Bulletin: TX2011001

Dear Associates:

We are reissuing this bulletin in a simplified manner.

The Commissioner's order in the 2008 rate case provides for a 2% credit against the basic premium rate for an Owner's Policy of Title Insurance when a general exception for minerals is made. The Commissioner by letter affirmed that the reduction is based on the premium for an owner policy and not on Loan Policies or any endorsements. Recall that the endorsement is issued when you take a general exception to minerals instead of doing a complete mineral search and taking exception to the matters found. The order is effective January 1, 2011.

Our prior bulletin TX2009005 dealing with language in the commitment, the exception language to be used and the specifics of T-19.2 and T-19.3 are unchanged and remain in effect. Specifically, we believe that if you take exception to a specific document(s) that reserves all of the minerals, no credit is applicable and no T-19.2 or T-19.3 endorsements are allowed. If you do take a general exception and the customer insists upon a T-19.2 or T-19.3 or even a T-19 and a T-19.2 or T-19.3, you may issue them. You may insure "surface only" without searching minerals but taking exception to the contract or deed in the current transaction that reserves minerals if the sale contract specifies that the sale is of the surface only.

The premium for the T-19.2 and T-19.3 approved by the Commissioner in 2009 remains $50.

Our prior Bulletin TX2009007 dealing with coal, lignite, uranium, and similar materials remains in effect. In fact, you must not use P-5.1 when these types of leases are present in order to avoid compulsory issuance of the T-19.2 and T-19.3 endorsements.

For information on state ownership of minerals please see section 12.16.4 of Virtual Underwriter, our Bulletin TX2009005 or the article posted on stewarttexas.com).

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.