1999 Texas Title Insurance Company Call For Experience For The Calendar Year Ended December 31, 1998 Electronic version of data call forms

Texas Department of Insurance 333 Guadalupe Street P.O. Box 149104 Austin, Texas 78714-9104 512/463-6169 May 12, 1999 COMMISSIONER’S BULLETIN #B-0025-99 TO: All TITLE INSURANCE COMPANIES WRITING TITLE INSURANCE IN THE STATE OF TEXAS RE: 1999 TEXAS TITLE INSURANCE COMPANY CALL FOR EXPERIENCE FOR THE CALENDAR YEAR ENDED DECEMBER 31, 1998 This bulletin announces the 1999 company call for experience. Some reporting requirements have changed from the 1998 call. See Section 2 Summary of Changes below. Revisions are marked with “♦” and underlined. The acknowledgement of receipt form included with this letter should be faxed or postmarked no later than May 26, 1999. As before, the department is enclosing a diskette containing an Excel 5.0 spreadsheet of each report. The call, Excel spreadsheet and instructions are also available on our Web page to download at www.tdi.state.tx.us/company/indexcmp.html#datacalls_ind. I encourage you to use the electronic version. If you do, please submit your data both electronically and in printed copy. Also, please take advantage of the checklist we have included this year to validate your report submission. This will enable you to identify and correct problems prior to submitting the report. 1. Title Company Call for Experience Pursuant to the authority of Article 9.07(b) of the Texas Insurance Code (TIC), the department requires all insurance companies writing title insurance in Texas to submit information relating to title insurance experience. The following reports must reflect your Texas experience for calendar year ended December 31, 1998. Form 1 Texas Title Insurance Income Exhibit Form 2 Texas Title Insurance Expense Exhibit ♦ Form 3 Determination of Net Addition to Unearned Premium Reserve Form 4 Analysis of Income Items Reported as Service Charges and Miscellaneous Income Form 5 Loss Development Exhibit Form 6 Loss Adjustment Expense Development Exhibit Form 7 Designation of Affiliated Agencies Form 8 Designation of Direct Operations Form 9 Premium and Loss By Amount of Liability Report ♦ Form 10 Home Equity Title Claims by ALTA Claim Codes ♦ Form 11 Title Policies with T-42 Endorsement Schedule S-1 Transaction Report Schedule S-2 Reconciliation Report Schedule S-3 Liability Distribution Report Schedule S-4 Endorsement Report Schedule S-5 Special Charges and Credits Report Schedule S-6 Co-Insurance Report ALTA Uniform Financial Reporting Plan Income Statement Summary ALTA Uniform Financial Reporting Plan Balance Sheet Summary Aggregate Form A Affidavit Commissioner’s Bulletin # 1999 Texas Title Insurance Call for Experience, Calendar Year Ended December 31, 1998 Page 2 of 2 Instructions for completing Forms 1, 2, 3, 5, 6, 9, 10 and 11 are included. Forms 4, 7, and 8 are self explanatory. Please refer to your copy of the Texas Title Insurance Statistical Plan for instructions on completing Schedules S-1 through S-6. The experience reported on these Schedules is to be prepared on a “direct basis”. That is, in reporting premiums and losses, data on reinsurance assumed is to be excluded and no deduction is to be made for reinsurance ceded. Companies must utilize only the statistical codes contained in the Texas Title Insurance Statistical Plan. In addition, Income Statement and Balance Sheet Summaries are included. These summaries are to be completed by following the instructions of the American Land Title Association Uniform Financial Reporting Plan. An instruction sheet is also included. 2. Summary of Changes • Addition of Forms 10 and 11 to collect data on policies with home equity endorsements and title insurance claims • Clarification of reporting instructions for underwriters whose affiliated agencies write business for other underwriters – affects Forms 1, 4 and Aggregate Form A • Addition of checklist for validation of report submission • Form 3 – Determination of Statutory Premium Reserve has been revised to reflect changes in Article 9.16, Texas Insurance Code 3. Submission Instructions Please submit your title insurance experience according to the instructions provided. No alterations of the exhibits will be permitted. Should it become necessary to explain any of the items reported, please do so in a separate attachment. Enter the name of the company reporting in the space provided on each form. The original, completed report forms and/or diskette must be submitted to: Mail The Texas Department of Insurance Data Services MC 105-5D ATTN.: Betty Flores P.O. Box 149096 Austin, TX 78714-9096 Courier The Texas Department of Insurance Data Services MC 105-5D ATTN.: Betty Flores 333 Guadalupe Street Austin, TX 78701 Statistical reports must be postmarked by June 28, 1999. Failure to meet this deadline and/or to provide accurate data may result in the imposition of sanctions by the Department. Questions concerning this Call should be directed to Betty Flores at (512) 475-1877 or Michael Davis at (512) 322-5029 Sincerely, Clare Pramuk Data Services Director Mail Code 105-5D Enclosures Texas Department of Insurance 333 Guadalupe Street P.O. Box 149104 Austin, Texas 78714-9104 512/463-6169 ACKNOWLEDGMENT OF RECEIPT FOR THE TEXAS TITLE INSURANCE COMPANY STATISTICAL REPORT FOR THE CALENDAR YEAR ENDED DECEMBER 31, 1998 I, an officer for do hereby acknowledge receipt of the Texas Title Insurance Company Call for Experience and Statistical Report. SIGNATURE DATE NEW POINT OF CONTACT (only required if changed or new appointment required) Name: Telephone: ( ) Address: This acknowledgment must arrive at TDI by May 26, 1999. Mail The Texas Department of Insurance Data Services MC 105-5D ATTN.: Betty Flores P.O. Box 149096 Austin, TX 78714-9096 Courier The Texas Department of Insurance Data Services MC 105-5D ATTN.: Betty Flores 333 Guadalupe Street Austin, TX 78701 Fax Number: (512) 463-6122 1999 TEXAS TITLE INSURANCE COMPANY STATISTICAL REPORT FORM 1 THE TEXAS TITLE INSURANCE INCOME EXHIBIT Calendar Year Ended December 31, 1998 General Instructions: 1. Experience must be reported on an accrual basis. 2. Amounts reported must be in accordance with the "Instructions for Completing Title Insurance Annual Statement Blank" unless such instructions are in conflict with instructions in this call. 3. Allocation of Investment Income, Realized Capital Gains and Unrealized Capital Gains to Texas must be in accordance with the Uniform Financial Reporting Plan of the American Land Title Association. 4. Do not adjust premiums for reinsurance acquired or ceded. 5. "Agency Function" is defined to include closing and examination. 