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Posting for
Thursday, October 29, 1998
by: Bert Rush
brush@firstam.com
NEW ALTA FORMS/EAGLE POLICY/TITLE UNDERWRITING
On October 17, 1998, at the end of the ALTA Annual Convention in New York City, the ALTA Forms and Practices Committee approved several new forms, including the "second generation" EAGLE owner's policy (previously approved by the California Land Title Association last summer).
This new policy was the subject of Home Office Underwriting Bulletin No. 1127 by Richard Flory, dated 9/16/98, which includes a nifty chart comparing the coverages contained in the new form against the standard ALTA owner's and the ALTA "R" (a/k/a "Plain Language") owner's policies. The new policy form may be found in the Underwriting Library (internet or intranet)--look for "Volume II Title Insurance Forms"/look for "CLTA Forms"/look for "EAGLE Policy--CLTA Homeowner's Policy of Title Insurance (6/2/98)."
ALTA will next work on a new loan policy form to include new coverages from the second generation EAGLE owner's policy.
Also on 10/17 ALTA approved modified endorsement forms as follows:
ALTA Endorsement Forms 3 and 3.1 (Zoning)--Both modified to describe coverage in traditional insurance language rather than "loss resulting from the incorrectness of assurances." Also, Form 3.1 is modified to provide coverage for loss resulting from insufficient number of parking spaces.
ALTA Endorsement Forms 9, 9.1 and 9.2--Also modified to describe coverage in traditional insurance language. In addition, new Forms 9.1 and 9.2 provide owner's coverage similar to that formerly provided only to lenders by Form 9.
Form 9.1 is designed for use with unimproved land, and 9.2 is designed for improved land.
The Committee also approved standard exceptions for residential policies to facilitate issuance of policies by electronic data interchange (E.D.I.). Work on additional standardized exceptions for E.D.I. continues. This initiative has been led by Stewart Title.
Finally, the Forms and Practices Committee approved an additional form of Closing Protection Letter designed to comply with regulations governing such letters now in force in several states. The Committee is considering two more forms, described by Committee Chairman Joe Bonita (Chicago Title) as follows:
"The committee is also considering two forms of CPL which will be effective in non-residential transactions when the amount of funds the lender transmits to an agent or approved attorney falls within a specified limit. The Non-residential Limitations letter is a general letter designed to provide the title insurer with the option of limiting the size of the transaction in which it will automatically assume the responsibilities provided by the other terms of the CPL. This form may be adopted either as a replacement for the existing ALTA CPL or as an additional form. The Single Transaction form is designed for specific transactions in which the insurer and the lender to be protected have reached an arrangement on the aggregate amount of funds to be transferred for the transaction."
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