Legislation


SB 372

Sen. Bob Hall (R-Edgewood)

Key elements of SB 372 are:
  • The Commissioner would no longer set rates
  • Rates would be filed by each underwriter under a "file and use" system
  • Underwriters would be required to consider agent income and expenses when filing rates
  • The split between agents and underwriters would no longer be regulated by the Commissioner, but rather determined between each agent and each underwriter
TLTA is strongly opposed to this legislation. TLTA president James Dudley said, "Despite what the proponents say, we believe such a change would lead to higher prices and increased risk for the average homebuyer and less choice for the consumer because of dramatic market consolidation. The Texas title insurance system has a proven track record of serving Texas consumers well and should not be upended."

HB 4239

Rep. Sergio Muñoz, Jr. (D-Palmview), Rep. John Smithee (R-Amarillo)

HB 4239 proposes a flex band rate system as well as some other regulatory cleanup items dealing with transparency in reporting.

  • States that the commissioner shall continue to fix and promulgate the premium rates to be charged, but also states that the Commissioner shall set "flexible rate bands" within which a lower or higher rate can be charged. 
  • The flexible rate band must be a range that is a maximum percentage above or below the promulgated rate. A title insurance company (underwriter) may file with the Commissioner to use a premium rate that is different from the promulgated rate but within the flexible rate band set by the Commissioner. 
  • In order to charge a rate that is different than the promulgated rate, a title insurance company (underwriter) would file a premium rate within the flexible rate band. The filing would require actuarial support, could not be excessive, inadequate or unfairly discriminatory, etc. 
  • Takes away any limitations on who has standing to request a rate hearing, changing that simply to "an interested person." 
  • Codifies in law the P-73 regulation already in place in the Basic Manual, requiring a separate promulgated Texas disclosure in conjunction with the Closing Disclosure to accurately disclose the title insurance premium, the amount of each portion of that premium to a third party and an itemization of all other fees and charges paid to the settlement agent. No real change other than to formalize this requirement in statute. 

TLTA is opposed to this legislation.

SB 2203

Sen. Kelly Hancock (R-North Richland Hills)

SB 2203 does not address title insurance rate making at all, but mimics the other regulatory cleanup proposals in Muñoz's bill.

  • Codifies in law the P-73 regulation already in place in the Basic Manual, requiring a separate promulgated Texas disclosure in conjunction with the Closing Disclosure to accurately disclose the title insurance premium, the amount of each portion of that premium to a third party and an itemization of all other fees and charges paid to the settlement agent. No real change other than to formalize this requirement in statute. 
  • Requires TDI to conform the statistical report to the manner in which accounting records are normally kept in the ordinary business of a title insurance company or agent. This is an effort TLTA had already been working on and supports. 

TLTA supports this legislation with no amendments.

If you have any questions about this material or want more information, please contact Aaron Day, Director of Government Affairs and Counsel, at 512.810.8800 or email him at aaron@tlta.com.