6. Amounts reported for Direct Operations and Affiliated Agents must agree with amounts reported on Aggregate Form A, as follows: FORM 1 AGGREGATE FORM A Line 7 Same As Line A.1 Line 8 Same As Line A.3 Line 9 Same As Line A.2 Line 21 Same As Line A.14 N 7. Report only premiums written for your company on Aggregate Form A, line A.1, A.2 and A.3. Report premiums retained from premiums written for other underwriters as other income on Aggregate Form A and as miscellaneous income on Form 4 and Form 1. See example on page 3 for further explanation. Specific Instructions: N Line 1, Gross premiums - other than home office issue: Report the direct premiums written by direct operations, independent agents and affiliated agents on policies other than home office issue in columns B, C and D, respectively. Do not include premiums on policies written for other underwriters. N Line 2. Premiums allocated to agency function - other than home office issue: Report premiums retained by direct operations, independent agents and affiliated agents on policies other than home office issue in columns B, C and D, respectively. Do not include premiums retained on policies written for other underwriters here. Report these as miscellaneous income on Form 4. N Line 3, Premiums allocated to underwriter function - other than home office issue: Report premiums allocated to underwriter by direct operations, independent agents and affiliated agents on policies other than home office issue in column A. Do not include premiums allocated on Instructions for completing FORM 1 Income Exhibit Texas Title Insurance Company Call For Experience For Calendar Year Ended December 31, 1998 Page 3 of 3 policies written for other underwriters. Line 4, Gross premiums - home office issue: Report 100% of the direct premiums from home office issue transactions. Report premiums on policies issued by underwriters, direct operations and affiliated agents in columns A, B and D, respectively. Line 5, Premiums allocated to agency function - home office issue: Report the portion of the direct premium from home office issue transactions allocated to direct operations, independent agents, or affiliated agents for performing the agency function in columns B, C and D, respectively. Amounts paid to attorneys or other non title entities are excluded from this line but should be reported on Form 2, line 3 or 4. Line 6, Premiums allocated to underwriter function - home office issue: Report premiums allocated to underwriter function by underwriters, direct operations and affiliated agents on home office issue policies in column A. Line 7, Gross premiums - Total: Add line 1 and line 4. Total must agree with written premiums reported on Schedule T of the Annual Statement. Line 8, Total premiums allocated to agency function: Add line 2 and line 5. Line 9, Total premiums allocated to underwriter function: Add line 3 and line 6. Line 10, Investment income - tax exempt - before expenses; Line 11, Investment income - dividends - before expenses; Line 12, Investment income - other - before expenses; Line 13, Net realized capital gains (losses); and Line 14, Net unrealized capital gains (losses); Amounts must agree with amounts reported on the ALTA Uniform Financial Reporting Plan. Line 15, Total investment income: Sum of lines 10-14. Line 16, Reinsurance fees (acquired): Allocate all reinsurance fees (acquired) to Escrow, Abstract and Other Business. Line 17, Service charges: For Underwriters (Column A), amounts must equal Form 4 totals. For Direct Operations (Column B) and Affiliated Agents (Column D), amounts must equal Lines A4 through A9 on the Aggregate Form A. Line 18, Escrow & abstract fees: Allocate all escrow and abstract fees to Escrow, Abstract and Other Business. NLine 19, Miscellaneous income: Amounts must agree with Form 4 totals. Include the premium retained for other underwriters. Line 20, Total other income: Sum of lines 16-19. Line 21, Total income: Sum of Title Insurance Premiums, Investment Income and Other Income shown on lines 8, 9, 15 and 20. Instructions for completing FORM 1 Income Exhibit Texas Title Insurance Company Call For Experience For Calendar Year Ended December 31, 1998 Page 3 of 3 Line 22, Number of Title Policies Issued in Texas: Owners policies are issued under Rate Rules R3 and R5. Basic Rate Mortgagee policies are issued under Rate Rule R4. Simultaneous issue Rate Mortgagee policies are issued under Rate Rule R5. Example for reporting premium when affiliated agency writes business for more than affiliated underwriter: 123 Title Agency is an affiliate of underwriter ABC for whom they wrote $100,000 in business. They also wrote $10,000 in business for underwriter XYZ. Agent 123 reported $110,000 in premium on their Agent Statistical Report. For ABC’s Title Company Report, they will report the entire $100,000 premium but only the retained premium written for underwriter XYZ. The $10,000 premium will be reported on underwriter XYZ’s statistical report as premium written by independent agents. The following diagrams show how the premiums should be reported. 123 Title Agent Statistical Report Form B Distribution of Title Policy Premiums Name of Underwriting Company for which Agency Charged Premiums Title Premiums Charged Title Premiums Remitted Title Premiums Retained ABC Title Underwriters 100,000 17,750 82,250 XYZ Title Underwriters 10,000 1,775 8,225 Total 110,000 19,525 90,475 ABC Underwriter Statistical Report Aggregate Form A Income Title Insurance Premiums 100,000 Remitted Title Premiums 17,750 Retained Title Premiums 82,250 . . . . Other Income 8,225 ABC Underwriter Statistical Report Form 4 Miscellaneous Income Underwriter Direct Operations Affiliated Agents Investment Escrow, Abstract & Other Premium retained from other UW 8,225 ABC Underwriter Statistical Report Form 1 Other Income Underwriter Direct Operations Affiliated Agents Investment Escrow, Abstract & Other Line 19 Miscellaneous 8,225 FORM 1 TITLE INSURANCE INCOME EXHIBIT Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: ______________________________________________ Capital Stock $________________ Surplus $________________ Investment in Abstract Plant (Book Value) $________________ Dividend Rate ________________% (A) (B) (C) (D) (E) (F) (G) Types of Income Title Insurance Escrow, Gross Amount Abstract Per Books Direct Independent Affiliated & Other (Sum of Underwriters Operations Agents Agents Investment Business Columns A-F) PREMIUM INCOME 1 Gross premiums - other than home office issue 2 Premiums allocated to agency function other than home office issue 3 Premiums allocated to underwriter function other than home office issue (line 1G - line 2G) 4 Gross premiums - home office issue 5 Premiums allocated to agency function home office issue 6 Premiums allocated to underwriter function home office issue (line 4G - line 5G) 7 Gross premiums - Total (line 1 + line 4) 8 Total premiums allocated to agency function (line 2 + line 5) 9 Total premiums allocated to underwriter function (line 3 + line 6) INVESTMENT INCOME 10 Investment income - tax exempt - before expenses 11 Investment income - dividends - before expenses 12 Investment income - other - before expenses 13 Net realized capital gains (losses) 14 Net unrealized capital gains (losses) 15 Total (Sum of lines 10 through 14) OTHER INCOME 16 Reinsurance fees (acquired) 17 Service charges (from Form 4) 18 Escrow & abstract fees 19 Miscellaneous (from Form 4) 20 Total (Sum of lines 16 through 19) 21 TOTAL INCOME (Sum of lines 8, 9, 15, & 20) NUMBER OF TITLE POLICIES ISSUED 22 Owner Policies (Rate Rules R3 and R5) Mortgagee Policies At Basic Rates (Rate Rule R4) Mortgagee Policies At Simultaneous Issue Rates (Rate Rule R5) All Other Forms For Which A Premium Was Charged Total FORM 2 THE TEXAS TITLE INSURANCE EXPENSE EXHIBIT Calendar Year Ended December 31, 1998 General Instructions: 1. Experience must be reported on an accrual basis. 