The Alabama Department of Insurance amended Chapter 482-1-148, Title Insurance Agents, which puts forth its title agent licensing and compliance regulations. The amendments go into effect Jan. 1, 2024.
The regulations require individuals to successfully pass an examination before being licensed as a title insurance agent. Individuals are exempt from this requirement if:
- If, on or before March 31, 2013, the individual can establish to the satisfaction of the commissioner that from Jan. 1, 2008, to Dec. 31, 2012, the individual was an authorized signatory for title commitments, title insurance policies, and title insurance policy endorsements on behalf of a title insurer properly authorized to conduct the business of title insurance in this state.
- The individual was previously licensed as a title insurance agent in this state after having passed the examination or being exempt from the examination under paragraph (a), but only if the application is received within 12 months of the cancellation of the individual’s previous license and if, at the time of the cancellation, the individual was in good standing with this department.
If an individual fails the examination two times, the individual must wait at least 90 days before taking the examination again. If an individual fails the examination two additional times, the individual must wait at least 180 days before taking the test again. The individual will pay a non-refundable fee of $75 for each examination attempt.
The regulation also states, “All title insurance commitments, policies and endorsements issued by a title insurance agent and insuring an interest in real property situated in this state must be issued and signed by a duly licensed and appointed title insurance agent. The signature block shall contain the license number for the issuing agent and of the signing agent.”
Business entities wishing to be licensed as a title insurance agent must be Alabama entities property formed and existing under Alabama law and have their principal place of business physically located in the state. Sole proprietors may only be licensed as individual agents. Entities must identify at least one licensed individual title insurance agent designated as responsible for the entity’s compliance with applicable laws, rules and regulations, and designated to act as a signatory on title insurance commitments, policies and endorsements issued by the entity. The licensed individual must have a degree of affiliation with the entity that reasonably assures that the licensed individual agent can cause or influence the entity’s compliance with all applicable laws, rules, and regulations. Business entity licensees must be appointed by each title insurer they represent.
Under the regulation, an individual may be issued a title insurance agent license if the individual is at least 19 years old and is either an Alabama resident or a non-Alabama resident who is employed full time by a duly licensed title agent whose principal place of business is in Alabama. They must complete the online licensing process and be appointed to act on behalf of a title insurer and appointed by each insurer they represent.
Licenses must be renewed every other year.
“The license of any individual or business entity title insurance agent failing to complete the application for license renewal within the time specified in paragraph (2) of Rule 482-1-148-.08 will expire but there is a 30-day grace period following the expiration during which time the licensee can renew with payment of the late fee plus the renewal fee. If the licensee shall complete the application for license renewal prior to the end of said 30-day grace period, along with the payment of the applicable fees, the license will not expire.”
If a title agent license is not renewed, the license expires and all title insurer appointments are canceled. The agent can reapply within 12 months without having to retake the examination. Once their license is reinstated, they may again be appointed by insurers. If a former licensee applies for a license more than 12 months after their license expired, they must comply with all applicable examination requirements before again applying for a title insurance license.
Individual licensees must satisfactorily complete continuing education courses accounting for at least 24 classroom hours, including three hours of ethics education. If a licensee completing an application for license renewal fails to meet the educational requirements within the prescribed time, the license will not be renewed until the licensee has completed the educational requirements.
All individual and business entity title insurance agents must be appointed by any and all title insurers they represent. The appointments must be handled online through the National Insurance Producer Registry (NIPR).
In regard to disciplinary action, the regulation states, “By means of a settlement agreement and consent order, or by order issued after other appropriate administrative proceedings, an applicant may be issued a license on a probationary basis, or an existing licensee may be placed on probation for a specified period of time or until certain specified conditions are met. A licensee on probation is allowed to become or remain licensed and to renew an existing license, as applicable, if the licensee has complied or is complying with the conditions specified in the settlement agreement, consent order, or other order imposing the probation during the stated term of the probation. During the term of the probation, the licensee remains subject to all applicable requirements of the Insurance Code, including, but not limited to, requirements concerning continuing education and license renewal. If so stated in the settlement agreement and consent order or in the order imposing the probation, failure to comply with the conditions set forth in the probation order may result in the immediate suspension or revocation of the license without further administrative proceedings.”
It further states, “By means of a settlement agreement and consent order, or by order issued after other appropriate administrative proceedings, the license of a licensee may be suspended for either a specified period of time or until certain specified conditions are complied with subject to the following:
- “During the term of the suspension, the licensee may not engage in any actions or activity for which the license is required but remains subject to all applicable requirements of the Insurance Code, including, but not limited to, requirements concerning continuing education.
- “A suspended license may not be renewed if the renewal date occurs during the suspension term.
- “A suspension is lifted upon expiration of its term or, if based on compliance with specified conditions, by an order issued upon the licensee’s showing that the conditions have been met or complied with, or by an order issued after consideration of an application to lift the suspension has been submitted by the licensee. Upon lifting of the suspension, the license is deemed reinstated unless the license has expired or has otherwise terminated during the suspension term.
- “If the license has expired or otherwise terminated during the suspension term less than twelve (12) months before the date on which the suspension is lifted, the licensee may immediately apply for a license without complying with any applicable examination requirements but will be subject to any applicable continuing education requirements. If over twelve (12) months have elapsed between the expiration or other termination of the license and lifting of the suspension, the licensee must comply with any applicable examination requirements prior to applying for the license.”
A licensee’s voluntary surrender of a license in lieu of administrative proceedings will be deemed a revocation for purposes of the regulation’s provisions. After that date, the licensee may not engage in any actions or activities for which the license is required. The licensee must apply to the commissioner to apply for any form of license issued through the department.
It repeals sections 482-1-148-.03 to 482-1-148.05 and 482-1-148-.14.