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91_HB1915
LRB9104616JSpc
1 AN ACT concerning the regulation of title insurers.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Title Insurance Act is amended by
5 changing Section 14 and adding Section 19.1 as follows:
6 (215 ILCS 155/14) (from Ch. 73, par. 1414)
7 Sec. 14. (a) Every title insurance company and every
8 independent escrowee subject to this Act shall pay the
9 following fees:
10 (1) for filing the original application for a
11 certificate of authority and receiving the deposit
12 required under this Act, $500;
13 (2) for the certificate of authority, $10;
14 (3) for every copy of a paper filed in the
15 Department under this Act, $1 per folio;
16 (4) for affixing the seal of the Department and
17 certifying a copy, $2;
18 (5) for filing the annual statement, $50.
19 (b) Each title insurance company shall pay, for all of
20 its title insurance agents subject to this Act for filing an
21 annual registration of its agents, an amount equal to $1.00
22 for each policy issued by all of its agents in the
23 immediately preceding calendar year, provided such sum shall
24 not exceed $20,000 per annum.
25 (c) The Director shall determine a rate of assessment
26 and collect a maintenance fee in an amount not to exceed
27 0.10% of the correctly reported total direct premiums written
28 in Illinois by all title insurers. The fee required by this
29 subsection is in addition to all other taxes and fees imposed
30 or that may be subsequently imposed and that are not in
31 conflict with this Act. The Director, after taking into
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1 account the unexpended funds, if any, produced by this fee
2 shall adjust the rate of assessment each year to produce the
3 amount of funds that he estimates will be necessary to pay
4 all the expenses of regulating the business of title
5 insurance during the succeeding year. The Director in
6 promulgating rates shall take into account assessments made
7 under this Section.
8 (Source: P.A. 86-239.)
9 (215 ILCS 155/19.1 new)
10 Sec. 19.1. Policy forms; fees.
11 (a) All title insurance companies and title agents or
12 others engaged in the business of guaranteeing or insuring
13 titles to Illinois real estate are subject to regulation,
14 control, and supervision under uniform rules as to the forms
15 of policies, endorsements, underwriting contracts, and rates
16 thereof, and practices as may be from time to time prescribed
17 by the Director, and no company or agent shall be permitted
18 to issue any title insurance policy, endorsement, or
19 underwriting contract that does not conform with rules issued
20 by the Director under this Act. Any title insurance policy,
21 endorsement, or underwriting contract issued on Illinois real
22 property that does not so conform shall subject the issuer to
23 penalties set forth in Sections 21 and 23.
24 Title insurance "rates" subject to regulation by the
25 Director includes all fees and charges for title insurance
26 forms including fees for search and examination of title and
27 premiums for insurance.
28 "Title insurance premiums" means only the portion of the
29 rate actually remitted to the title insurer for its
30 assumption of the risk and excludes any portion of the rate
31 retained by the title agent.
32 "Title insurance forms", subject to regulation by the
33 Director, means title insurance policies, standard form
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1 endorsements, and title insurance reports and commitments
2 issued prior to the issuance of a title insurance policy.
3 (b) The Director shall hold hearings on the earliest
4 convenient date following the effective date of this
5 amendatory Act of the 91st General Assembly in order to
6 implement the provisions of this Section, including the
7 adoption of a schedule of minimum rates and fees for escrow,
8 no later than July 1, 2000. The Director may use emergency
9 rulemaking procedures under Section 5.02 of the Illinois
10 Administrative Procedure Act to adopt the initial schedule of
11 rates and fees. Subsequent hearings shall be held every 2
12 years commencing in 2002 not earlier than October 1 to
13 consider the adoption of rates, forms, and other matters and
14 subjects as may be requested by any title insurance company,
15 title insurance agent, or other interested party including
16 members of the public and the Director. Proper notice of
17 public hearings and the items to be considered shall be made
18 to the public in the manner prescribed by the Director and
19 sent by regular United States mail to all title insurance
20 companies and title insurance agents not less than 4 weeks
21 before the hearing.
22 The Director shall promulgate or approve reasonable
23 rules, including rules providing statistical plans, for use
24 by all insurers in the recording and reporting of loss and
25 expense experience, in order that the experience of such
26 insurers may be made available to the Director. No insurer
27 shall be required to record or report its experience on a
28 classification basis inconsistent with its own rating system.
