STG Utility Facility Endorsement Guideline 1

Explanation:

This endorsement insures against loss if specific utility lines don't: (a) enter the insured premises, and (b) service the insured premises.  It relies upon confirmation of several off-record matters.

Underwriting Requirements:

 1.         The endorsement contains a list of possible utility lines, some of which may not be available to the subject property.  Ascertain from the customer the specific utilities that are of concern.  Use that as the basis for your inquiry.

2.         Each of the requested utility lines must be analyzed separately, as follows:

(A)       Confirm that the specified utility line actually enters the property.  Review the survey and locate and identify the specified utility line.  As a reminder, the existence of a utility easement (recorded, platted and/or shown on the survey) is not evidence that a utility line actually runs through the easement area.  Failure to show a particular utility line on the survey is a potential indicator that the utility service doesn't exist.  For example, a sanitary sewer line may not exist because there may be a septic system instead.  Similarly, storm water drainage may be handled by drainage ponds.  Consult with the surveyor to resolve ambiguities.

(B)       Confirm that the specified utility line actually services the premises.  Although a utility line may exist, it may not service the subject property.  For example, a electrical power line may cross a property, but not actually deliver electricity to the buildings there.  If the survey shows a utility line connecting to a building, you may assume that the line services the premises.  However, if you are unable to make a determination based solely upon the survey, you should obtain independent confirmation that the utility line services the subject premises, for example, by:

i.          Surveyor's written confirmation (on survey or by separate letter);

ii.          Letter from utility company;

iii.         Letter from municipal/county authority;

iv.         Letter from engineer;

v.         Affidavit from current owner (which may be incorporated into the title affidavit) together with independent evidence (e.g., water/sewer bill); or

vi.         Municipal water/sewer search.

(C)       If you can confirm that a utility line services the property, but the survey doesn't disclose it, consider deleting the bracketed text "[all as shown on the Survey,]".

3.         This endorsement can be given for existing improvements or recently-completed construction.  It is less likely - but possible - that the requirements can be met for vacant land, since the utility lines may not exist yet.  In such event, consider offering the endorsement upon completion of the construction and satisfaction of the underwriting requirements for issuing the endorsement.