TITLE 13 INSURANCE
CHAPTER 14 TITLE
INSURANCE
PART 9 GENERAL
RATE PROVISIONS
13.14.9.1 ISSUING AGENCY:
Office of Superintendent of Insurance (“OSI”).
[13.14.9.1 NMAC – Rp,
13.14.9.1 NMAC, 1/1/2021]
13.14.9.2 SCOPE: This
rule applies to all title insurers, title insurance agencies, and title
insurance agents conducting the business of title insurance in New Mexico.
[13.14.9.2 NMAC – Rp, 13.14.9.2 NMAC, 1/1/2021]
13.14.9.3 STATUTORY
AUTHORITY: Sections 59A-2-8, 59A-2-9, 59A-30-4, 59A-30-6,
59A-30-6.1, 59A-30-6.2 and 59A-30-8 NMSA 1978.
[13.14.9.3 NMAC – Rp, 13.14.9.3 NMAC, 1/1/2021]
13.14.9.4 DURATION:
Permanent.
[13.14.4 NMAC – Rp,
13.14.9.4 NMAC, 1/1/2021]
13.14.9.5 EFFECTIVE DATE: January
1, 2021, unless a later date is cited at the end of a section.
[13.14.9.5 NMAC –
Rp, 13.14.9.5 NMAC, 1/1/2021]
13.14.9.6 OBJECTIVE: To establish matters related to the promulgation of title
insurance rates and charges.
[13.14.9.6 NMAC –
Rp, 13.14.9.6 NMAC, 1/1/2021]
13.14.9.7 DEFINITIONS: See
13.14.1 NMAC.
[13.14.9.7 NMAC –
Rp, 13.14.9.7 NMAC, 1/1/2021]
13.14.9.8 SCHEDULE OF PREMIUM RATES: The rates and charges authorized by these rules shall be established by order of the superintendent in a title rate case conducted pursuant to Subsection A of Section 59A-30-8 NMSA 1978, or as amended or supplemented by order issued after a hearing conducted pursuant to Subsection B of Section 59A-30-8 NMSA 1978. All references to rates and charges shall mean the rates and charges established by the superintendent’s order in the most recent rate hearing case, including any amending or supplementing order, in effect at the time the premium or charge is incurred. On his own motion, or at the request of an interested person, the superintendent may, at any time, conduct a formal or informal hearing to consider whether to promulgate a new or amended rate or charge.
[13.14.9.8 NMAC – Rp, 13.14.9.8 NMAC, 1/1/2021]
13.14.9.9 COMBINATIONS
OF CREDITS OR DISCOUNTS: No title insurer or title insurance agency shall
grant more than one premium credit, reduction or discount for a single
transaction, unless one original owner policy premium in the largest amount is
charged; provided, however, that a simultaneous issue rate regulation may be combined
with any appropriate single issue rate regulation.
[13.14.9.9 NMAC – Rp, 13.14.9.9 NMAC, 1/1/2021]
13.14.9.10 PREMIUM
RATES INCLUSIVE: The
premium rates and charges established by the superintendent include all
premiums for title insurance, examination of the title or titles to be insured,
determining that each insured estate has been created, conveyed or modified as
shown in the policy, and determining what exceptions, if any, to insert in or
delete from the policies to be issued as provided in these rules. No other
rates or charges may be charged for title insurance or title services.
[13.14.9.10 NMAC – Rp, 13.14.9.10 NMAC,
1/1/2021]
13.14.9.11 PAYMENTS OF PREMIUM TO OTHERS: No
portion, split or percentage of any premium shall be paid either directly or
indirectly to any person, firm or organization for title insurance, title
examination, or determining status of title as set forth above, except a
division of premium between an insurer admitted to transact title insurance
business in New Mexico and its New Mexico title insurance agency pursuant to
their agency agreement, or between New Mexico title insurance agencies (or title
insurance agencies who do not have agency agreements in a county where some of
the property is located) who are cooperating to close a transaction involving
New Mexico property situated in more than one county to be insured in a single
policy when each title insurance agency or title insurer is rendering part of
the services included in the premiums established in a title rate case. Any title
insurance agency who has cancelled its agency agreement or had its agency
agreement cancelled by an underwriter may prepare endorsements to existing
policies then in force at the time of cancellation upon request by the insured
and approval by the underwriter. Any such endorsement shall be signed by an
officer of the underwriter. The premium for any such endorsement shall be
collected by the cancelled title insurance agent and divided according to the
controlling promulgated rates at the time of issuance of the endorsement(s).
