written instructions in connection with the closing;

(5) "Licensee", a title insurance company organized under the laws of
this state or operating under a certificate of authority in this state,
or a title insurance agency or agent licensed by the director. (L. 1993
S.B. 18 § 381.143 subsec. 1)

Licensees may:

(1) Enter into construction escrow agreements as part of their services
as title insurance companies or title insurance agencies;

(2) Issue insured closing letters, if the licensee is a title insurance
company. (L. 1993 S.B. 18 § 381.143 subsec. 2)

No licensee may enter or offer to enter into any:

(1) Construction deposit guaranty;

(2) Construction completion guaranty;

(3) Contract of guaranty or suretyship wherein the licensee agrees to
answer for the debt, obligation or default of a third party, including,
but not limited to, statements of responsibility for the acts or
omissions of parties which would constitute an insured closing letter if
the party on whose behalf the statement is made had been a title
insurance agency or agent for the issuer. The provisions of this section
shall not prohibit licensees from issuing title insurance against
mechanics' liens, nor prohibit a title insurance company from issuing
insured closing letters regarding its own duly licensed agency or agent.
(L. 1993 S.B. 18 § 381.143 subsec. 3)

As used in this section and section 381.412, the following terms
mean:

(1) "Cashier's check", a check, however labeled, drawn on the financial
institution, which is signed only by an officer or employee of such
institution, is a direct obligation of such institution, and is provided
to a customer of such institution or acquired from such institution for
remittance purposes;

(2) "Certified funds", United States currency, funds conveyed by a
cashier's check, certified check, teller's check, as defined in Federal
Reserve Regulations CC, or wire transfers, including written advice from
a financial institution that collected funds have been credited to the
settlement agent's account;

(3) "Director", the director of the department of insurance, unless the
settlement agent's primary regulator is another division in the
department of economic development. When the settlement agent is
regulated by such division, that division shall have jurisdiction over
this section and section 381.412;

(4) "Financial institution":

(a) A person or entity doing business pursuant to the laws of this state
or the United States relating to banks, trust companies, savings and loan
associations or credit unions; or

(b) The following persons or entities if their principal place of
business is in Missouri or outside Missouri, but within the St. Louis or
Kansas City standard metropolitan statistical area:

a. A mortgage loan company which is subject to licensing, supervision or
auditing by the Federal National Mortgage Association, or the Federal
Home Loan Mortgage Corporation, or the United States Veterans
Administration, or the Government National Mortgage Association, or the
United States Department of Housing and Urban Development, or a successor
of any of the foregoing agencies or entities, as an approved seller or
servicer;

(5) "Settlement agent", a person, corporation, partnership, or other
business organization which accepts funds and documents as fiduciary for
the buyer, seller or lender for the purposes of closing a sale of an
interest in real estate located within the state of Missouri, and is not
a financial institution, or a member in good standing of the Missouri Bar
, or a person licensed under chapter 339, RSMo. (L. 1996 S.B. 664, A.L.
2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. A settlement agent who accepts funds of more than ten
thousand dollars for closing a sale of an interest in real estate shall
require a buyer, seller or lender who is not a financial institution to
convey such funds to the settlement agent as certified funds. A check:

(1) Drawn on an escrow account of a licensed real estate broker, as
regulated and described in section 339.105, RSMo;

(2) Drawn on an escrow account of a title insurer or title insurance
agency licensed to do business in Missouri;

(3) Drawn on an agency of the United States of America, the state of
Missouri or any county or municipality of the state of Missouri; or

(4) Drawn on an account by a financial institution;

shall be exempt from the provisions of this section.

2. No title insurer, title insurance agency or title insurance agent, as
defined in section 381.009, shall make any payment, disbursement or
withdrawal in excess of ten thousand dollars from an escrow account which
it maintains as a depository of funds received from the public for the
settlement of real estate transactions unless a corresponding deposit of
funds was made to the escrow account for the benefit of the payee or
payees:

(1) At least ten days prior to such payment, disbursement or withdrawal;

(2) Which consisted of certified funds; or

(3) Consisted of a check made exempt from this section by the provisions
of subsection 1 of this section.

3. If the director finds that a settlement agent, title insurer, title
insurance agency or title insurance agent has violated any provisions of
this section, the director may assess a fine of not more than two
thousand dollars for each violation, plus the costs of the investigation.
Each separate transaction where certified funds are required shall
constitute a separate violation. In determining a fine, the director
shall consider the extent to which the violation was a knowing and
willful violation, the corrective action taken by the settlement agent to
ensure that the violation will not be repeated, and the record of the
settlement agent in complying with the provisions of this section. (L.
1996 S.B. 664, A.L. 1997 S.B. 148, A.L. 2000 S.B. 894)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

Usa-missouri Law Firm / Lawyers Services Provided in Usa-missouri :

Usa-missouri Divorce Laws, custody, Usa-missouri Corporate Lawyers, Agreement, provident fund, Registered marriage, Court marriage Lawyers, Special/ Foreign marriage, Incorporation of company, Rent, eviction, tenancy, Lease Lawyers, Usa-missouri Labour laws, Appeals, Supreme Court Lawyers, High Court Lawyers, Bail, medical, negligence, Insurance claims/ accidents Lawyer, Usa-missouri Citizenship/ immigration Lawyers, Copyright Laws, Consumer, district Lawyer, State, national, Dowry, Wills & Probate, Trust & Estates Lawyers, Intellectual Property Lawyer, Bankrupt Lawyers, Banking & Finance, Corporate, Private Business Law, Recovery, Joint Venture & Mergers, Consumer, Civil Right Law Usa-missouri, Medical Negligence, Medical Malpractice, legal notice, summons, Income Tax Lawyers, sales, Custom Law, Excise Law, octroi, cess Civil, Criminal Solicitor Usa-missouri, Registration of property, Title search, mutation relationship, Conveyance, Transfer of Property Law, Usa-missouri Property lawyer, deeds, drafts, power of attorney, Recovery, Taxation Laws in Usa-missouri

LEGAL SERVICES

Add Lawyer
Legal Enquiry
Find a Lawyer
Bare Acts / India Codes
Statutes / Code

LAWYER BY LOCATION

India Lawyer
United State Lawyer
UAE Lawyer
Canada Lawyer
Find More...

LAW PRACTICE AREA

Business Law
Employment & Labor Law
Govt. Agencis & Taxtion
Family Law
Real Estate Property Law
Immigration Law

ABOUT HELPLINELAW

About Us
Contact Us
Services
Site Map
Recommend to Friends

This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Persons accessing this site are encouraged to seek independent counsel for advice in India abroad regarding their individual legal, civil criminal issues or consult one of the experts online.