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How to stay out of

HOT water?

(Keeping Title Agents LUKEWARM)

William R. Lacy

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1200 West Third Street

Little Rock, AR 72201-1904 501-682-5215 Phone

501-917-2748 FAX

 Sarah Harper Gray,

Title Insurance Coordinator

 Nina Carter,

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Insurance Commissioner

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Commissioner Bradford was appointed in

January 2009 by Governor Mike Beebe.



Our Commissioner has more than four

decades of experience in the insurance

industry, including 30 years as founder of

First Arkansas Insurance Group, a

statewide network of independent property

and casualty agencies.



Customer service and consumer

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Previously, the Director of the Division of

Behavioral Health Services within the AR

Department of Human Services.

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 The Arkansas Insurance Department gained jurisdiction over the licensing of title insurance agents on January 1, 2008, through the

Arkansas Title Insurance Act, Act 684.

 The Department already had jurisdiction over title insurance companies.

 Ark. Code Ann. § 23-103-401 et. seq.

 The ACT abolished the Arkansas Title Insurance Agents’ Licensing Board and transferred its

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Department Rules Promulgated



Rule 87 – Title Insurance

Provides Department guidance to the Title Insurance Act



Rule 88 – Title Insurance Licensing and

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What does being a licensed title

agent qualify me to do?



The statutory definition of a title insurance

agent is: an individual affiliated with a title

insurance agency that is authorized on

behalf of a title insurer (underwriter) to

issue a title insurance report or title

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Avoid Licensing Issues?



The Title Agent License is a

comprehensive license.

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 “Solicit”

 Calculating title insurance rates subject to reissue rates, enhancements to coverage, endorsements or any deviation from any licensed title

insurance agency’s standard published rates

 “Negotiate”

 Explain, discuss or interpret coverage, analyze exposures or policies, or

give opinions or recommendations as to coverage

 Counsel, urge or advise any prospective buyer or seller to purchase a

particular policy or to insure with a particular company (insurer)

 Examination of title to determine marketability and insurability of title in

accordance with the title insurer’s underwriting practices

 Guaranteeing, warranting, or otherwise insuring the status of title, liens,

encumbrances, or other matters of record

 Production, issuance and execution of a title insurance commitment or

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 “Sell”

 Indicate that requested coverage is or will be bound or issued  Bind coverage

 A closing agent who explains, discusses or interprets coverage,

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 Who doesn’t need a license:

 Dispense brochures and other general information (so long as no conversation

relating to the terms of a title insurance commitment and/or policy)

 Performs marketing duties under the supervision of a title insurance agent

 Gathering and receiving information from a potential policyholder to give to an agent  Scheduling appointments with a title agent

 Quoting title insurance rates including references to a published or printed list or

computer data base of standard rates prepared by a licensed title insurance agent

 Communicating with the policyholder or prospective policyholder in order to obtain

factual information necessary to complete a title search of all matters of record

 Conducting a title search

 An individual performing escrow and real estate closing or settlement services and

who does not solicit, sell or negotiate title insurance.

 Providing the document and obtaining purchasers’ and/or borrowers’ signatures on

the written notice required by A.C.A. § 23-103-413(b)(1)

 A closing agent that provides closing services but does not otherwise engage in title

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Additional Information Regarding Licensing:

http://www.insurance.arkansas.gov/License/TitleFAQs.htm

Highlights:

Ark. Code Ann. § 23-64-502(11) "Negotiate" means the act of conferring directly with or offering advice directly to a purchaser or prospective

purchaser of a particular contract of insurance concerning any of the

substantive benefits, terms, or conditions of the contract, provided that the person engaged in that act either sells insurance or obtains insurance from insurers for purchasers;

Ark. Code Ann. § 23-64-502(13) "Sell" means to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurance company;

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How to keep a Title Insurance

Agent’s License?



Renew of your License is Due by

Your Birthday



Complete Annual CE



Maintain an Company Appointment

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Continue to be:

Competent Trustworthy

Financially Responsible

Good Personal and Business Reputation



Comply with the PLMA, Ark. Code Ann. §

23-64-501 et seq.

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How Can I Lose my Title Insurance

Agent’s License?