The payment or receipt of referral fees by or between title insurers or
agencies and any person is prohibited.
[13.14.9.11 NMAC –
Rp, 13.14.9.11 NMAC, 1/1/2021]
13.14.9.12 REBATES AND
UNAUTHORIZED DISCOUNTS: A title insurance agency or title insurer
shall charge the applicable rates and charges for each transaction and shall
not offer or grant a credit, discount or rebate that is not authorized.
[13.14.9.12 NMAC – Rp, 13.14.9.12 NMAC, 1/1/2021]
13.14.9.13 ROUNDING TO
THE NEAREST DOLLAR: All premiums charged for title insurance
policies, endorsements, or commitments shall be rounded to the nearest dollar
after all necessary computations have been performed. Fifty cents or more shall
be rounded up; 49 cents or less shall be rounded down.
[13.14.9.13 NMAC – Rp, 13.14.9.13 NMAC, 1/1/2021]
13.14.9.14 FRACTIONAL THOUSAND
DOLLARS OF LIABILITY: To compute any premium, a $1,000 fraction of
coverage shall be calculated as a full $1,000.
[13.14.9.14 NMAC – Rp, 13.14.9.14 NMAC, 1/1/2021]
13.14.9.15 NON-DISCRIMINATION
IN AUTHORIZED DISCOUNTS: A title insurance agency or title insurer
shall charge premiums rates, charges and fees on a non-discriminatory basis for
like risks and like insureds.
[13.14.9.15 NMAC – Rp, 13.14.9.15 NMAC, 1/1/2021]
13.14.9.16 ADDITIONAL
CHARGES: Whenever
the search or examination conducted for the issuance of a policy involves
either an extra chain of title or other unusual complexity, fees shall be
charged for each additional chain of title pertaining to platted tracts and for
each tract of unusual complexity of search and examination. If the separate
values for each tract are not apportioned in the policy, their values for the
purposes of this section shall be in the same proportions as their areas bear
to the entire area insured.
[13.14.9.16 NMAC – Rp, 13.14.9.16 NMAC,
1/1/2021]
13.14.9.17 CANCELLATION
FOR NON-PAYMENT OF PREMIUM: In the event that all premium due is not paid
in full within 15 days of the issuance of any policy or endorsement, the title insurer
shall cancel the policy or endorsement. The title insurer shall mail the
insured(s) and lender notice of the cancellation by certified mail, return
receipt requested, to the last known address, and by first class mail. Cancellation
shall be effective 10 days after mailing notice to the insured. A title
insurance agency shall promptly notify the title insurer of the non-receipt of
premiums within the period specified herein.
[13.14.9.17 NMAC – Rp, 13.14.9.17 NMAC, 1/1/2021]
13.14.9.18 [RESERVED]
[13.14.9.18 NMAC – 13.14.9.18 NMAC - Rn, 13 NMAC 14.9.8.11 & A,
5/15/2000; A, 5/31/2000; A, 8/1/2000; A, 3/1/2002; A, 7/1/2003; A, 7/1/2004; A,
7/1/2005; A, 7/1/2006; A, 9/1/2007; A, 7/1/2008; A, 8/1/2009; A,
10/1/2012; A, 8/15/2014; A/E, 7/1/2018; A, 12/27/2018; Repealed 1/1/2021]
13.14.9.19 NON-POLICY
CHARGES:
A. A charge shall be collected for
the initial six months and for each additional six-month renewal or extension
(or portion thereof) of a commitment. If a new version of a commitment is
issued to correct an error by the title insurer or agency, the new version
shall be issued at no charge.
B. If the transaction fails to
close and no policy is issued, the title insurer or agency shall charge a
cancellation fee.
C. The charge for a pro forma
policy shall be established in a title rate case. If a pro forma is issued to
correct an error by the issuing title insurer or agency, the corrected version
shall be issued at no charge.
[13.14.9.19 NMAC – Rp, 13.14.9.19 NMAC,
1/1/2021]
3.14.9.20 ORIGINAL
OWNER’S POLICY SINGLE ISSUE RATES: Original owner’s policies not issued
simultaneously with another policy or policies and not as a reissue of an owner’s
policy shall be issued at the basic premium rate according to the schedule in
effect as of the date of the policy.