2. Allocation of expenses to specific expense categories must be in accordance with the "Instructions for Completing Title Insurance Annual Statement Blank" unless such instructions are in conflict with instructions in this call. 3. Allocation of expenses to Texas (amounts in Column F, Gross Amount Per Books) must be in accordance with the Uniform Financial Reporting Plan of the American Land Title Association unless such instructions are in conflict with instructions in this call. 4. Amounts reported for Direct Operations and Affiliated Agents must agree with amounts reported on Aggregate Form A. 5. Allocate expenses on a direct basis where applicable. Otherwise, allocate to each operation on the basis of total income. Specific Instructions: Line 1c, Salaries: Salaries, end of year bonuses, commissions and any other forms of direct cash compensation of officers and employees only. Exclude salaries or wages, etc., of janitors, caretakers, maintenance personnel and agents paid in connection with owned real estate and premises leased for company use, retirement allowances, directors and committee fees and disability payments to or on behalf of employees under self-insurance plans. Line 2, Employee benefits, relations & welfare: Group insurance (which includes life, dental and health, etc.), profit sharing and pension plans (including 401 (k), ESOP, SEP, etc.), retirement insurance (annuities), unemployment and payroll taxes, employee training costs, service awards and company parties or other functions held solely for and attended solely by bona fide company directors, officers, and employees and their families. Lines 3a & 3b, Fees paid for title examination & furnishing title evidence: Amounts paid for the examination, searching, reading or rendering of title opinions to: 3a Title Agents 3b Outside Attorneys and Others Lines 4a & 4b, Closing costs paid non-employees: Amounts paid for closing a transaction where you will be issuing the policy to: 4a Title Agents 4b Fee Basis Attorneys and Others Line 8, Advertising and Promotions: Includes all advertising expenses, entertainment and meal expenses for the purpose of promoting the title agency. Promotional activities include furnishing or making expenditures for advertising mementos (i.e. logo inscribed memorabilia) which promote the licensee. Entertainment expense includes furnishing or making reasonable Instructions for completing FORM 2 Expense Exhibit Texas Title Insurance Company Call For Experience For Calendar Year Ended December 31, 1998 Page 2 of 3 expenditures, not conditioned on the referral of title insurance business for entertainment, food and beverage by a title agent for a person in a position to refer title insurance business. Also include expenditures for educational activities designed to provide instruction about the business of title insurance to people in positions to refer title business. Line 9, Employee travel, lodging & education: Report expenses for business travel, including meals and short-term vehicle rentals while in travel status. Includes employee training expenses. Does NOT include long-term vehicle leases which should be reported on line 19. Line 12, Legal expense: Includes legal fees and retainers for corporate and administrative matters. Does NOT include costs for defending a loss. These should be reported on line 24. Line 13, Licenses, taxes & fees: Includes, but is not limited to: State and local insurance taxes (i.e., premium taxes), business, corporate and agent license fees and insurance department examination fees. Exclude real estate and federal taxes. Line 14, Postage & freight: Includes postage and freight expenses usual and customary to the operation of any business. Line 15, Courier & overnight delivery: Includes courier and overnight delivery charges paid to third-party vendors for the benefit of title insurance customers. Does NOT include expenses paid to an employee assigned runner/courier duties, which should be reported on line 1a. Line 16, Telephone & facsimile: Includes monthly telephone service charges as well as dedicated line charges, long distance charges, and other operational charged for facsimile equipment. Line 19, Equipment & vehicle leases: Includes all payments for vehicles and other equipment (whether mobile or stationary) acquired through long-term lease agreements. Does NOT include any short-term vehicle rentals while in travel status. These are reported on line 9. Line 21, Directors fees: Includes all amounts paid to corporate directors. Does NOT include any amounts reported under salaries on line 1b. Line 22, Dues, boards & associations: Includes only those amounts paid for memberships in associations and on boards. Does NOT include any portion of dues used to support political action committees or lobbyists. Those expenses should be reported on line 38. Does not include amounts paid to trade associations or clubs. Trade association expenses should be reported on line 39 and club memberships as employee benefits on line 2, or advertising and promotions on line 8. Line 23, Bad debts: Limited to obligations due to this company which were written off books during the calendar year as uncollectible. Line 24, Loss adjustment expenses incurred: Legal costs, court costs, investigative costs or any other costs incurred in the defense or appeal of suits in connection with a title claim. Reported amount should include amounts paid and case basis reserves only. Do not include I.B.N.R. or bulk reserves. Do not include any LAE reported on line B-24 of the Affiliated Agent or Direct Operation Aggregate Form A. Line 25, Losses incurred: Losses incurred on a title claim covered by a policy or binder. Report paid and case basis reserves only. Do not include I.B.N.R. or bulk reserves. Do not include any LOSSES reported on line B-24 of the Affiliated Agent or Direct Operation Aggregate Form A. Instructions for completing FORM 2 Expense Exhibit Texas Title Insurance Company Call For Experience For Calendar Year Ended December 31, 1998 Page 3 of 3 Line 26, Reinsurance charges (ceded): All payments made to other underwriters for the transfer of risk under the applicable reinsurance agreements or contracts. Allocate all costs to Escrow, Abstract & Other Business. Line 27, Other: Appropriate expense not included in any other expense category in this report. Line 32, Net addition to unearned premium reserve: See Article 9.16, Texas Insurance Code. Line 33, Abstract costs: Amounts paid to non-employees for miscellaneous searches, reports, certificates, abstracts, surveys, and maps pertaining to record proof required in the examination of title. Line 34, Real