The hearing is in the wake of recent rate reduction agreements of two large title insurers (you can read about this case in a previous post) due to a regulatory investigation by the NY Attorney General’s Office that has sparked the interest of the insurance department.
Superintendent Mills stated, “Title insurance protects homeowners from future claims made against their property but consumers are often unaware of the different fees and charges that comprise their title insurance payment.”
Some of the main topics that will be discussed are the following:
- The cost to the title insurance company/title agents to perform the necessary searches of pertinent records compared with the premium rates charged;
- The premiums paid to title insurance companies, the commissions or fees paid to title agents/attorney agents and the effect such premiums, commissions and fees have on the overall cost to consumers;
- The rationale for the existence of two rate tiers within the state based on where a property is situated, and whether that current system should continue;
- The effect on the consumer of the current compensation structure, including affiliated business arrangements and referral fees; and
- Whether different rates should be charged for residential and commercial properties.
If you have ever wondered exactly the purpose of title insurance here is a brief description from the press release:
Title insurance protects the buyer and the mortgage holder in a real estate transaction by ensuring that the seller has legal title to the subject property. A title search is performed by the title insurance company, title insurance agent, or an attorney prior to the closing. This search will reveal whether any liens or claims are pending against the property and ascertain whether the seller has clear title to the property being offered to a prospective buyer.
If you wish to attend this hearing and possibly participate take down the following information:
Those interested in testifying at the Friday, Nov. 3, 2006 public hearing should register in advance by contacting Ms. Ellen Wenz, Public Affairs Bureau, New York State Insurance Department, 25 Beaver Street-3rd Floor, New York, NY 10004. Those persons who cannot attend but would like to submit written comments should address them to Ms. Ellen Wenz, at the above address. Written comments will be accepted and incorporated into the official record for 30 days thereafter.
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