Bulletin: MU2016004

Dear Associates:

The American Land Title Association (ALTA) recently adopted and/or revised the following forms:

ALTA Endorsement 18.2-06 (Multiple Tax Parcel) 08-01-2016

This new endorsement is based upon ALTA Endorsement 18.1-06 (Multiple Tax Parcel). Both ALTA Endorsement 18.1-06 and ALTA Endorsement 18.2-06 can be issued with Owner’s or Loan Policies. Both endorsements insure against loss or damage if the specified parcels described in the endorsement are not assessed for real estate taxes under the listed tax identification numbers or if those tax identification numbers include any additional land.  

The endorsements differ in that ALTA Endorsement 18.1-06 also insures against loss or damage if easements, if any, described in Schedule A can be cut off by non-payment of real estate taxes or assessments imposed on the servient estate. 

In many situations, the additional easement coverage contained in ALTA Endorsement 18.1-06 is not applicable, because there are no easements insured in Schedule A, or because state law does not accord priority to the easements over real estate taxes imposed on the servient estate. New ALTA Endorsement 18.2 (Multiple Tax Parcel) does not contain the coverage provision regarding priority of easements over taxes imposed on the servient estate.

ALTA Endorsement 23.1-06 (Co-Insurance – Multiple Policies) 08-01-2016

This new endorsement is based upon ALTA Endorsement 23-06 (Co-Insurance - Single Policy). The existing ALTA Endorsement 23-06 (Co-Insurance – Single Policy) is designed to be issued where two or more underwriters co-insure a single title policy. ALTA Endorsement 23-06 (Co-Insurance – Single Policy) does not contemplate co-insurance by multiple underwriters of more than one title policy.

New ALTA Endorsement 23.1-06 (Co-Insurance – Multiple Policies) is designed to be issued where two or more underwriters co-insure two or more title policies on different land. ALTA Endorsement 23.1-06 (Co-Insurance – Multiple Policies) is designed to be issued with ALTA Endorsement 12-06 (Aggregation - Loan) or ALTA Endorsement 12.1-06 (Aggregation – State Limits – Loan). 

ALTA Endorsement 23.1-06 (Co-Insurance – Multiple Policies) coordinates its coverage with the ALTA 12-06 or 12.1-06 Aggregation Endorsement, if any, attached to the policy, so that each co-insurer’s liability is aggregated with that of the Issuing Co-Insurer, but only to the extent that the co-insurer issues its own ALTA Aggregation Endorsement, and each co-insurer is liable only for its percentage of liability of the total loss or damage under the Co-Insurance Policy, but in no event greater than its respective Aggregate Amount of Insurance set forth in its ALTA Aggregation Endorsement.

Commitment for Title Insurance Adopted 6-17-06 Revised 08-01-2016

The revised ALTA Commitment for Title Insurance 08-01-2016 updates and consolidates the ALTA Commitment Form (6-17-06) and the ALTA Plain Language Commitment Form (6-17-06).  

The revised ALTA Commitment contains the following notable changes and features:

*  adds a Notice at the top of the Commitment reiterating that the Commitment is an offer to issue a title insurance policy or policies, and is not an abstract or opinion of title, and limits the Company’s potential liability to the proposed insured;

*  clarifies the Company’s right to amend the Commitment at any time and the limitations on the Company’s liability relating to an amendment (Commitment Conditions 4 and 5);

*  improves readability by adding and revising headings and reordering certain Commitment Conditions;

*  adds certain definitions consistent with the ALTA Owner’s Policy 2006 and the ALTA Loan Policy 2006 (Commitment Conditions 1);

*  clarifies that the deletion or modification of any Schedule B, Part II - Exception does not constitute an agreement or obligation to provide coverage for that item (Commitment Conditions 6(d));

*  adds a new section reiterating that an issuing agent is the Company’s agent only for the limited purpose of issuing title insurance commitments and policies. Also states that the issuing agent is not the Company’s agent for the purpose of providing closing or settlement services (Commitment Conditions 7);

*  adds a new section reiterating that, if a proforma policy is provided to a proposed insured, it does not reflect the current status of title and does not constitute a commitment to insure (Commitment Conditions 8);

*  adds an optional section preceding Schedule A to insert Transaction Identification Data (Issuing Agent, Issuing Office, ALTA Universal ID, Loan ID Number, Commitment Number, Issuing Office File Number, Property Address, Revision Number), all for reference only. Liability for this data is also limited by Commitment Condition 5(e);

*  adds a notice to Schedule B, Part II - Exceptions stating that the Commitment does not republish any covenant, condition, restriction, or limitation contained in any document to the extent that the covenant, condition, restriction, or limitation violates state or federal law based on race, color, religion, sex, sexual orientation, gender identity, handicap, familial status, or national origin; and

*  adds an introductory clause to Schedule B, Part II - Exceptions stating that the Policy will not insure against loss or damage resulting from the terms and provisions of any lease or easement identified in Schedule A.

These forms are immediately available for use in Illinois, Iowa, Massachusetts, Mississippi, and Oklahoma. In those states where form and/or rate filings are required, we will distribute subsequent state-specific bulletins as these forms become available. 

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

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