estate expenses: Salaries, wages and other compensation, including payroll taxes of janitors, caretakers, maintenance men, agents paid in conjunction with owned real estate. Also includes insurance, advertising, maintenance and operation costs in conjunction with owned real estate. Line 36, Damages paid for bad faith suits: Include any amount paid by the insurer for damages in a bad faith suit against the insurer in Texas. Line 37, Fines or penalties for violation of law: Enter all amounts paid to any Texas governmental entity for violation of law. Line 38, Donations/lobbying: “Donations” means charitable contributions. “Lobbying expenses” includes amounts paid to political action committees (whether directly or indirectly through other organizations) and individual lobbyists (whether directly or indirectly through other organizations). Does not include amounts paid to trade associations. Those expenses should be reported on line 39. Line 39, Trade association fees: Report amounts paid to organizations providing professional services as well as lobbying. Line 40, Total expenses: Sum of lines 1 - 39. Line 41, Profit or (loss) before federal income tax: Total income (Form 1, line 21) minus Total expenses (Form 2, line 40). FORM 2 TITLE INSURANCE EXPENSE EXHIBIT Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: ______________________________________ (A) (B) (C) (D) (E) (F) Title Insurance Escrow, Expenses Abstract Gross Amount Direct Affiliated & Other Per Books Underwriters Operations Agents Investment Business (Sum of Columns A - E) 1a Salaries - employees 1b Salaries - owners & partners 1c Salaries - Total 2 Employee benefits, relations & welfare 3a Fees paid for title examination & furnishing title evidence - Title Agents 3b Fees paid for title examination & furnishing title evidence - Others 4a Closing costs paid non-employees - Title Agents 4b Closing costs paid non-employees - Others 5 Rent 6 Utilities 7 Accounting & auditing 8 Advertising & promotions 9 Employee travel, lodging and education 10 Insurance 11 Interest expense 12 Legal expense 13 Licenses, taxes & fees 14 Postage & freight 15 Courier & overnight delivery 16 Telephone & facsimile 17 Printing & photocopying 18 Office supplies 19 Equipment & vehicle leases 20 Depreciation FORM 2 (Continued) TITLE INSURANCE EXPENSE EXHIBIT Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: __________________________________ (A) (B) (C) (D) (E) (F) Title Insurance Escrow Expenses Abstract Gross Amount Direct Affiliated & Other Per Books Underwriters Operations Agents Investment Business (Sum of Columns A - E) 21 Directors fees 22 Dues, boards & associations 23 Bad debts 24 Loss adjustment expenses incurred 25 Losses incurred 26 Reinsurance charges (ceded) 27 Other 28 Tax certificates 29 Recording fees 30 Plant lease/update costs 31 Allowances to managers & agents 32 Net addition to unearned premium reserve 33 Abstract costs 34 Real estate expenses 35 Real estate taxes 36 Damages paid for bad faith suits 37 Fines or penalties for violation of law 38 Donations/lobbying 39 Trade association fees 40 Total Expenses (Sum of lines 1 through 39) 41 Profit or (Loss) before federal income tax (Form 1, line 21) minus (Form 2, line 40) FORM 3 DETERMINATION OF STATUTORY PREMIUM RESERVE Calendar Year Ended December 31, 1998 (Article 9.16, Texas Insurance Code, 1967, as amended) I. Determination of Statutory Premium Reserve Required Calendar Year 1998 LINES 1 THROUGH 4 are to be reported as set forth in the title insurer’s annual statement (See Article 9.16, Section 3(a)) for domestic insurers. Foreign insurers should utilize the same formulas for comparison purposes. Line 1- Net Retained Liability (in millions) Line 2 - Direct Premium Written for Calendar Year 1998 (Countrywide) Line 3 - If Line 2 is >= $250,000, then enter .25, if < $250,000 enter .30 Line 4 - Statutory Premium Reserve II. Determination of Statutory Premium Reserve Reduction for Calendar Year 1998 and Transitional Release, Transitional Charge (Article 9.16, Sec. 4), Calendar Years 1978-1997 Column A - Reserves (1978-1997) - Taken from Form 3, Column B from 1998 call. Copy the 1997 Reserve amount from Form 3, Line 8 of the 1998 call. Column B - Statutory % Release (1978-1997) - These figures are set in Article 9.16, Sec. 2(c). Column C - Reduction (1978-1997) - This is calculated by multiplying the Reserves (Col A) by the Statutory Percentage Release (Col B). Line 25 is the Total SPR Reduction for Calendar Year 1998. Line 26 - Statutory Premium Reserve Balance as of 12/31/1997 - Copy this number from Title Insurance Company Statistical Report for 1998 experience, Form 3, Line 34. Line 27 - One-tenth of Transitional Charge (Release) as calculated for years ’97 and prior – Copy this number from Title Insurance Company Statistical Report for 1998 experience, Form 3, Line 32. Line 28 - Supplemental Reserve, if applicable - See Texas Insurance Code, Article 9.16, Section 7 to determine if applicable. An amount should be shown here if Part 3B, Line 11 on your Annual Statement has a balance. Line 29 - Statutory Premium Reserve Balance as of 12/31/98 - Add the Total (Line 25), Statutory Premium Reserve Balance as of 12/31/97 (Line 26), One-tenth of Transitional Charge (Release) as calculated for years ’97 (Line 27) and Supplemental Reserve, if applicable (Line 28). Subtract this subtotal from Statutory Premium Reserve (Line 4). FORM 3 DETERMINATION OF STATUTORY PREMIUM RESERVE Calendar Year Ended December 31, 1998 Texas Experience Only ($000 omitted) (Article 9.16, Texas Insurance Code, 1967, as amended) Name of Company: ____________________________________________ Determination of Statutory Premium Reserve Required Calendar Year 1998 1. Net Retained Liability (in millions) 2. Direct Premium Written for Calendar Year 1998 (Countrywide) 3. If Line 2 is >= $250,000 enter .25, if < $250,000 enter .30 here. 4. Statutory Premium Reserve (Line 1 x Line 3) Determination of Statutory Premium Reserve Balance A B C Reserves (Statutory) (A x B) Year (Col B from '98 call) % Release Reduction 5. 1978 1% 6. 1979 1% 7. 1980 1% 8. 1981 1% 9. 1982 1% 10. 1983 1% 11. 1984 2% 12. 1985 2% 13. 1986 2% 14. 1987 2% 15. 1988 2% 16. 1989 3% 17. 1990 3% 18. 1991 3% 19. 1992 5% 20. 1993 5% 21. 1994 9% 22. 1995 10% 23. 1996 20% 24. 