Disclosure of Coverage Limitation

PURPOSE: This regulation prescribes requirements for customer disclosure for limitations of coverage in some circumstances. (1) Lender’s Title Insurance Limitation. Pursuant to section 381.015.2, RSMo, in those purchase transactions where a lender’s title insurance policy is to be issued simultaneously with the purchase of all or part of the real estate securing the loan and where no owner’s title insurance policy has been requested, a title insurer, title agency, or title agent shall give written notice that the lender’s title insurance policy does not provide title insurance protection to the purchaser-mortgagor, and that the purchaser-mortgagor may obtain an owner’s title insurance policy within sixty (60) days of closing at a specified or approximate cost. The disclosure shall be made using a Notice of Availability of Owner’s Title Insurance form (Form T-2), or any form that substantially comports with the specified form. (2) Closing and Settlement Risk. (A) Title insurers, agencies and agents making disclosure under subsections 5 and 6 of section 381.022, RSMo, may make this disclosure to the unprotected person with a Notice of Closing or Settlement Risk form (Form T-3), or any form that substantially comports with the specified form. (B) The authority of a title insurer under section 381.058.3, RSMo, to issue a closing protection letter extends only to transactions in which it is issuing a title insurance policy and its issuing agent or agency is performing closing or settlement services. AUTHORITY: section 374.045, RSMo 2000 and sections 381.015, 381.022, and 381.042, RSMo Supp. 2007.* Emergency rule filed Jan. 16, 2008, effective Jan. 28, 2008, expired July 14, 2008. Original rule filed Jan. 16, 2008, effective Sept. 30, 2008. *Original authority: 374.045, RSMo 1967, amended 1993, 1995; 381.015, RSMo 2000, amended 2007; 381.022, RSMo 2000, amended 2007; and 381.042, RSMo 2000, amended 2007.