(a)  When a title insurance report includes an offer to issue an owner’s policy covering the resale of owner-occupied residential property, the report shall be furnished to the purchaser-mortgagor or its representative as soon as reasonably possible prior to closing. If the report cannot be delivered prior to the day of closing, the title insurer or agent shall document the reasons for the delay. The report furnished to the purchaser-mortgagor shall incorporate the following statement on the first page in bold type:

“Please read the exemptions and the terms shown or referred to herein carefully. The exemptions are meant to provide you with notice of matters which are not covered under the terms of the title insurance policy and should be carefully considered.

It is important to note that this form is not a written representation as to the condition of title and may not list all liens, defects, and encumbrances affecting title to the land.”

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Terms Used In Rhode Island General Laws 27-2.6-12

  • agent: means an authorized person, other than a bona fide employee of the title insurer who, on behalf of the title insurer, performs the following acts, in conjunction with the issuance of a title insurance report or policy:

    (i)  Determines insurability and issues title insurance reports or policies, or both, based upon the performance or review of a search or abstract of title; and

    (ii)  Performs one or more of the following functions:

    (A)  Collects or disburses premiums, escrow or security deposits or other funds;

    (B)  Handles escrows, settlements or closings;

    (C)  Solicits or negotiates title insurance business; or

    (D)  Records closing documents. See Rhode Island General Laws 27-2.6-3

  • insurer: means a company organized under laws of this state for the purpose of transacting the business of title insurance and any foreign or non-United States title insurer licensed in this state to transact the business of title insurance. See Rhode Island General Laws 27-2.6-3
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • policy: means a contract insuring or indemnifying owners of, or other persons lawfully interested in, real or personal property or any interest in real property, against loss or damage arising from any or all of the following conditions existing and not excepted or excluded:

    (i)  Defects in or liens or encumbrances on the insured title;

    (ii)  Unmarketability of the insured title;

    (iii)  Invalidity, lack of priority or unenforceability of liens or encumbrances on the stated property;

    (iv)  Lack of legal right of access to the land; or

    (v)  Unenforceability of rights in title to the land. See Rhode Island General Laws 27-2.6-3

  • real estate: may be construed to include lands, tenements, and hereditaments and rights thereto and interests therein. See Rhode Island General Laws 43-3-10

(b)  A title insurer issuing a lender’s title insurance policy in conjunction with a mortgage loan made simultaneously with the purchase of all or part of the real estate securing the loan, where no owner’s title insurance policy has been requested, shall give written notice to the purchaser-mortgagor at the time the commitment is prepared. The notice shall explain that a lender’s title insurance policy is to be issued protecting the mortgage-lender, and that the policy does not provide title insurance protection to the purchaser-mortgagor as the owner of property being purchased. The notice shall explain what title policy insures against and what possible exposures exist for the purchaser-mortgagor that could be insured against through the purchase of an owner’s policy. The notice shall also explain that the purchaser-mortgagor may obtain an owner’s title insurance policy protecting the property owner at a specified cost or approximate cost, if the proposed coverages or amount of insurance is not then known. A copy of the notice, signed by the purchaser-mortgagor, shall be retained in the relevant underwriting file at least five (5) years after the effective date of the policy.

History of Section.
P.L. 2010, ch. 58, § 1; P.L. 2010, ch. 66, § 1.