[13.14.9.20 NMAC – Rp, 13.14.9.20 NMAC, 1/1/2021]
13.14.9.21 ORIGINAL
POLICY INSURING LEASEHOLD ESTATE SINGLE ISSUE RATES:
Original policies insuring a leasehold estate, not issued simultaneously
with another policy and not as a reissue of a policy insuring a leasehold estate,
shall be charged at the basic premium rate according to the schedule in effect
as of the date of the policy. Original policies insuring a leasehold estate
which are reissues of original owner’s policies, including a policy pertaining
to a sale and leaseback transaction, shall qualify for the reissue rate.
[13.14.9.21 NMAC – Rp, 13.14.9.21 NMAC, 1/1/2021]
13.14.9.22 ORIGINAL LOAN
POLICY RATES: Premiums for an original loan policy shall be
determined in a title rate case.
[13.14.9.22 NMAC – Rp, 13.14.9.22 NMAC, 1/1/2021]
13.14.9.23 [RESERVED]
[13.14.9.23 NMAC – 13.14.9.23 NMAC - Rn, 13 NMAC 14.9.10.4, 5/15/2000;
Repealed 1/1/2021]
13.14.9.24 ABSTRACT
RETIREMENT CREDIT: When the applicant for an owner’s policy
transfers, at the time of application for the policy, to the title insurance agency
or title insurer ownership of the abstract of title covering all or part of the
premises to be insured, a credit shall be determined based on a percentage of
the appropriate premium for the owner’s policy.
[13.14.9.24 NMAC – Rp, 13.14.9.24 NMAC, 1/1/2021]
13.14.9.25 [RESERVED]
[13.14.9.25 NMAC – 13.14.9.25 NMAC - Rn, 13 NMAC 14.9.10.6, 5/15/2000;
Repealed 1/1/2021]
13.14.9.26 REPLACEMENT
POLICY RATE: When a title insurer is placed in
receivership, and a replacement title insurance policy is issued by a title
insurance agency, the title insurance agency’s division of premium shall be
computed in accordance with the current division ordered by the superintendent.
If a title insurer issues the policy directly, the title insurer shall retain
the full premium.
[13.14.9.26 NMAC – Rp, 13.14.9.26 NMAC, 1/1/2021]
13.14.9.27 [RESERVED]
[13.14.9.27 NMAC – Rp, 13.14.9.27 NMAC, 1/1/2021]
13.14.9.28 LIMITED PRE-FORECLOSURE TITLE
INSURANCE POLICY AND DOWNDATE ENDORSEMENT: The premium for NM form 41 and
42 shall be established in a title rate case. If an NM 41 form is issued and an
owner’s policy is issued following completion of the foreclosure, the owner’s
policy shall qualify for a reissue rate ordered by the superintendent in a title
rate case. All liability insured above the amount of the foreclosure title
insurance policy for a new owner’s policy must be computed at the basic premium
rates in the applicable bracket. If an NM form 41 is issued and if the
foreclosure is not completed or is terminated by reinstatement of the pertinent
security instrument, and a new owner’s policy is issued to a new purchaser
within one year of the date of the NM form 41, a percentage of the premium paid
for the NM form 41 shall be credited toward the new owner’s policy premium as
established by the superintendent in a title rate case.
[13.14.9.28 NMAC –
Rp, 13.14.9.28 NMAC, 1/1/2021]
13.14.9.29 [RESERVED]
[13.14.9.29 NMAC – 13.14.9.29 NMAC - Rn, 13 NMAC 14.9.10.10, 5/15/2000;
Repealed 1/1/2021]
13.14.9.30 [RESERVED]
[13.14.9.30 NMAC – 13.14.9.30 NMAC - Rn, 13 NMAC 14.9.11.1, 5/15/2000;
Repealed 1/1/2021]
13.14.9.31 [RESERVED]
[13.14.9.31 NMAC – 13.14.9.31 NMAC - Rn, 13 NMAC 14.9.11.2, 5/15/2000;
Repealed 1/1/2021]
13.14.9.32 SIMULTANEOUS
ISSUE MULTIPLE OWNER’S POLICIES ON SAME LAND:
When two or more owner’s
policies, including leasehold owner’s policies, covering the same land are:
A. issued simultaneously to
different insureds, the applicable owner’s rate shall apply to the policy in
the largest amount; or
B. issued to different insureds
where a policy is issued in one transaction and one or more policies are issued
within 30 days in a subsequent transaction or transactions, provided,
(1) each transaction covers identical
land;
(2) all conveyances relating to the
land to be insured in the subsequent transaction(s) are recorded no more than
30 days after the conveyances of the first transaction are recorded and all policies
are issued by the same title insurer or title insurance agency no later than 30
days after the first transaction; and
(3) an owner’s policy is issued
insuring the interest of each and every owner created by the subsequent
transaction(s), the premium for the first policy shall be the applicable
owner’s rate in effect as of the date of the first policy. If any subsequently
issued policy exceeds the amount of insurance written in the first policy, the
premium for the difference must be computed at the basic premium rates by
brackets.
