| ||||
| Public Act 098-0832 | ||||
| ||||
| ||||
AN ACT concerning regulation.
| ||||
Be it enacted by the People of the State of Illinois,
| ||||
represented in the General Assembly:
| ||||
Section 5. The Title Insurance Act is amended by changing | ||||
Section 16 as follows:
| ||||
(215 ILCS 155/16) (from Ch. 73, par. 1416)
| ||||
Sec. 16. Title insurance agents.
| ||||
(a) No person, firm, partnership, association, corporation | ||||
or other
legal entity shall act as or hold itself out to be a | ||||
title insurance agent
unless duly registered by a title | ||||
insurance company with the Secretary.
| ||||
(b) Each application for registration shall be made on a | ||||
form specified
by the Secretary and prepared in duplicate by | ||||
each title insurance company
which the agent represents. The | ||||
title insurance company shall retain the
copy of the | ||||
application and forward the original to the Secretary with the
| ||||
appropriate fee.
| ||||
(c) Every applicant for registration, except a firm, | ||||
partnership,
association, limited liability company, or | ||||
corporation, must be 18 years or more of age. Included in every | ||||
application for registration of a title insurance agent, | ||||
including a firm, partnership,
association, limited liability | ||||
company, or corporation, shall be an affidavit of the applicant | ||||
title insurance agent, signed and notarized in front
of a | ||
notary public, affirming that the applicant and every owner, | ||
officer, director, principal, member, or
manager of the | ||
applicant has never been convicted or pled guilty to any felony | ||
or misdemeanor involving a crime of
theft or dishonesty or | ||
otherwise accurately disclosing any such felony or misdemeanor | ||
involving a crime of
theft or dishonesty. No person who has had | ||
a conviction or pled guilty to any felony or
misdemeanor | ||
involving theft or dishonesty may be registered by a title | ||
insurance company without a separate written notification to | ||
the Secretary disclosing the conviction or plea, and no such
| ||
person may serve as an owner, officer, director, principal, or | ||
manager of any registered title insurance
agent without the | ||
written permission of the Secretary.
| ||
(d) Registration shall be made annually by a filing with | ||
the Secretary;
supplemental registrations for new title | ||
insurance agents to be added
between annual filings shall be | ||
made from time to time in the manner
provided by the Secretary; | ||
registrations shall remain in effect unless
revoked or | ||
suspended by the Secretary or
voluntarily withdrawn by the
| ||
registrant or the title insurance company.
| ||
(e) Funds deposited in connection with any escrows, | ||
settlements, or closings shall be deposited in a separate | ||
fiduciary trust account or accounts in a bank or other | ||
financial institution insured by an agency of the federal | ||
government unless the instructions provide otherwise. The | ||
funds shall be the property of the person or persons entitled | ||
thereto under the provisions of the escrow, settlement, or | ||
closing and shall be segregated by escrow, settlement, or | ||
closing in the records of the escrow agent. The funds shall not | ||
be subject to any debts of the escrowee and shall be used only | ||
in accordance with the terms of the individual escrow, | ||
settlement, or closing under which the funds were accepted. | ||
Interest received on funds deposited with the escrow agent | ||
in connection with any escrow, settlement, or closing shall be | ||
paid to the depositing party unless the instructions provide | ||
otherwise. | ||
The escrow agent shall maintain separate records of all | ||
receipts and disbursements of escrow, settlement, or closing | ||
funds. | ||
The escrow agent shall comply with any rules adopted by the | ||
Secretary pertaining to escrow, settlement, or closing | ||
transactions. | ||
(f) A title insurance agent shall not act as an escrow | ||
agent in a nonresidential real property transaction where the | ||
amount of settlement funds on deposit with the escrow agent is | ||
less than $2,000,000 or in a residential real property | ||
transaction unless the title insurance agent, title insurance | ||
company, or another authorized title insurance agent has | ||
committed for the issuance of title insurance in that | ||
transaction and the title insurance agent is authorized to act | ||
as an escrow agent on behalf of the title insurance company for | ||
which the commitment for title insurance has been issued. The | ||
authorization under the preceding sentence shall be given | ||
either (1) by an agency contract with the title insurance | ||
company which contract, in compliance with the requirements set | ||
forth in subsection (g) of this Section, authorizes the title | ||
insurance agent to act as an escrow agent on behalf of the | ||
title insurance company or (2) by a closing protection letter | ||
in compliance with the requirements set forth in Section 16.1 | ||
of this Act, issued by the title insurance company to the | ||
seller, buyer, borrower, and lender. A closing protection | ||
letter shall not be issued by a title insurance agent. The | ||
provisions of this subsection (f) shall not apply to the | ||
authority of a title insurance agent to act as an escrow agent | ||
under subsection (g) of Section 17 of this Act. | ||
(g) If an agency contract between the title insurance | ||
company and the title insurance agent is the source of the | ||
authority under subsection (f) of this Section for a title | ||
insurance agent to act as escrow agent for a real property | ||
transaction, then the agency contract shall provide for no less | ||
protection from the title insurance company to all parties to | ||
the real property transaction than the title insurance company | ||
would have provided to those parties had the title insurance | ||
company issued a closing protection letter in conformity with | ||
Section 16.1 of this Act. | ||
(h) A title insurance company shall be liable for the acts | ||
or omissions of its title insurance agent as an escrow agent if | ||
the title insurance company has authorized the title insurance | ||
agent under subsections (f) and (g) of this Section 16 and only | ||
to the extent of the liability undertaken by the title | ||
insurance company in the agency agreement or closing protection | ||
letter. The liability, if any, of the title insurance agent to | ||
the title insurance company for acts and omissions of the title | ||
insurance agent as an escrow agent shall not be limited or | ||
otherwise modified because the title insurance company has | ||
provided closing protection to a party or parties to a real | ||
property transaction escrow, settlement, or closing. The | ||
escrow agent shall not charge a fee for protection provided by | ||
a title insurance company to parties to real property | ||
transactions under subsections (f) and (g) of this Section 16 | ||
and Section 16.1, but shall collect from the parties the fee | ||
charged by the title insurance company and shall promptly remit | ||
the fee to the title insurance company. The title insurance | ||
company may charge the parties a reasonable fee for protection | ||
provided pursuant to subsections (f) and (g) of this Section 16 | ||
and Section 16.1 and shall not pay any portion of the fee to | ||
the escrow agent. The payment of any portion of the fee to the | ||
escrow agent by the title insurance company, shall be deemed a | ||
prohibited inducement or compensation in violation of Section | ||
24 of this Act. | ||
(i) The Secretary shall adopt and amend such rules as may | ||
be required for the proper administration and enforcement of | ||
this Section 16 consistent with the federal Real Estate | ||
Settlement Procedures Act and Section 24 of this Act. | ||
(Source: P.A. 98-398, eff. 1-1-14.)
| ||