Title Agency

1. Are there any restrictions for the name of my title agency?
   Yes. Florida Statutes §626.8413 states a title agency “…shall not adopt a name which contains the words "title insurance," "title guaranty," or "title guarantee," unless such words are followed by the word "agent" or "agency" in the same size and type as the words preceding them…”
2. Will a background check be performed?
   Yes. The department will propound reasonable interrogatories in addition to those contained in the application to protect the public and ascertain the applicant’s qualifications, in addition to the examination required to be taken before a license is issued. The background check must include submission of the applicant’s fingerprints to the Florida Department of Law Enforcement (FDLE) and the Federal Bureau of Investigation (FBI) to review any local, state or federal criminal records of the applicant. [Florida Statutes § 626.201]
   
   In addition, insurers appointing a title agency for the first time will secure on the officers of the agency a detailed credit and character report for the 5-year period immediately prior to the date of application for appointment. Information contained in credit and character reports furnished to the department are confidential and exempt from the public disclosure requirements. [Florida Statutes 626.842]
3. Where can I find the title agency bond form?
   Click here for the forms page and look under "Bond Forms."
4. What are the requirements for an agent-in-charge?
   The agent-in-charge for a title agency must be a licensed and appointed title agent or an attorney in good standing with the Florida Bar.
5. How do I license a branch location for a title agency?
   Title agencies do not require branch licenses. The license of the main office may be used for each branch location, which means that a violation discovered at one branch could affect all the locations. In addition, each branch location that does title insurance work must designate an agent-in-charge and notify the department of the identity of the person designated.
   
   Offices that perform closings only do not need to be licensed and do not need a licensed agent at that location.
6. What fees may I charge on the settlement statement form?
   The only amounts that may be charged by a title agency for issuing the title Insurance and completing the closing are:
   • Closing Services - “Closing services” means services performed by a licensed title insurer, title Insurance agent or agency, or attorney agent in the agent’s or agency’s capacity as such, including, but not limited to, preparing documents necessary to close the transaction, conducting the closing, or handling the disbursing of funds related to the closing in a real estate closing transaction in which a title insurance commitment or policy is to be issued.
   • Title Search - “Title search” means the compiling of title information from official or public records.
   • Premium - “Premium” means the charge, as specified by rule of the commission that is made by a title insurer for a title insurance policy including the charge for performance of primary title services by a title insurer or title insurance agent or agency.
   No other charges are authorized by the Florida Statutes to be charged by a title insurance agent or agency for these services.
7. Can I use an outside notary to assist with performing closings for my title agency?
   Yes. However, this would be an expense of the title agency and not an expense of the closing file. The cost for this service should be calculated in the closing services fee recorded on line 1100 of the settlement statement form. The notary service is conducting the closing which is clearly defined in Florida Statute §627.7711(1)(a) as being part of the closing services. By hiring an outside vendor to assist your title agency, you are assuming the responsibility for that vendor as if they were your employee. The title agency will be held responsible for the closing transaction performed by the outside vendor.
8. Are there any fees I must pay each year for my title agency?
   Each licensed title insurance agency must pay $200 as an administrative surcharge by the end of January in the current year. Failure to pay this amount can result in administrative action and/or a fine being assessed against the license of the title agency.
9. Where do I send surcharge payments?
   Surcharge payments must be accompanied by the invoice in order for the funds to be properly credited to the title agency’s record. Payments may be mailed to:
   Florida Department of Financial Services
   Revenue Processing Section
   P. O. Box 6000
   Tallahassee, FL 32314-6000
   
   The address for overnight payments and federal express is:
   Florida Department of Financial Services
   Revenue Processing Section
   200 E. Gaines Street
   Tallahassee, FL 32399
10. What if I forget to pay the surcharge?
    Fines for failing to pay the surcharge start at $300 for the first occurrence and increase the more times the agency fails to make the payment by the January 30 deadline. Agencies that fail to pay the surcharge may have their license and appointments suspended until the surcharge and fines are paid.
11. How do I close my title agency?
    To close your title agency, you must first contact all title insurers of your title agency is appointed to represent. Advise them of your decision and ask them for guidance on the proper handling of the records for the policies issued for their company. The Florida Statutes require the title agent or insurer to maintain records pertinent to the issuance of the title policies. If your title agency will be closed, the insurer may need to make arrangements for maintaining your files. The title agency escrow account needs to remain open until all outstanding checks have cleared. Checks outstanding for more than 5 years can be turned over to the Bureau of Unclaimed Funds. Please visit the Bureau’s website for more information: http://www.fltreasurehunt.org/
    
    The surety bond for the title agency is required to be maintained for a period of one year after the agency loses its last appointment to represent a title insurer, per Florida statute 626.8418(2). Once you have made the arrangements noted above, send a letter on your title agency letterhead to the Department of Financial Services, along with your license. The letter must indicate you want the title agency’s license terminated and must include the last day business was conducted by the title agency.
    
