31A-23a-204.  Special requirements for title insurance producers and agencies.
     An individual title insurance producer or agency title insurance producer shall be licensed in accordance with this chapter, with the additional requirements listed in this section.

(1) 

Terms Used In Utah Code 31A-23a-204

  • Administrator: means the same as that term is defined in Subsection (182). See Utah Code 31A-1-301
  • Agency: means :
(a) a person other than an individual, including a sole proprietorship by which an individual does business under an assumed name; and
(b) an insurance organization licensed or required to be licensed under Section 31A-23a-301, 31A-25-207, or 31A-26-209. See Utah Code 31A-1-301
  • Contract: A legal written agreement that becomes binding when signed.
  • Escrow: Money given to a third party to be held for payment until certain conditions are met.
  • Escrow: means :
    (i) a transaction that effects the sale, transfer, encumbering, or leasing of real property, when a person not a party to the transaction, and neither having nor acquiring an interest in the title, performs, in accordance with the written instructions or terms of the written agreement between the parties to the transaction, any of the following actions:
    (A) the explanation, holding, or creation of a document; or
    (B) the receipt, deposit, and disbursement of money;
    (ii) a settlement or closing involving:
    (A) a mobile home;
    (B) a grazing right;
    (C) a water right; or
    (D) other personal property authorized by the commissioner. See Utah Code 31A-1-301
  • Fiduciary: A trustee, executor, or administrator.
  • Individual: means a natural person. See Utah Code 31A-1-301
  • Insurance: includes :
    (i) a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
    (ii) a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
    (iii) a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
  • Insurer: is a s defined in Section 31A-1-301, except that the following persons or similar persons are not insurers for purposes of 7:
    (a) a risk retention group as defined in:
    (i) the Superfund Amendments and Reauthorization Act of 1986, Pub. See Utah Code 31A-23a-102
  • Liability insurance: includes :
    (i) vehicle liability insurance;
    (ii) residential dwelling liability insurance; and
    (iii) making inspection of, and issuing a certificate of inspection upon, an elevator, boiler, machinery, or apparatus of any kind when done in connection with insurance on the elevator, boiler, machinery, or apparatus. See Utah Code 31A-1-301
  • License: includes a certificate of authority issued to an insurer. See Utah Code 31A-1-301
  • Person: includes :
    (a) an individual;
    (b) a partnership;
    (c) a corporation;
    (d) an incorporated or unincorporated association;
    (e) a joint stock company;
    (f) a trust;
    (g) a limited liability company;
    (h) a reciprocal;
    (i) a syndicate; or
    (j) another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301
  • Policy: includes a service contract issued by:
    (i) a motor club under Chapter 11, Motor Clubs;
    (ii) a service contract provided under Chapter 6a, Service Contracts; and
    (iii) a corporation licensed under:
    (A) Chapter 7, Nonprofit Health Service Insurance Corporations; or
    (B) Chapter 8, Health Maintenance Organizations and Limited Health Plans. See Utah Code 31A-1-301
  • producer: means a person licensed or required to be licensed under the laws of this state to sell, solicit, or negotiate insurance. See Utah Code 31A-1-301
  • Title examination: means a license subline of authority in conjunction with the title insurance line of authority that allows a person to issue title insurance commitments or policies on behalf of a title insurer. See Utah Code 31A-23a-102
  • Title insurance: means the insuring, guaranteeing, or indemnifying of an owner of real or personal property or the holder of liens or encumbrances on that property, or others interested in the property against loss or damage suffered by reason of liens or encumbrances upon, defects in, or the unmarketability of the title to the property, or invalidity or unenforceability of any liens or encumbrances on the property. See Utah Code 31A-1-301
  • Title marketing representative: means a person who:
    (a) represents a title insurer in soliciting, requesting, or negotiating the placing of:
    (i) title insurance; or
    (ii) escrow services; and
    (b) does not have a title examination or escrow license as provided in Section 31A-23a-106. See Utah Code 31A-23a-102
  • Trust account: A general term that covers all types of accounts in a trust department, such as estates, guardianships, and agencies. Source: OCC
  • (a)  A person that receives a new license under this title as an agency title insurance producer shall at the time of licensure be owned or managed by at least one individual who is licensed for at least three of the five years immediately preceding the date on which the agency title insurance producer applies for a license with both:

    (i)  a title examination line of authority; and

    (ii)  an escrow line of authority.