1997 26% Note: Column A = Line 8, from '98 call 25. Total 26. Statutory Premium Reserve Balance as of 12/31/97 (Line 34 from '98 call) 27. One-tenth of Transitional Charge (Release) as calculated for years '97 and prior (Line 32 of '98 call) 28. Supplemental Reserve, if applicable TIC, Art. 9.16 Sec. 7 29. Statutory Premium Reserve Balance as of 12/31/98 (Line 4-Line 25 Col C+Line26+Line 27+Line 28) FORM 4 ANALYSIS OF INCOME ITEMS REPORTED AS SERVICE CHARGES AND MISCELLANEOUS INCOME Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: ________________________________________________ Title Insurance Escrow, Underwriter Direct Operations Affiliated Agents Investment Abstract & Other Business Service Charges (a)* (b)* (c)* (d)* (e)* (f)* (g)* TOTAL (Carry total forward to Form 1, line 17A) (Carry total forward to Form 1, line 17B) (Carry total forward to Form 1, line 17D) (Carry total forward to Form 1, line 17E) (Carry total forward to Form 1, line 17F) Miscellaneous Income N (a)* Retained from other underwriters (b)* (c)* (d)* (e)* (f)* (g)* TOTAL (Carry total forward to Form 1, line 19A) (Carry total forward to Form 1, line 19B) (Carry total forward to Form 1, line 19D) (Carry total forward to Form 1, line 19E) (Carry total forward to Form 1, line 19F) * Define in detail the source of and/or services performed for these income items Use additional sheets as necessary FORM 5 THE TEXAS TITLE INSURANCE LOSS DEVELOPMENT EXHIBIT Calendar Year Ended December 31, 1998 General Instructions: 1. The purpose of this exhibit is to provide data for evaluation of the development characteristics of Texas Title Insurance policy losses. 2. Do not include amounts paid or reserved on policies with inception dates prior to January 1, 1989. 3. Reported losses must be net of recoupment. 4. Do not include loss adjustment expenses. Specific Instructions, Using Policy Inception Year 1989 as an Example: 1. Losses paid in 1989 on policies with 1989 inception dates are reported on line 1, in column A. Case basis loss reserves on December 31, 1989 on policies with 1989 inception dates are reported on line 2, in column A. 2. Cumulative losses paid in 1989 and 1990 on policies with 1989 inception dates are reported on line 1, in column B. Case basis loss reserves on December 31, 1990 on policies with 1989 inception dates are reported on line 2, in column B. 3. Cumulative losses paid in 1989 - 1998 on policies with 1989 inception dates are reported on line 1, in column J. Case basis loss reserves on December 31, 1998 on policies with 1989 inception dates are reported on line 2, column J. 4. Use the same procedure for reporting paid losses and case basis loss reserves on policies with inception dates in 1989 on lines 4 and 5, in columns B - J; for policies with inception dates in 1990, on lines 7 and 8, in columns C - J, etc. FORM 5 TITLE INSURANCE LOSS DEVELOPMENT EXHIBIT Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: _______________________________________ (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) Description Policy Inception Year 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1 Paid losses 2 Case basis reserves 3 Incurred (1 + 2) 4 Paid losses 5 Case basis reserves 6 Incurred (4 + 5) 7 Paid losses 8 Case basis reserves 9 Incurred (7 + 8) 10 Paid losses 11 Case basis reserves 12 Incurred (10 + 11) 13 Paid losses 14 Case basis reserves 15 Incurred (13 + 14) 16 Paid losses 17 Case basis reserves 18 Incurred (16 + 17) 19 Paid losses 20 Case basis reserves 21 Incurred (19 + 20) 22 Paid losses 23 Case basis reserves 24 Incurred (22 + 23) 25 Paid losses 26 Case basis reserves 27 Incurred (25 + 26) 28 Paid losses 29 Case basis reserves 30 Incurred (28 + 29) FORM 6 TITLE INSURANCE LOSS ADJUSTMENT EXPENSE DEVELOPMENT EXHIBIT Calendar Year Ended December 31, 1998 General Instructions: 1. The purpose of this exhibit is to provide data for evaluation of the development characteristics of Texas Title Insurance loss adjustment expenses. 2. Do not include amounts paid or reserved on policies with inception dates prior to January 1, 1989. 3. Reported loss adjustment expenses must be net of recoupment. Specific Instructions, Using Policy Inception Year 1989 as an Example: 1. L.A.E. paid in 1989 on policies with 1989 inception dates are reported on line 1, in column A. Case basis L.A.E. reserves on December 31, 1989 on policies with 1988 inception dates are reported on line 2, in column A. 2. Cumulative L.A.E. paid in 1989 and 1990 on policies with 1989 inception dates are reported on line 1, in column B. Case basis L.A.E. reserves on December 31, 1990 on policies with 1989 inception dates are reported on line 2, in column B. 3. Cumulative L.A.E. paid in 1989 - 1998 on policies with 1989 inception dates are reported on line 1, in column J. Case basis L.A.E. reserves on December 31, 1998 on policies with 1989 inception dates are reported on line 2, column J. 4. Use the same procedure for reporting paid L.A.E. and case basis L.A.E. reserves on policies with inception dates in 1989 on lines 4 and 5, in columns B - J; for policies with inception dates in 1990, on lines 7 and 8, in columns C - J, etc. FORM 6 TITLE INSURANCE LOSS ADJUSTMENT EXPENSE DEVELOPMENT EXHIBIT Calendar Year Ended December 31, 1998 Texas Experience Only Name of Company: ____________________________________________ (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) Description Policy Inception Year 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1 Paid L.A.E. 2 Case basis reserves 3 Incurred (1 + 2) 4 Paid L.A.E. 5 Case basis reserves 6 Incurred (4 + 5) 7 Paid L.A.E. 8 Case basis reserves 9 Incurred (7 + 8) 10 Paid L.A.E. 11 Case basis reserves 12 Incurred (10 + 11) 13 Paid L.A.E. 14 Case basis reserves 15 Incurred (13 + 14) 16 Paid L.A.E. 17 Case basis reserves 18 Incurred (16 + 17) 19 Paid L.A.E. 20 Case basis reserves 21 Incurred (19 + 20) 22 Paid L.A.E. 23 Case basis reserves 24 Incurred (22 + 23) 25 Paid L.A.E. 26 Case basis reserves 27 Incurred (25 + 26) 28 Paid L.A.E. 29 Case basis reserves 30 Incurred (28 + 29) FORM 7 TITLE INSURANCE DESIGNATION OF AFFILIATED AGENCIES As of December 31, 1998 Name of Company: ______________________________________________________ Each of the following Title Insurance Agencies are owned 10% or more by this underwriting company or are a member of a holding company structure that includes this underwriting company. See Texas Insurance Code, Article 21.49-1, Section 2. List exact name shown on Title Insurance Agent’s License, Agent ID number, and address for each agent. Name Agent ID # Address 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. N Attach to this form a copy of the 1998 Form A of each of the above listed Affiliated Agencies. In addition, attach an Aggregate Form A containing the combined 1998 experience of all the above listed Affiliated Agencies. Include only premiums for the underwriting company submitting this report. Report premiums retained from premiums written for other underwriters as other income on Aggregate Form A and miscellaneous income on Form 4 and Form 1. AGGREGATE FORM A TEXAS TITLE INSURANCE UNDERWRITER REPORT FOR THE CALENDAR YEAR ENDED DECEMBER 31, 1998 Name of Company: _____________________________________________________________ Check One: ____ AFFILIATED: Title insurance agencies that are owned 10% or more by this underwriting company or are a member of a holding company structure that includes this underwriting company. See Texas Insurance Code, Article 21.49-1, Section 2. ____ DIRECT OPERATION: Defined in the Texas Insurance Code, Article 9.36A, as a title insurance company owning or leasing and operating an abstract plant or participating in a bona fide joint abstract plant operation in any county in this state and must be licensed by the Board for that county. EXPERIENCE FOR TEXAS TITLE INSURANCE, ESCROW & NON-POLICY