[13.14.9.32 NMAC – Rp, 13.14.9.32 NMAC, 1/1/2021]
13.14.9.33 [RESERVED]
[13.14.9.33 NMAC – 13.14.9.33 NMAC - Rn, 13 NMAC 14.9.11.4, 5/15/2000;
Repealed 1/1/2021]
13.14.9.34 [RESERVED]
[13.14.9.34 NMAC – Rp, 13.14.9.34 NMAC, 1/1/2021]
13.14.9.35 [RESERVED]
[13.14.9.35 NMAC – 13.14.9.35 NMAC - Rn, 13 NMAC 14.9.12.1, 5/15/2000;
A, 3/1/2002; Repealed 1/1/2021]
13.14.9.36 SECOND
MORTGAGES OR SUBSEQUENT ISSUES: The premium for a loan policy insuring any
mortgage granted by the owner of property subsequent to the original date of
his owner’s policy shall be determined by the superintendent in a title rate case. In no event shall the premium collected be
less than the regular minimum promulgated rate for an owner’s policy.
[13.14.9.36 NMAC – Rp, 13.14.9.36 NMAC, 1/1/2021]
13.14.9.37 COMPUTATION
OF RATES WHEN INSURED PROPERTY IS NOT IDENTICAL: When
only a portion of the land previously insured is being insured by a reissue
owner’s policy or by a subsequent issue loan policy, or when the land
previously insured is only a portion of the land being insured by a reissue
owner’s policy or by a subsequent issue loan policy, the rates shall be
adjusted in proportion to the areas insured in the original policy and the
current policy. For example, if the original policy insured one acre and the
current policy insures three acres, the reissue rates will apply to one-third
of the current value up to the face amount of the original policy; but, if the
situation is reversed, the reissue rates will only apply up to one-third of the
face amount of the original policy. In no event shall the reissue rates be
applied to allow more than 100% of the face amount of the original policy to be
used cumulatively in the computation of reissue rates.
[13.14.9.37 NMAC – Rp, 13.14.9.37 NMAC, 1/1/2021]
13.14.9.38 COMPUTATION
OF RATES UPON CONVERSION OF LEASEHOLD OWNER’S POLICY TO STANDARD OWNER’S POLICY: When
a leasehold owner’s policy is converted to a standard owner’s policy and more
insurance is desired or required under the standard owner’s policy than was
written in the leasehold owner’s policy, the difference must be computed at the
basic premium rates in the applicable bracket or brackets in the same manner as
excess liability is computed.
[13.14.9.38 NMAC – Rp, 13.14.9.38 NMAC, 1/1/2021]
13.14.9.39 SUBSTITUTION
RATE ON LOANS TO TAKE UP, RENEW, EXTEND OR SATISFY AN EXISTING INSURED LOAN:
B. The term “same property” in
Section 59A-30-6.1 NMSA 1978 shall mean the identical property or any portion
thereof. The reduction in rate pursuant
to Section 59A-30-6.1 NMSA 1978 shall not apply in any case where any
additional property not covered by the original policy or policies is included
in the policy to be issued.
C. If two or more previous loan
policies insuring different properties are presented to the title insurance agency
or title insurer for a refinance discount pursuant to Section 59A-30-6.1 NMSA
1978, and provided that the new policy will contain the same properties as
shown in said previous policies, the discount will be computed as follows:
title insurance agency or title insurer shall base the discount on the date of
issue of the oldest previous policy and upon a liability amount equal to the
sum of the liability amounts of the previous policies. In no event shall the premium collected be
less than the regular minimum promulgated rate for an owner’s policy.
D. This rule, may be applied in
connection with the issuance of a series of mortgage policies issued by reason
of noted being apportioned to individual units in connection with a master
policy covering the aggregate indebtedness, including improvements. Individual loan
policies must be issued at the original first loan single issue rate.
