§515. Title insurers; limitation of authority, powers

A.(1) No insurer that transacts any class, type, or kind of insurance other than title insurance shall be eligible for the issuance or renewal of a license to transact the business of title insurance in this state.

(2) No title insurance shall be transacted, underwritten, or issued by any insurer transacting or licensed to transact any other class, type, or kind of business.

B. No title insurer shall engage in the business of guaranteeing payment of the principal or the interest on bonds or mortgages.

C.(1) Notwithstanding Subsection A of this Section, a title insurer may issue closing or settlement protection to a person who is a party to a transaction in which a title insurance policy is contemplated to be issued. The closing or settlement protection shall conform to the terms of coverage and form of instrument as may be required by the department and may indemnify a person solely against loss of settlement funds because of the following acts of a settlement agent, title insurer's named employee, or title insurance producer:

(a) Theft or misappropriation of settlement funds.

(b) Failure to comply with instructions when agreed to by the settlement agent, employee, or title insurance producer.

(2) The premium charged by a title insurer for this coverage shall be submitted to and approved by the commissioner of insurance.

(3) A title insurer shall not provide any other coverage which purports to indemnify against improper acts or omissions of a person with regard to escrow or settlement services.

Acts 1997, No. 1427, §1; Acts 1999, No. 192, §1, eff. June 9, 1999; Acts 2007, No. 459, §4, eff. Jan. 1, 2008; Redesignated from R.S. 22:2092.5 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009; Acts 2009, No. 503, §1.