 § 23-64-512. License denial, nonrenewal, or revocation

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(1) Providing incorrect, misleading, incomplete, or materially untrue information in the license

application;

(2) Violating any of the following that calls into

question the insurance producer’s fitness to hold a license:

(A) A law; or

(B) A regulation, subpoena, or order of: (i) The commissioner;

(ii) Another state’s insurance commissioner; or (iii) A court of competent jurisdiction.

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(4) Improperly withholding, misappropriating, or

converting any moneys or properties received in the course of doing insurance business;

(5) Intentionally misrepresenting the terms of an actual or proposed insurance contract or

application for insurance;

(6) Having been convicted of a felony;

(7) Having admitted or been found to have

committed any insurance unfair trade practice or fraud;

(8) Using fraudulent, coercive, or dishonest practices or demonstrating incompetence, untrustworthiness, lack of good personal or

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(9) Having an insurance producer license or its

equivalent denied, suspended, or revoked in any other state, province, district, or territory;

(10) Forging another’s name to an application for insurance or to any document related to an

insurance transaction;

(11) Improperly using notes or any other reference material to complete an examination for an

insurance license;

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(13) Failing to provide a written response after receipt of a written inquiry from the commissioner or his or her

representative as to transactions under the license within thirty (30) days after receipt thereof unless the timely

written response is knowingly waived in writing by the commissioner;

(14) Failing to comply with an administrative or court order imposing a child support obligation;

(15) Failing to pay state income tax or comply with any administrative or court order directing payment of state income tax;

(16) Refusing to be examined or to produce any accounts, records, or files for examination; or

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§ 23-103-416. Penalties--Liabilities

(a) If the Insurance Commissioner determines that a title insurer, title insurance agency, title insurance agent, or any other person has violated this subchapter or any rule or order promulgated under this subchapter, the

commissioner may order:

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(B) If the title insurer, title insurance agency,

title insurance agent, or other person

knew or reasonably should have known

that the title insurer, title insurance

agency, title insurance agent, or other

person was in violation of this subchapter,

the penalty shall not exceed five thousand

dollars ($5,000) for each act or violation

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(2) Suspension or revocation of the title insurer’s, title insurance

agency’s, title insurance agent’s, or other person’s license if the title insurer, title insurance agency, title insurance agent, or other person knew or reasonably should have known that the title insurer, title insurance agency, title insurance agent, or other person was in violation of this subchapter.

(b) If an order of rehabilitation or liquidation of the title insurer or of conservation of assets of the title insurer has been entered and the receiver appointed under the order determines that the title insurance agency or title insurance agent or any other person has not complied with this subchapter or any rule or order promulgated under this subchapter and the title insurer suffered any resulting loss or damage, the receiver may

maintain a civil action for recovery of damages or other

appropriate sanctions for the benefit of the title insurer and its policyholders and creditors.

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Other Penalties…



Letter of Reprimand



Probation



Suspension



Revocation of License

By Consent Order

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Trade Practices Act



§ 23-66-201, et seq.



Unfair competition, unfair or deceptive acts



§ 23-66-206 Definitions

Defamation

False information and advertising

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§ 23-66-505 Mandatory Reporting

of Fraudulent Insurance Acts

 (a) A person engaged in the business of

insurance having knowledge or a reasonable belief that a fraudulent insurance act is being, will be, or has been committed shall provide to the Insurance Commissioner the information

required by, and in a manner prescribed by, the commissioner.

 (b) Any person engaged in the business of insurance who knowingly fails to report as

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 The Criminal Investigation Division (CID) is a division within the Arkansas Insurance

Department. CID was created by the State Legislature in 1993 to investigate workers'

compensation fraud. In 1997, the Legislature

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To report a suspected case of fraud:

Mail or fax CID a copy of the

Uniform Suspected Insurance

Fraud Reporting Form

,

or

Complete the national NAIC Online Reporting Form,

or

Call CID at (866) 660-0888 or (501) 371- 2790 or email at

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Consumer Protection



Consumer Protection is a focus



Agent Education

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Complaints



Complaints can be filed by consumers or

other agents



Examine for Violations of the Insurance

Code



Possible Fraud?

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Thank You!

Please contact us if you have any other questions.

Arkansas Insurance Department 1200 West Third Street

Little Rock, AR 72201-1904 501-682-5215 Phone

501-371-2748 FAX

 Sarah Harper,

Title Insurance Coordinator

sarah.harper@arkansas.gov

 Nina Carter,

Associate Counsel

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References

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