[13.14.9.39 NMAC –
Rp, 13.14.9.39 NMAC, 1/1/2021]
13.14.9.40 INSURING
CONSTRUCTION LOANS AND
DELETING STANDARD EXCEPTION 4 IN LOAN POLICIES:
A. A loan policy may be issued to
insure a construction loan mortgage if the loan policy contains the following
two-year claims made limitation:
“Notwithstanding any other provision of this policy, the company shall
be liable only for such loss or damage insured against by this policy which is
actually sustained by the insured and reported to the company as provided in
the conditions and stipulations on or before two years after the recording of
the mortgage described in Schedule A. (Upon payment to the company of the
required full loan policy premium prior to the expiration of said policy, the
term limitation may be deleted from this policy).”
B. A construction loan policy or a loan policy
containing the two-year claims made limitations pursuant to Subsection A of this
section may be extended beyond its initial two-year term for additional
premium.
C. The issuance of a construction
loan policy, or a standard loan policy with a two-year claims made limitation,
may not be used as the basis for claiming a credit or discount on a refinanced
property premium pursuant to Section 59A-30-6.1, NMSA 1978; a subsequent issue,
or a substitution issue loan.
[13.14.9.40 NMAC – Rp, 13.14.9.40 NMAC, 1/1/2021]
13.14.9.41 SINGLE
POLICY MULTIPLE COUNTIES: In the event a proposed insured requests that
a single policy be issued insuring multiple New Mexico properties that may be
located in more than one county, the amount of insurance shall be allocated to
each county based upon a supported amount as provided in writing by the
proposed insured. The premium shall be calculated as if a policy was being
issued separately in each county and the aggregated gross premiums shall be
combined to determine the gross premium for the single policy. A New Mexico title
insurance agency or title insurer that maintains a title insurance agency or
direct operation in one of the counties in which the property is located
(“direct operation”) (collectively “issuing company”) must issue the policy and
disburse, or direct the payee to disburse, the gross premium attributable to
each county to the title insurance agency or direct operation in such county
for such policy to be remitted to the title insurer in accordance with the
division of premium rule in affect at the time of issuance. The policy
schedules applicable to the land located in each county shall be countersigned
by the title insurance agency or direct operation and provided to the issuing
company. The issuing company shall provide each title insurance agency or
direct operation with a complete copy of the final policy which shall be
maintained in accordance with underwriter and regulatory requirements. Each title
insurance agency or direct operation shall report the policy utilizing the
combined policy number but only the gross premium it received attributable to
the property within its county shall be reported. Issuance of a single policy shall not be used
when the transaction involves property outside of New Mexico. This rule shall
not be interpreted to allow a title insurer to issue what is commonly referred
to as home office issued policies.
[13.14.9.41 NMAC – Rp, 13.14.9.41 NMAC, 1/1/2021]
[13.14.9.42 NMAC – N,
3/1/2016; A, 7/1/2018; Repealed 1/1/2021]
HISTORY OF 13.14.9 NMAC:
Pre-NMAC History.
ID 74-1, Article 10, Chapter 58, Rule 2, Regulations for Filing Title
Insurance Forms and Rates, filed 3/7/1974.
SCC-85-6, Insurance Department Regulation 30 - Title Insurance, filed 9/6/1985.
SCC-86-1, Insurance Department Regulation 30 - Title Insurance, filed 5/9/1986.
History of Repealed Material.
13.14.9 NMAC- General Rate Provisions, filed 6/16/1986 was repealed and
replaced by 13.14.9 NMAC – General Rate Provisions, effective 1/1/2021.
Other History.
Re-promulgated a portion of SCC-86-1, Insurance Department Regulation
30 - Title Insurance (filed 5/9/1986) and renumbered, reformatted and replaced
as 13 NMAC 14.9, General Rate Provisions, effective 11/01/1996.
13 NMAC 14.9, General Rate Provisions (filed 10/2/1996), was renumbered,
reformatted, amended and replaced by 13.14.9 NMAC, General Rate Provisions, effective
5/15/2000, amended effective 8/15/2014.
13.14.9 NMAC, General Rate Provisions, effective 8/15/2014, amended
effective, 3/1/2016.
13.14.9 NMAC, General Rate Provisions, effective 3/1/2016, amended
effective, 7/1/2018.