- September 27, 2012
- All Florida Issuing Offices
- Changes in Surety Bond procedures pursuant to HB 725
House Bill 725, effective October 1, 2012, changes the procedures regarding the State’s requirement that title insurance agents post a Surety bond in the amount of $35,000. Previously, the payee on the surety bond was the Department of Insurance and then more recently, the Department of Financial Services. With the passing of HB 725, the payee on the surety bond must now be your title insurance underwriter or underwriters. If you have more than one underwriter, each underwriter must be listed separately as named on the bond.
In accordance with the new law,
In addition, the option to post cash with DFS in lieu of purchasing a bond has been eliminated. In the event that you had chosen that option, you may request a return of your posted cash by submitting a Withdrawal of Collateral Form to DFS. A copy of the form is attached.
Since the law goes into effect October 1, 2012, and mandates that each title insurer have proof of coverage in its files to either appoint, retain or renew an agency appointment, it is critical that you take immediate steps to comply. Consequently, please instruct your surety bond provider to issue an endorsement of the bond or alternatively, issue a rider so that Stewart Title Guaranty Company,
Stewart Title has designated Evelyn Ayala as the local Agency Services representative in
Stewart Title Guaranty Company
Finally, the new law requires that if the surety bond is payable to multiple insurers, the surety bond must provide for each title insurer to be notified in the event a claim is made upon the surety bond or the bond is terminated. This notice will now have to be given by the surety bond company and if so required, you must give them permission to provide such notice.
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THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.