The American Land Title Association (ALTA) testified Thursday, June 25, 2009 in Annapolis, Md., during a public hearing held by the Maryland Insurance Commission (MIC) to Study the Title Insurance Industry. 

Notably,  no community members voiced concern to the commission. More than 35 title insurance professionals listened to testimony from 10 individuals, including Justin Ailes, ALTA’s director of government affairs. Testimony from those in attendance centered on three (3) main points:

• Consumer complaints reported by the Maryland Insurance Administration,
• Who is qualified to conduct closings and
• The cost of title insurance and the amount in claims the industry pays out.

The Maryland commission was established in 2008 to make recommendations for changes to state laws relating to the title insurance industry and is co-chaired by Sen. Delores Kelley and Del. David Rudolph. The commission will hold its final of five hearings July 16, 2009 in Baltimore.

The commission invited members of the public to testify on issues or concerns relating to:

• Title insurance,
• Title agents,
• The manner in which real estate settlement practices are conducted,
• The handling of real estate escrow accounts,
• And any difficulties that a person may have experienced with the title insurance
  industry.

ALTA provided testimony regarding the value of title insurance. It was suggested that if there was legislation that came out of the commission, it would be more successful if it has full buy-in from the industry. 

The commission was informed that ALTA has a program called the Title Industry Consumer Initiative, which is a multi-faceted strategy for improving oversight of the industry and educating and protecting consumers.

ALTA is supporting the Borrower Right of Inspection, developing legislation that has not yet been introduced but would require lenders to provide closing and settlement documents to consumers 24 hours before closing.

Darlene Arnold, senior enforcement officer of the Maryland Insurance Administration(MIA), shared the breakdown of complaints received by the administration.

• Of the 392 complaints received so far this year, 245 were title insurance related.
• Of the 245 complaints, 106 are alleged violations of trust requirements,
• 92 relate to surety and fidelity bond issues,
• 13 are from alleged failure to record documents in a timely manner,
• 12 are from alleged illegal disbursement of funds from escrow accounts and
• 10 alleged instances of failure to pay property taxes.

Many in attendance wanted better clarification on the complaints, and how many have already been resolved. The meeting was closed, after nearly three hours of testimony, by indicating that the commission was only in a learning mode at this point, and urged those in attendance to bring consumers to share their stories relating to the closing process.

Tags: Maryland Insurance Commission Title Testimony, Title Insurance

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