Title Insurance Rates |
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What are the Current Title Insurance Issue and Re-Issue Rates? When am I entitled to a Discount? The Office of Insurance Regulation sets rates for title insurance premiums, called the “promulgated rate”; title insurance agents charge at least the minimum promulgated rate when issuing title insurance policies. To determine the promulgated rate, the Office takes into account underlying risks and, further, the various costs associated with underwriters’ issuance of title insurance policies (i.e. administrative surcharges, annual licensing fees and taxes paid to the state on the gross amount of premiums sold). The “regular title insurance premium” that is charged to you consists of the promulgated rate, as well as charges for related title services (e.g. preparing title information and other documents and conducting the closing for the real estate transaction, in which the title insurance binder, commitment or policy is issued). As of recent, the Office has required that your title insurance agent break the regular title insurance premium down into its constituent parts (promulgated rate, title search charges, examination fees and closing charges) on your closing statement. The Office hopes that you will thus be better informed as to the cost of title insurance, and, further, that it will be better able to monitor practices within the industry to ensure that title insurance agents and underwriters are not compromising the promulgated rate. In Florida, your promulgated rate is calculated primarily in accordance with your property’s insurable value. If you obtain a title insurance policy pursuant to your purchase of property, the rate is determined by the purchase price of the property. If, however, a title insurance policy was recently taken out on your property – or if you obtain the policy pursuant to a mortgage refinance, which refers to the process of replacing your existing debt obligation with another bearing different terms – you may be entitled to a discounted “reissue rate”. Remember, however, that a common title insurance agent is not obligated to acknowledge your qualification for this reissue rate/ credit, while a title insurance attorney will owe you a fiduciary duty to fully disclose this and other such benefits.
A. When do you qualify for a re-issue credit? Simply stated, you qualify for a reissue credit if you are obtaining a title insurance policy for property for which a title insurance policy was only recently purchased and which has not since been improved (i.e. undergone construction, etc.). To be more specific, however, the following criteria must be met to qualify for a reissue credit:FIRST, an owner’s title insurance policy for the property must have been issued previously to insure either the seller or the borrower in the current transaction; and SECOND, the property must not have been improved since the original policy date, except for roads, bridges, drainage facilities or utilities; or, the original policy date must be less than three years prior to the reissue date; or, the new policy must be a mortgagee’s policy issued upon the refinancing of property for which the current mortgagor had previously obtained an owner’s policy. B. Title Insurance Premium Calculator To calculate the promulgated rate for your property’s basic title insurance premium, which is the absolute minimum that your title insurance underwriter can charge you if you do not qualify for a reissue credit as noted above, use the following table:
To calculate the promulgated rate for the reissuance of title insurance for your property, which is the absolute minimum that your title insurance underwriter can charge you if you qualify for a reissue credit as noted above, use the following table:
Hypothetical: Say you have contracted to purchase a home for $110,000.00. To calculate the promulgated rate for your property’s basic title insurance premium, you would use the first table listed above and engage in the following two steps: (1) Multiply $5.75 by 100 to arrive at the rate to be charged for the first $100,000.00 of your property’s value, for a total of $575.00. (2) Multiply $5.00 by 10 to arrive at the rate to be charged for the remaining $10,000.00 of your property’s value, for a total of $50.00. Add both values to determine the promulgated rate for your property’s basic title insurance premium, which comes to $625.00. Note: If you are obtaining title insurance pursuant to, for example, an attempt to refinance a mortgage on your property, and you meet the remaining requirements for a reissue credit, you would use the second table listed above, and engage in the aforementioned two steps to arrive at the promulgated rate for your property’s “reissue” title insurance premium. Remember, however, that the promulgated rate is generally the rate your title insurance underwriter will charge you to insure the title to your property. The promulgated rate is only ONE component of the regular title insurance premium you will pay for your title insurance policy. Which additional fees will apply will depend on the underwriter and title agent you select.
Contact an Experienced Title Insurance Lawyer To learn more about Lawrence Tolchinsky, click on this link: Florida Title Insurance Attorney
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