ABSTRACT BUSINESS A Income Title Insurance (whole dollars only) Escrow (whole dollars only) Non-Policy Abstract (whole dollars only) 1. Title insurance premiums 2. <less> Remitted title premiums < > 3. Retained title premiums 4. Fees received for title examination and furnishing title evidence 5. Fees received for closing 6. Tax certificates 7. Recording fees 8. Restrictions 9. Inspection fees 10. Courier & overnight delivery 11. Telephone & facsimile 12. Interest income 13. Other income 14. Total for each column (sum of lines 3-13) 15. Total income (sum of all columns in line A-14) N NOTE: Show only title premiums written, remitted and retained for the underwriting company submitting this report on line A.1, A.2 and A.3. Report premiums retained from premiums written for other underwriters as other income on line A.13. Aggregate Form A Page 2 of 3 B Expenses Title Insurance (whole dollars only) Escrow (whole dollars only) Non-Policy Abstract (whole dollars only) 1. Salaries/Wages: a. Employees b. Owners & partners 2. Employee benefits & welfare a. Employees b. Owners & partners 3. Fees paid for title examination and furnishing title evidence a. Other agents & underwriters b. Attorneys/Others 4. Fees paid for closing a. Other agents & underwriters b. Attorneys/Others 5. Rent 6. Utilities 7. Accounting & auditing 8. Advertising and Promotions 9. Employee travel, lodging, & education 10. Insurance 11. Interest expense 12. Legal expense 13. Licenses, taxes & fees 14. Postage & freight 15. Courier & overnight delivery 16. Telephone & facsimile 17. Printing & photocopying 18. Office supplies 19. Equipment & vehicle leases 20. Depreciation 21. Directors fees 22. Dues, board & associations 23. Bad debts 24. Loss & loss adjustment expenses 25. Tax certificates paid tax authorities 26. Recording fees paid county clerk 27. Plant lease/updates 28. Damages for bad faith suits 29. Fines or penalties 30. Donations/lobbying 31 Trade association fees 32. Other expenses 33. Total for each column (sum of lines 1-32) 34. Total expenses (sum of all columns in line 33) Aggregate Form A Page 3 of 3 C 1. Income (or loss) from operations (A-14 less B-33) Title Escrow Non-Policy Abstract 2. Net income (or loss) (sum of all columns in line C-1) D TITLE INSURANCE POLICIES FOR WHICH PREMIUMS WERE COLLECTED BY YOUR AGENCIES 1. Number of owner policies (R3 and R5) 2. Number of mortgagee policies at other than simultaneous issuance rates (other than R5) 3. Number of mortgagee policies at simultaneous issuance rates (R5) 4. Number of all other forms for which a premium was charged 5. TOTAL (sum of D1 through D4) 6. Number of commitments issued for which no policy was issued E UNDERWRITER EXPENSE ALLOCATIONS 1. Total expenses allocated to underwriter 2. Total expenses allocated from underwriter FORM 8 TITLE INSURANCE DESIGNATION OF DIRECT OPERATIONS As of December 31, 1998 Name of Company: ______________________________________________________ A direct operation is defined in the Texas Insurance Code, Article 9.36A., as a title insurance company owning or leasing and operating an abstract plant or participating in a bona fide joint abstract plant operation in any county in this state and must be licensed by the Board for that county. List exact name, Agent ID number, and address for each direct operation. Name Agent ID # Address 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Attach to this form a copy of the 1998 Form A of each of the above listed Direct Operations. In addition, attach an Aggregate Form A containing the combined 1998 experience of all the above listed Direct Operations. FORM 9 PREMIUM AND LOSS BY AMOUNT OF LIABILITY REPORT Calendar Year Ended December 31, 1998 The Premium and Loss by Amount of Liability Report, presents the distribution of incurred loss and allocated loss adjustment expense by policy liability range, number of policies, gross premium and total liability. This schedule expands on the current year information provided in Form 2, lines 24 and 25. Report premium, liability, loss and ALAE on all policies and endorsements that apply to a single transaction. Report all premium, liability, loss and ALAE direct as to reinsurance. Column (2), Gross Premium: The amount of gross premium includes all premium collected for all policies, endorsements, and amendments in each transaction for the calendar year being reported. Column (3), Total Liability: The amount of liability applies to a single title insurance transaction. The amount of liability is non-cumulative on a simultaneous issue of an owner and mortgagee policy. Report the larger liability of the owner or mortgagee policy. Column (3) Total = Form 1, Column G, Gross Premiums, Total Column (4), Incurred Loss and Allocated Loss Adjustment Expense: Losses incurred on a title claim covered by a policy or binder. Legal costs, court costs, investigative costs or any other costs incurred in the defense or appeal of suits in connection with a title claim. The reported amount should include amounts paid and case basis reserves only. Do not include I.B.N.R. or bulk reserves. Do not include any Losses reported on line B-24 of the Affiliated Agent or Direct Operation Aggregate Form A. Column (4) Total = Form 2, Column F, lines 24 & 25 FORM 9 PREMIUM AND LOSS BY AMOUNT OF LIABILITY REPORT Calendar Year Ended December 31, 1998 Name of Company: ___________________________________________________ Liability Range ($000) Number of Policies Gross Premium Total Liability ($000) Incurred Loss and Allocated Loss Adjustment Expense More Than But Less Than 0 0 4.5 4.5 10 10 20 20 30 30 40 40 50 50 60 60 70 70 80 80 90 90 100 100 200 200 300 300 400 400 500 500 1,000 1,000 2,000 2,000 3,000 3,000 4,000 4,000 5,000 5,000 15,000 15,000 25,000 25,000 50,000 50,000 75,000 75,000 100,000 Over 100,000 All N FORMS 10 and 11 REGARDING POLICIES WITH HOME EQUITY ENDORSEMENTS Calendar Year Ended December 31, 1998 In order to collect information for pricing all equity lending transactions, the Department is collecting claims data for Title Insurance policies as well as premium data for policies which include the Equity Loan Mortgage Endorsement (T-42) and Supplemental Coverage Equity Loan Mortgage Endorsement (T-42.1). Provide the information on the attached two worksheets. The TITLE INSURANCE CLAIMS BY ALTA CLAIM CODES worksheet (Form 10) requests claims and loss data by ALTA claim codes. This is not limited to claims due to home equity related risks. The TITLE POLICIES WITH T-42 ENDORSEMENT worksheet (Form 11) is self-explanatory. Its purpose is to show the total premium collected on policies with one or both home equity endorsements. While premiums charged for individual transactions will be reported on Schedules 1 and 3, report all premiums associated with a policy that includes a home equity endorsement on this form. N FORM 10 TITLE INSURANCE CLAIMS BY ALTA CLAIM CODES Calendar Year Ended December 31, 1998 Name of Company: ____________________________________________ ALTA Number of Number of Number of Incurred Recoveries Risk Code Claims Made Claims Paid Claims