WSR 12-08-024

EMERGENCY RULES

OFFICE OF

INSURANCE COMMISSIONER

[ Insurance Commissioner No. R 2012-07 -- Filed March 28, 2012, 11:19 a.m. , effective March 28, 2012, 11:19 a.m. ]


Effective Date of Rule: Immediately.

Purpose: Following the adoption of WAC 284-29A-110, the National Association of Insurance Commissioners (NAIC) task force on title insurance statistical reporting, after working with the title insurance industry, adopted a guideline for title insurance agents to report financial data to insurance commissioners. The commissioner is considering amending the current rules, which require title insurance agents to submit data to the insurance company(s), to adopt the NAIC guideline. In an effort to avoid unnecessary administrative filings under the current rules, the commissioner is postponing the current requirement for title insurance agents to submit the data to the title insurance company(s) and postponing the change to the prior approval system in order to implement the NAIC guideline.

Citation of Existing Rules Affected by this Order: Repealing [amending] WAC 284-29A-110 and 284-29A-030.

Statutory Authority for Adoption: RCW 48.02.060 and 48.29.005.

Under RCW 34.05.350 the agency for good cause finds that immediate adoption, amendment, or repeal of a rule is necessary for the preservation of the public health, safety, or general welfare, and that observing the time requirements of notice and opportunity to comment upon adoption of a permanent rule would be contrary to the public interest.

Reasons for this Finding: Without the postponement of WAC 284-29A-110, title insurance agents are required to prepare and submit filings that the commissioner is considering amending. Without an emergency rule, title insurance agents would be required to submit a report to their title insurance company(s) in a manner that is being amended. The implementation of the prior approval rate filing system for an additional year is also being postponed.

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 2, Repealed 1.

Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 2, Repealed 1.

Date Adopted: March 28, 2012.

Mike Kreidler

Insurance Commissioner

OTS-4679.1


AMENDATORY SECTION(Amending Matter No. R 2011-07, filed 7/27/11, effective 8/27/11)

WAC 284-29A-030   Transition to prior approval system.   (1) On and after January 1, ((2013)) 2014, all rates used in Washington state must be filed and approved under RCW 48.29.147.

(2) Title insurers must submit the rate filings required under RCW 48.29.147 and subsection (1) of this section to the commissioner by September 1, ((2012)) 2013, for rates to be effective on January 1, ((2013)) 2014. This rule allows the commissioner time to take final action on rates filed under this chapter before the effective date of January 1, ((2013)) 2014.

(3) Rates filed under RCW 48.29.140(2) must not be used for commitments issued on or after January 1, ((2013)) 2014.

[Statutory Authority: RCW 48.02.060 and 48.29.140. 11-16-031 (Matter No. R 2011-07), 284-29A-030, filed 7/27/11, effective 8/27/11. Statutory Authority: RCW 48.02.060 and 48.29.005. 10-15-092 (Matter No. R 2009-01), 284-29A-030, filed 7/20/10, effective 8/20/10.]


AMENDATORY SECTION(Amending Matter No. R 2009-01, filed 7/20/10, effective 8/20/10)

WAC 284-29A-110   Title insurance agents must report data to title insurers.   (1) Each title insurance agent must report premium, policy count, and expense data annually to each title insurer for which it produces business in the state of Washington by April 1st of each year, except as provided in subsection (4) of this section. These data must be reported following the instructions published by the commissioner on the commissioner's web site at www.insurance.wa.gov. These instructions, called the Title Insurance Agent Annual Report, are incorporated into this chapter by reference.

(2) Each annual report required by this section must include:

(a) The following premium and policy count data:

(i) Title insurance premiums for all of the agent's business; and

(ii) Title insurance premiums produced for the title insurer to which the report is sent.

(iii) Number of policies issued by all of the title insurers with which the agent does business; and

(iv) Number of policies issued by the title insurer to which the report is sent.

(b) The following expense data related to issuing title insurance policies and commitments for all of the agent's business, excluding all expenses related to escrow and other activities not directly related to title insurance:

(i) Employees' salaries and wages;

(ii) Owners' and partners' salaries and wages representing reasonable compensation for personal services actually performed by owners and partners;

(iii) Employee benefits;

(iv) Rent;

(v) Insurance;

(vi) Legal expense;

(vii) Licenses, taxes, and fees;

(viii) Title plant expense and maintenance;

(ix) Office supplies;

(x) Depreciation;

(xi) Automobile expense;

(xii) Communication expense;

(xiii) Education expense;

(xiv) Bad debts;

(xv) Interest expense;

(xvi) Employee travel and lodging;

(xvii) Loss and loss adjustment expense;

(xviii) Accounting and auditing expense;

(xix) Public relations expense; and

(xx) Other specifically identified expenses.

(c) An explanation that:

(i) Describes how expenses are allocated between the title operations and escrow or other operations of the title insurance agent; and

(ii) Demonstrates that the expenses described in WAC 284-29A-070(2) have been excluded.

(d) The estimated average cost to issue a title insurance commitment.

(3) If a title insurer does not receive a report required under this section by April 1st of each year, the title insurer must notify the commissioner by April 15th. This notice must include the name of the agent that did not send the report on time.

(4) For the 2011 calendar year report, each title agent must submit the report to the title insurer(s) on or before April 1, 2013.

[Statutory Authority: RCW 48.02.060 and 48.29.005. 10-15-092 (Matter No. R 2009-01), 284-29A-110, filed 7/20/10, effective 8/20/10.]

Washington State Code Reviser's Office