    The letter of termination can be mailed to:
    Florida Department of Financial Services
    Bureau of Licensing
    200 East Gaines Street
    Tallahassee FL 32399
12. Is there a Florida Statute that requires a title agency to have a surety bond?
    No. A title insurance agency is required to deposit with the department securities having a market value of not less than $35,000 at all times. In lieu of this deposit, a title insurance agency may elect to obtain a surety bond for that amount. The bond must be payable to the department for the benefit of any appointing insurer damaged by a violation of its contract with the title insurance agency. [Florida Statutes §626.8418(2)]
    
    The title insurance agency must have either the deposit or the surety bond in place in order to continue to write title insurance in Florida.
13. Is there a Florida Statute that requires a title agency to have E&O insurance?
    Yes. The title insurance agency is required to carry errors and omissions insurance in an amount acceptable to the insurer appointing the agency. The amount of coverage may not be less than $250,000 per claim with a deductible no greater than $10,000. [Florida Statutes §626.8419(1)(b)]
14. Does a title agency need to have a fidelity bond?
    Yes. Title insurance agencies must obtain a fidelity bond in an amount not less than $50,000 and acceptable to the insurer appointing the agency. [Florida Statutes §626.8419(1)(a)]
15. How long must I maintain records?
    Title agents must maintain records for 7 years pursuant to Florida Statute 627.7845(2) which state:
    
    “The title insurer shall cause the evidence of the determination of insurability and the reasonable title search or search of the records of a Uniform Commercial Code filing office to be preserved and retained in its files or in the files of Its title insurance agent or agency for a period of not less than 7 years after the title insurance commitment, title insurance policy, or guarantee of title was issued. The title insurer or agent or agency must produce the evidence required to be maintained by this subsection at its offices upon the demand of the office. Instead of retaining the original evidence, the title insurer or the title insurance agent or agency may, in the regular course of business, establish a system under which all or part of the evidence is recorded, copied, or reproduced by any photographic, photo static, microfilm, micro card, miniature photographic, or other process which accurately reproduces or forms a durable medium for reproducing the original,”
16. How long must I maintain escrow records?
    Escrow Account records must be maintained in accordance with Florida Administrative Code 690-186.009 which states “Every licensed title insurance agent shall maintain a monthly reconciliation of every escrow account required to be maintained pursuant to Florida Statute 626.8473 and shall, on a monthly basis, report such reconciliation together with appropriate supporting documentation to each title insurer which licensed the agent during the reconciliation period. The reconciliation shall be supported by appropriate documentation, including a monthly bank statement, a list of all outstanding checks as of the date of the reconciliation which is not shown on the monthly bank statement, and a trial balance of the escrow ledger records required to be maintained by subsection (2). Licensed title insurance agents and title insurers shall provide a copy of the monthly escrow account reconciliation to the Office upon Its request. Such records shall be maintained by the title insurer for a period of five years.” Also part (2) states, “Every licensed title insurance agent shall maintain a separate ledger card for each real estate closing transaction for which funds are received in escrow. The ledger card shall contain chronological entries of dates and amounts of moneys received and disbursed including the name of the remitter and payee and each check number issued on such escrow account. Such records shall be maintained by the title insurance agent for a period of three years. The ledger card required by this rule may be maintained in computer storage with a print-out available upon request of a title insurer or the Office.
17. Can our agency pay real estate agents, brokers or others for each piece of business they send to us?
    No. The Florida Statutes prohibit title insurance agents and agencies from paying, allowing, giving, or offering to pay, allow or give a direct or indirect inducement for the purchase of title insurance. Paying someone for each piece of business they send to you would be considered an inducement, which would be a violation of the statutes. [Florida Statutes §626.9541(1)(h)3.a.]
18. What about the closing process?
    Click here to see the Title Closing FAQ.
19. Who selects the title agency to be used to issue the title insurance?
    The person paying the premium.
20. Can I help the brokers that send me business by holding open houses for them?
    No. While we understand your desire to assist the people that are assisting you to increase your business, holding open houses for brokers would be viewed as an unfair trade practice and an inducement for the future sale of title insurance.
21. Can a title agency advertise?
    Yes. The ad must be honest and accurate. It should promote the title agency and not any other business. If the title agency places an ad that solicits customers for any other business, it may be viewed as an unfair trade practice and an inducement for the future purchase of insurance.
22. Can the agency advertise they offer rebates?
    Yes. Again the advertisement must be truthful and not be misleading. The advertisement cannot say the agency is discounting the title insurance premium, as that is misleading and inaccurate. The agency must charge the promulgated rate for title insurance and then the agency may rebate any portion of their share of the premium.
    Some examples: Advertising that your agency charges the lowest rates is misleading in that everyone must charge the same rates in Florida. Stating your agency reduces the title insurance premium by 20% is deceptive. You must charge the same rate, but you could provide a rebate of your portion of the premium that equates to 20% of the full premium.
23. Who can act as an Escrow agent in Florida?
    Only a Licensed Title Agent; Attorney; Financial Institution; or Licensed Real Estate Agent.
24. Can I arrange for my bank to sweep my escrow account at night to earn a higher interest rate, which will allow me to offset my overhead expenses?
    The Florida Statutes provide detailed directions as to the types of accounts and investments that may be used for escrow accounts. These requirements are the same for the entire day, night just during business hours. Florida Statutes §626.8473(3) states the funds must be immediately placed in a financial institution that is a member of the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Share Insurance Fund (NCUSIF). This means the funds may be invested in any type of investment that meets the requirements of Florida Statute §17.57 as long as it is an account that is maintained with a member of the FDIC or the NCUSIF.
    
