Bulletin: NJ000097

Dear Associates:

The Commission of Banking and Insurance has approved the following new endorsements and revisions to the Rate and Forms Manuals, to be effective as of January 25, 2005. New endorsements are as follows:

NJRB 5-83 (ALTA 17.1) Indirect Access and Entry

This is a new endorsement which is used when access to a parcel of land to be insured is by way of an easement across another parcel. The endorsement insures against loss if the easement does not provide both actual vehicular or pedestrian access to a named street, and that the street is not physically open and publicly maintained. It also insures against the lack of use of existing curb cuts to the street from the easement.

This endorsement may only be issued for improved land, unless prior underwriter approval is obtained.

The charge for this endorsement is $50; if simultaneous policies are issued, only one $50 charge may be made.

NJRB 5-84 (ALTA 20) First Loss - Multiple Parcel Transaction

The endorsement provides that the insurer will pay that portion of the amount by which the claim diminishes the value of the land below the open loan balance (not exceeding certain limits in the policy), without requiring maturity or acceleration of the indebtedness or pursuit by the insured of remedies under any bond or other insurance policy.

For the new endorsement, there must be at least two parcels of real property covered by the policy, and may only be issued with a loan policy.

The underwriting charge for this endorsement is ten percent (10%) of the applicable underwriting charge of the underlying policy, with a $500 minimum. This endorsement replaces Form 5-58, Contingent Loss ("First Loss") Endorsement.

NJRB 5-85 ALTA 21 Creditors' Rights

This endorsement provides protection against loss or damage by reason of the avoidance, or a court order providing some other remedy, based on the voidability of any estate, interest or mortgage shown in Schedule A due to a fraudulent transfer or preference under federal bankruptcy, state insolvency or similar creditors' rights laws. It does not provide coverage in situations where the insured knew that the transfer or mortgage was intended to hinder, delay or defraud any creditor or is found by a court not to be a transferee or purchaser in good faith.

The charge for the endorsement is twenty percent (20%) of the applicable underwriting charge with a minimum charge of $500. This endorsement may not be issued without approval of the State Office.

Please also note that NJRB 5-46 and 5-47, which are the existing creditor's rights endorsements for loan and owner policies may now only be used for one to four family residences. Copies of the revised forms are included with this Bulletin.

If you are using a Rate and Form Manual which was issued prior to mid-2004, you should make the following changes to your manual:

• Replace the cover sheet with the new one provided.
  
  
• Replace Index to Endorsements page v with the new one provided and add page vi
  
  
• Replace the appropriate paragraphs of Section 10 with the replacement sheets numbered 32, 35, 44, 45, and 46
  
  
• Replace page x and xi of the Index of Forms in the Forms Manual
  
  
• Replace pages 153 and 154 with the new pages 153 and 154
  
  
• Add page 246, NJRB 5-83
  
  
• Add page 247, NJRB 5-84
  
  
• Add page 248, NJRB 5-85

If you are using a Rate and Form Manual which was issued after mid-2004, you should make the following changes to your manual:

• Replace the cover sheet with the new one provided.
  
  
• Replace Index to Endorsements page and page vi
  
  
• Replace pages 32, 35, 44, 45, and 46
  
  
• Replace page x, xi and xii of the Index of Forms in the Forms Manual
  
  
• Replace Forms 5-46 and 5-47 with the new forms 5-46 and 5-47
  
  
• Add new forms 5-83, 5-84 and NJRB 5-85

Please call the state office if you have any questions.