Monday, July 06, 2009

TIRBOP revises rate filing

They have withdrawn their request to change the rate premium structure. They are still seeking approval of a new CSL including an increase in the CSL fee from $35 to $75.

Amended Rate Filing

Original Rate filing

Here's my comment to the PA Dept. of Insurance concerning the amended rate filing:

I'd like to offer these comments concerning the request by TIRBOP to increase the CSL fee to $75 and extend coverage to consumers.

Let's give consumers a choice.

We know mortgage lenders will require a CSL, most do. Do purchasers need or desire the type of coverage offered in the CSL? Perhaps. Should a purchaser in a mortgage transaction be forced to pay for the coverage if they do not want it?

I would think the purchaser most at risk of financial loss in a defalcation is the purchaser buying property without a mortgage, paying cash. If there is value in the extra coverage offered in the CSL, will it be available to cash purchasers and should they be forced to pay for lender coverage?

In addition, there are two other parties who suffer when a title agent goes south with the money, and that's the seller and a borrower in a refinance. I realize that neither of those parties are purchasing a title insurance policy and perhaps for that reason the coverages offered under a CSL cannot be extended to them for a fee.

From a title agent point of view, this new CSL isn't going to impact me directly. As a professional who tries to keep the interest of the consumer in the radar of decisionmakers, I think the underlying question is really what causes losses covered by the CSL and how best to prevent these losses so that our title companies remain solvent an the public isn't damaged.

I continue to be a proponent of annual independent CPA audits of title agents. Raising the bar of quality in our licensing and regulatory process will do more to fix our solvency problems and uncovered consumer/lender losses than just tossing money in the CSL bin.

I know there are some in the industry who will argue that consumers do not understand the risks and therefore will not understand that they need this coverage. I tend to trust consumers to make their own decision about how they want to spend their hard earned dollars provided they have been given sufficient data and a chance to think.


Diane Cipa

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