    Florida Administrative Code 69O-186.008 prohibits a title insurance agent or title insurer from endangering the funds entrusted to them through the escrow process. In addition, this section of the code sets forth the procedures for accepting escrow funds and disbursing against the funds collected. A title insurance agent or insurer may only disburse on funds that are in the escrow at the time of the closing, or it is reasonable to expect the money is in the account at that time.
    
    Florida Administrative Code 69O-186.008(4) adds that funds received in excess of the insured amount must be deposited in a financial institution that has a rating not less than the minimum standards established by the Government National Mortgage Association (GNMA). Basically these requirements state the funds must be invested in an account at an institution that is a member of an Automated Clearing House (ACH) or a correspondent of a member. It also must be rated by a suitable rating agency and receive an acceptable rating.
    
    A title insurance agent, agency, or title insurer could allow for escrow funds to be “swept” into another investment account provided:
    
    The funds are still maintained in an account that meets investment guidelines of the Florida Statutes and the Florida Administrative Code.
    
    
    • The buyer and the seller have both agreed at the time of deposit to allow the title insurance agent, agency or title insurer to earn interest on the escrow funds.
    • The buyer and the seller have agreed to the terms and the provisions of the investment agreement that transfers the funds from the escrow into any other acceptable account.
    • The investment grade of the account being used meets the Federal and State guidelines.
    • The funds will be available for disbursement at the time of closing.
    
    Any deviation from the Florida Statutes and the Florida Administrative Code could be considered as grounds for administrative action against the agent, the agency, or the insurer. A person engaging in this type of investment strategy would need to be very careful not to violate the multitude of provisions in the Florida Statutes, the Florida Administrative Code, and possibly some federal regulations.
    
    Unless advance permission has otherwise been granted by the escrow depositor, it has always been the position of this Department that escrow accounts utilized in moving the funds to various other investments, such as sweep accounts, are not in compliance with the Florida Insurance Code, particularly Section 626.8473(3), Florida Statutes, which requires escrow funds to at all times be maintained under protection of the FDIC or NCUSIF. Accordingly, we will pursue action against any licensee that we discover is engaging in this practice.
    
25. What if I have other questions that are not addressed here?
    You can send your specific question or concern via email at title@myfloridacfo.com.
    
    You can also mail or fax your request to:
    
    Department of Financial Services
    Bureau of Investigation Title Section
    200 East Gaines Street
    Tallahassee, FL 32399-0320
    (850) 488-5951 (Fax)

back to top