Denied Losses ALAE from Agents TOTAL Use additional sheets as necessary. N FORM 11 TITLE POLICIES WITH T-42 ENDORSEMENT Calendar Year Ended December 31, 1998 Name of Company: ______________________________________________________ Number of Policies w/T-42 Number of Policies w/T-42.1 Total Premium on above policies including endorsements SCHEDULE S-1 TEXAS TITLE INSURANCE STATISTICAL PLAN Company ___________________________________________________ Experience Period January 1, 1998 - December 31, 1998 TRANSACTION REPORT Gross Rate Excluding Special Agents Transaction Non-Basic Charges/Credits Special Charges Commissions/ Type Number of Total Liability Rate Liability and Endorsements and Credits Endorsements Total Gross Retentions [4] Transactions [5] [6] [7] [9] [11] Revenue [16] NOTE: Special charges must be treated as positive numbers, while special credits must be treated as negative numbers, so that the table entries in this column represent special charges net of special credits and the sum of the revenue component columns equals gross revenue received. SCHEDULE S-2 TEXAS TITLE INSURANCE STATISTICAL PLAN Company Experience Period January 1, 1998 - December 31, 1998 RECONCILIATION REPORT 1. Gross Revenue per Statistical Plan ([7] + [9] + [11]) 2. Adjustments (itemize) 3. Gross Revenue per Texas Title Insurance Income Exhibit (sum of line 7 column G and line 20, columns A, B and D) SCHEDULE S-3 TEXAS TITLE INSURANCE STATISTICAL PLAN Company Experience Period January 1, 1998 – December 31, 1998 LIABILITY DISTRIBUTION REPORT Note: Prepare a separate sheet for each transaction type and one sheet for all transaction types combined. Transaction Type Liability Range ($000) [5] More Than But No More Than Number of Transactions Gross Revenue Excluding Special Charges and Credits And Endorsements [7] 0 0 4.5 4.5 10 10 - 20 20 - 30 30 - 40 40 - 50 50 - 60 60 - 70 70 - 80 80 - 90 90 - 100 100 - 200 200 - 300 300 - 400 400 - 500 500 - 1,000 1,000 - 2,000 2,000 - 3,000 3,000 - 4,000 4,000 - 5,000 5,000 - 15,000 15,000 - 25,000 25,000 - 50,000 50,000 - 75,000 75,000 - 100,000 Over 100,000 ALL SCHEDULE S-4 TEXAS TITLE INSURANCE STATISTICAL PLAN Company Experience Period January 1, 1998 – December 31, 1998 ENDORSEMENT REPORT Endorsement Type [10] Number Issued Revenue [11] TOTAL SCHEDULE S-5 TEXAS TITLE INSURANCE STATISTICAL PLAN Company _________________________________________________ Experience Period January 1, 1998 - December 31, 1998 SPECIAL CHARGES AND CREDITS REPORT Special Charge Type [8] Number of Charges Revenue Received [9] TOTAL Special Credit Type [8] Number of Credits Revenue Foregone [9] TOTAL SCHEDULE S-6 TEXAS TITLE INSURANCE STATISTICAL PLAN Company Experience Period January 1, 1998 – December 31, 1998 CO-INSURANCE REPORT Note: Information should be reported separately for each co-insured risk and for each transaction type. Transaction Type [4] Name of Each Co-Insuring Company [17 a] Policy Number of Each Co-Insuring Company [17 b] Liability Assumed by Each Co-Insuring Company [17 c] SPECIAL INSTRUCTIONS FOR THE COMPLETION OF THE ALTA INCOME STATEMENT SUMMARY AND THE ALTA BALANCE SHEET SUMMARY The reporting schedules for the Income Statement Summary and the Balance Sheet Summary are to be completed in accordance with the instructions for the American Land Title Association Uniform Financial Reporting Plan. In particular, please note that: 1. The Financial Reporting Plan includes all charges in which the underwriter participates, gross as to agency retentions for those charges. 2. In completing the right hand side of the Texas Balance Sheet Summary, first assign Loss Reserves (line 10) and Statutory Reinsurance Reserves (line 11) to Texas. Then allocate lines 12, 13, 15 and 17 to Texas using the common ratio: (Line 9 - (Line 10 + Line 11)) for Texas (Line 9 - (Line 10 + Line 11)) Nationwide Calculate line 14 as the sum of lines 12 and 13; Calculate line 16 as the sum of lines 10, 11, 14 and 15; Calculate line 18 as the sum of lines 16 and 17. This procedure guarantees that the balance sheet will balance, column by column. Out of Balance Conditions will Not Be Accepted. 3. In allocating investment income items on the Income Statement Summary (Lines 16 through 21) to Texas, use the ratio: Balance Sheet Summary Line 16, for Texas Balance Sheet Summary Line 16, Nationwide AMERICAN LAND TITLE ASSOCIATION UNIFORM FINANCIAL REPORTING PLAN INCOME STATEMENT SUMMARY Company YEAR 1998 Texas Elsewhere Total INCOME FROM OPERATIONS 1. Underwriting and Examination Fees 2. Escrow, Settlement, and Other Fees 3. Subtotal (1 + 2) 4. Reinsurance Assumed 5. Reinsurance Ceded 6. Net Increase in Statutory Reserves 7. Subtotal (3 + 4 - 5 - 6) 8. Loss and Loss Adjustment Expenses 9. Commissions/Retentions 10. Other Identifiable Expenses 11. Non-Identifiable Expenses 12. Subtotal (8 + 9 + 10 + 11) 13. Interest Expense 14. Operating Expense (12 + 13) 15. TOTAL INCOME FROM OPERATIONS (7 - 14) INCOME FROM INVESTMENTS 16. Investment Income - Tax Exempt - Before Expenses 17. Investment Income - Dividends - Before Expenses 18. Investment Income - Other - Before Expenses 19. Net Realized Capital Gains (Losses) 20. Net Unrealized Capital Gains (Losses) 21. Investment Expenses and Other Deductions (Excludes Interest Paid on Borrowed Money, Notes and Encumbrances on Real Estate, See Line 13) 22. TOTAL INCOME FROM INVESTMENTS (16 + 17 + 18 + 19 + 20 - 21) AMERICAN LAND TITLE ASSOCIATION UNIFORM FINANCIAL REPORTING PLAN BALANCE SHEET SUMMARY Company YEAR 1998 Texas Elsewhere Total ASSETS Admitted Assets 1. Abstract Plants and Title Plants 2. Other Identifiable Admitted Assets 3. Non-Identifiable Admitted Assets 4. Subtotal (1 + 2 + 3) Non - Admitted Assets 5. Abstract Plants and Title Plants 6. Other Identifiable Non - Admitted Assets 7. Non - Identifiable Non - Admitted Assets 8. Subtotal (5 + 6 + 7) 9. TOTAL ASSETS (4 + 8) LIABILITIES, SURPLUS AND OTHER FUNDS 10. Loss Reserves 11. Statutory Reinsurance Reserves 12. Surplus As Regards Policyholders 13. Contribution to Surplus of Non - Admitted Assets 14. Net Worth (12 + 13) 15. Total Debt Funds 16. Capital (10 + 11 + 14 + 15) 17. Other Liabilities 18. TOTAL LIABILITIES, SURPLUS AND OTHER FUNDS (16 +17) Underwriter Checklist Please provide explanation for deviations at the bottom of this form. Name of Company: ____________________________________________ TYPE Written Premium reported on Schedule T: FORM #, LINE #, Col., Title FORM, Line #, Col., Title FORM 1 Written Premium on Schedule T +/- 5% ALTA Income Statement, Line 1-TEXAS Form 9, Col. 2, Gross Premium Line 7, Col. B, Gross Premiums, Direct Operations Aggregate Form A-D.O., Line A.1 Line 7, Col. D, Gross Premiums, Affiliated Agents Aggregate Form A-Affiliated, Line A.1 Line 8, Col. B, Total Premiums Allocated to Agency Function Aggregate Form A-D.O., line A.3 Line 8, Col. D, Total Premiums Allocated to Agency Function Aggregate Form A-Affiliated, Line A.3 Line 10, Col. E, Investment Income-tax exempt-before expenses ALTA Income Statement, Line 16, TEXAS Line 11, Col. E, Investment Income-dividends-before expenses ALTA Income Statement, Line 17, TEXAS Line 12, Col. E, Investment Income-other-before expenses ALTA Income Statement, Line 18, TEXAS Line 13, Col. E, Realized Capital gains (losses) ALTA Income Statement, Line 19, TEXAS Line 14, Col. E, Net Unrealized Capital gains (losses) ALTA Income Statement, Line 20, TEXAS Line 17, Col A, Service Charges-Underwriters Form 4, Col. 1 Form 4, Col. 2 Aggregate Form A-D.O., Line A.4 - A.11 Form 4, Col. 3 Aggregate Form A-Affiliated, Line A.4-A.11 Line 17, Col E, Service Charges-Investment Form 4, Col. 4 Line 17, Col F, Service Charges-Escrow Form 4, Col. 5 Line 19, Col A, Misc.