29 (c) The Director shall collect data from title insurance
30 companies deemed appropriate for the purpose of determining
31 the proper rates to be established in the form that the
32 Director deems proper including, but not limited to, loss
33 experience, expense of operation, cost of obtaining search
34 packages, cost of title examinations, and other material
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1 matters. Failure to provide data promptly upon request shall
2 constitute a violation of Section 21 and subject the violator
3 to penalties as set forth in that Section. For purposes of
4 this Section, data submitted to the Director by title
5 insurance companies and appropriate to ascertaining proper
6 rates for title insurance is to be kept separate from other
7 records of any title insurance agent where the agent is also
8 engaged in a trade, business, or profession other than the
9 business of guaranteeing or insuring title to real estate.
10 Rates established by the Director are to be the same for all
11 title insurance companies and title insurance agents, and not
12 subject to discount or reduction by reason of shared time,
13 space, or information with other trade, business or
14 profession.
15 (d) The Director shall have the duty to approve forms of
16 title insurance policies and endorsements, and promulgate
17 them together with schedules for rates and fees charged to
18 the public and the minimum portion of that rate to be paid to
19 or retained by the title insurance company. Under no
20 circumstances shall any rate be charged or divided for any
21 policy of title insurance, endorsement, or escrow or other
22 settlement services, or other promulgated or approved form
23 less than that established by the Director, it being the
24 intent of this amendatory Act of the 91st General Assembly to
25 establish statutory regulation to displace market pricing
26 which may be below the minimum set by the Director for the
27 protection of the title insurance companies and the public.
28 Rates and fees promulgated by the Director shall be
29 reasonable to the public and shall not be excessive,
30 inadequate, or discriminatory.
31 Rates are inadequate if they are clearly insufficient,
32 together with the investment income attributable to them, to
33 sustain projected losses and expenses and a reasonable
34 profit.
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1 Rates are unfairly discriminatory if they clearly fail to
2 reflect equitably the differences in expected losses and
3 expenses. Rates are not unfairly discriminatory because
4 different premiums result for policy holders with like loss
5 exposures but different expense factors, or like expense
6 factors but different loss exposures, so long as the rates
7 reflect reasonable differences.
8 (e) Schedules for minimum rates and fees shall be
9 established by rule in accordance with the Illinois
10 Administrative Procedure Act. Notice of any public hearing
11 shall be mailed to all title insurance companies and title
12 insurance agents not less than 60 days before the hearing and
13 shall be published in the Illinois Register.
14 (f) Notwithstanding the provisions of subsections (a)
15 through (e) to the contrary, where changes in law or factors
16 unique to the real property or transaction to be insured
17 result in a written request for an endorsement, affirmative
18 assurance, or other coverage that has not been approved and
19 promulgated, the Director and title insurance companies and
20 their agents engaged in the business of guaranteeing or
21 insuring title to Illinois real estate shall be permitted to
22 negotiate, underwrite, and issue for such additional rate as
23 may be agreed based on analogy to approved and promulgated
24 rates for approved and promulgated endorsements, affirmative
25 assurances or other coverage. Promptly upon issuance of such
26 endorsement, affirmative assurance or other coverage not
27 previously approved and promulgated by the Director, the
28 title insurance company shall provide to the Department, as
29 instructed by the Director, a copy of the written request,
30 endorsement, affirmative assurance, or other coverage and the
31 additional rate charged therefor together with a detailed
32 explanation of the change in law or factors unique to the
33 real property or transaction insured. It shall be thereafter
34 the duty of the Director to approve and promulgate such
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1 endorsement, affirmative assurance, or other coverage and
2 rate, or modify, grant approval and promulgate as modified,
3 or proscribe future issuance of such endorsement, affirmative
4 assurance or other coverage following a hearing as herein
5 provided. Copies of the endorsement, affirmative assurance,
6 or other coverage and the rate charged therefor shall be made
7 available to the public and may be used unless and until
8 proscribed or modified.
9 (215 ILCS 155/19 rep.)
10 Section 10. The Title Insurance Act is amended by
11 repealing Section 19.
12 Section 99. Effective date. This Act takes effect upon
13 becoming law.