    (b)  An agency title insurance producer subject to Subsection (1)(a) may comply with Subsection (1)(a) by having the agency title insurance producer owned or managed by:

    (i)  one or more individuals who are licensed with the title examination line of authority for the time period provided in Subsection (1)(a); and

    (ii)  one or more individuals who are licensed with the escrow line of authority for the time period provided in Subsection (1)(a).

    (c)  A person licensed as an agency title insurance producer shall at all times during the term of licensure be owned or managed by at least one individual who is licensed for at least three years within the preceding five-year period with both:

    (i)  a title examination line of authority; and

    (ii)  an escrow line of authority.

    (d)  The Title and Escrow Commission may by rule, subject to Section 31A-2-404, exempt an attorney with real estate experience from the experience requirements in Subsection (1)(a).

    (e)  An individual who satisfies the requirements of this Subsection (1) is known as a “qualifying licensee.” At any given time, an individual may be a qualifying licensee for not more than two agency title insurance producers.
  • (2) 

    (a)  An individual title insurance producer or agency title insurance producer appointed by an insurer shall maintain:

    (i)  a fidelity bond;

    (ii)  a professional liability insurance policy; or

    (iii)  a financial protection:

    (A)  equivalent to that described in Subsection (2)(a)(i) or (ii); and

    (B)  that the commissioner considers adequate.

    (b)  The bond, insurance, or financial protection required by this Subsection (2):

    (i)  shall be supplied under a contract approved by the commissioner to provide protection against the improper performance of any service in conjunction with the issuance of a contract or policy of title insurance; and

    (ii)  be in a face amount no less than $250,000.

    (c)  The Title and Escrow Commission may by rule, subject to Section 31A-2-404, exempt individual title insurance producer or agency title insurance producers from the requirements of this Subsection (2) upon a finding that, and only so long as, the required policy or bond is generally unavailable at reasonable rates.

    (3)  An individual title insurance producer or agency title insurance producer appointed by an insurer may maintain a reserve fund to the extent money was deposited before July 1, 2008, and not withdrawn to the income of the individual title insurance producer or agency title insurance producer.

    (4)  An examination for licensure shall include questions regarding the examination of title to real property.

    (5)  An individual title insurance producer may not perform the functions of escrow unless the individual title insurance producer has been examined on the fiduciary duties and procedures involved in those functions.

    (6)  The Title and Escrow Commission may adopt rules, establishing an examination for a license that will satisfy this section, subject to Section 31A-2-404, and after consulting with the commissioner’s test administrator.

    (7)  A license may be issued to an individual title insurance producer or agency title insurance producer who has qualified:

    (a)  to perform only examinations of title as specified in Subsection (4);

    (b)  to handle only escrow arrangements as specified in Subsection (5); or

    (c)  to act as a title marketing representative.

    (8) 

    (a)  A person licensed to practice law in Utah is exempt from the requirements of Subsections (2) and (3) if that person issues 12 or less policies in any 12-month period.

    (b)  In determining the number of policies issued by a person licensed to practice law in Utah for purposes of Subsection (8)(a), if the person licensed to practice law in Utah issues a policy to more than one party to the same closing, the person is considered to have issued only one policy.

    (9)  A person licensed to practice law in Utah, whether exempt under Subsection (8) or not, shall maintain a trust account separate from a law firm trust account for all title and real estate escrow transactions.

    Amended by Chapter 330, 2015 General Session