-Underwriters Form 4, Col. 1 Line 19, Col B, Misc.-Direct Operations Form 4, Col. 2 Line 19, Col D, Misc.-Affiliated Agents Form 4, Col. 3 Line 19, Col E, Misc.-Investment Form 4, Col. 4 Line 19, Col F, Misc.-Escrow Form 4, Col. 5 Line 21, Col. B, Total Income, Direct Operations Aggregate Form A-D.O., line A.14 Line 21, Col. D, Total Income, Affiliated Agents Aggregate Form A-Affiliated, line A.14 Sched. S-1, Total # of Transactions Sched. S-3, ALL, Number of Transactions Form 9, # of Policies, Col. 2 Line 22 G, Total # of Policies Issued Line 7, Col. G, Gross Premiums Line 17, Col D, Service Charges-Affiliated Agents Line 17, Col B, Service Charges-Direct Operations 1 05/20/1999 Underwriter Checklist FORM #, LINE #, Col., Title FORM, Line #, Col., Title FORM 2 Line 1a, Col. B, Salaries-Employees, Direct Operations Aggregate Form A-D.O., line B.1a Line 1a, Col. C, Salaries-Employees, Affiliated Agents Aggregate Form A-Affiliated, line B.1a Line 1b, Col. B, Salaries-Owners & Partners, Direct Operations Aggregate Form A-D.O., line B.1b Line 1b, Col. C, Salaries-Owners & Partners, Affiliated Agents Aggregate Form A-Affiliated, line B.1b Line 2, Col. B, Employee benefits, relations & welfare, Direct Operations Aggregate Form A-D.O., line B.2a Line 2, Col. B, Employee benefits, relations & welfare, Affiliated Agents Aggregate Form A-Affiliated, line B.2a Line 3a, Col. B, Fees paid for title examination & furnishing title evidence-Title Agents Aggregate Form A-D.O., line B.3a Line 3a, Col. C, Fees paid for title examination & furnishing title evidence-Title Agents Aggregate Form A-Affiliated, line B.3a Line 3b, Col. B, Fees paid for title examination & furnishing title evidence-Others Aggregate Form A-D.O., line B.3b Line 3b, Col. C, Fees paid for title examination & furnishing title evidence-Others Aggregate Form A-Affiliated, line B.3b Line 4a, Col. B, Closing costs paid non-employees-Title Agents Aggregate Form A-D.O., line B.4a Line 4a, Col. C, Closing costs paid non-employees-Title Agents Aggregate Form A-Affiliated, line B.4a Line 4b, Col. B, Closing costs paid non-employees-Others Aggregate Form A-D.O., line B.4b Line 4b, Col. C, Closing costs paid non-employees-Others Aggregate Form A-Affiliated, line B.4b Line 5, Col. B, Rent Aggregate Form A-D.O., line B.5 Line 5, Col. C, Rent Aggregate Form A-Affiliated, line B.5 Line 6, Col. B, Utilities Aggregate Form A-D.O., line B.6 Line 6, Col. C, Utilities Aggregate Form A-Affiliated, line B.6 Line 7, Col. B, Accounting & auditing Aggregate Form A-D.O., line B.7 Line 7, Col. C, Accounting & auditing Aggregate Form A-Affiliated, line B.7 Line 8, Col. B, Advertising & promotions Aggregate Form A-D.O., line B.8 Line 8, Col. C, Advertising & promotions Aggregate Form A-Affiliated, line B.8 Line 9, Col. B, Employee travel, lodging & education Aggregate Form A-D.O., line B.9 Line 9, Col. C, Employee travel, lodging & education Aggregate Form A-Affiliated, line B.9 Line 10, Col. B, Insurance Aggregate Form A-D.O., line B.10 Line 10, Col. C, Insurance Aggregate Form A-Affiliated, line B.10 Line 11, Col. B, Interest expense Aggregate Form A-D.O., line B.11 Line 11, Col. C, Interest expense Aggregate Form A-Affiliated, line B.11 Line 12, Col. B, Legal expense Aggregate Form A-D.O., line B.12 Line 12, Col. C, Legal expense Aggregate Form A-Affiliated, line B.12 Line 13, Col. B, License, taxes and fees Aggregate Form A-D.O., line B.13 Line 13, Col. C, License, taxes and fees Aggregate Form A-Affiliated, line B.13 2 05/20/1999 Underwriter Checklist FORM #, LINE #, Col., Title FORM, Line #, Col., Title FORM 2 Line 14, Col. B, Postage & freight Aggregate Form A-D.O., line B.14 Line 14, Col. C, Postage & freight Aggregate Form A-Affiliated, line B.14 Line 15, Col. B, Courier & overnight delivery Aggregate Form A-D.O., line B.15 Line 15, Col. C, Courier & overnight delivery Aggregate Form A-Affiliated, line B.15 Line 16, Col. B, Telephone & facsimile Aggregate Form A-D.O., line B.16 Line 16, Col. C, Telephone & facsimile Aggregate Form A-Affiliated, line B.16 Line 17, Col. B, Printing & photocopying Aggregate Form A-D.O., line B.17 Line 17, Col. C, Printing & photocopying Aggregate Form A-Affiliated, line B.17 Line 18, Col. B, Office Supplies Aggregate Form A-D.O., line B.18 Line 18, Col. C, Office Supplies Aggregate Form A-Affiliated, line B.18 Line 19, Col. B, Equipment & vehicle leases Aggregate Form A-D.O., line B.19 Line 19, Col. C, Equipment & vehicle leases Aggregate Form A-Affiliated, line B.19 Line 20, Col. B, Depreciation Aggregate Form A-D.O., line B.20 Line 20, Col. C, Depreciation Aggregate Form A-Affiliated, line B.20 Line 21, Col. B, Directors fees Aggregate Form A-D.O., line B.21 Line 21, Col. C, Directors fees Aggregate Form A-Affiliated, line B.21 Line 22, Col. B, Dues, boards & assoc. Aggregate Form A-D.O., line B.22 Line 22, Col. C, Dues, boards & assoc. Aggregate Form A-Affiliated, line B.22 Line 23, Col. B, Bad debts Aggregate Form A-D.O., line B.23 Line 23, Col. C, Bad debts Aggregate Form A-Affiliated, line B.23 Line 24, Col. B, Loss adjustment expenses incurred+Line 25 Losses Incurred Aggregate Form A-D.O., line B.24 Line 24, Col. C, Loss adjustment expenses incurred+Line 25 Losses Incurred Aggregate Form A-Affiliated, line B.24 Line 24, Col. F, Loss adjustment expenses incurred+Line 25 Losses Incurred Form 9, Col. 4, Incurred Loss and Allocated Loss Adjustment Expense Line 27, Col. B, Other Aggregate Form A-D.O., line B.32 Line 27, Col. C, Other Aggregate Form A-Affiliated, line B.32 Line 28, Col. B, Tax certificates Aggregate Form A-D.O., line B.25 Line 28, Col. C, Tax certificates Aggregate Form A-Affiliated, line B.25 Line 29, Col. B, Recording fees Aggregate Form A-D.O., line 26 Line 29, Col. C, Recording fees Aggregate Form A-Affiliated, line 26 Line 30, Col. B, Plant lease/update costs Aggregate Form A-D.O., line 27 Line 30, Col. C, Plant lease/update costs Aggregate Form A-Affiliated, line 27 Line 36, Col. B, Damages paid for bad faith suits Aggregate Form A-D.O., line 28 Line 36, Col. C, Damages paid for bad faith suits Aggregate Form A-Affiliated, line 28 3 05/20/1999 Underwriter Checklist FORM #, LINE #, Col., Title FORM, Line #, Col., Title Line 37, Col. B, Fines or penalties for violation of law Aggregate Form A-D.O., line 29 FORM 2 Line 37, Col. C, Fines or penalties for violation of law Aggregate Form A-Affiliated, line 29 Line 38, Col. B, Donations/lobbying Aggregate Form A-D.O., line 30 Line 38, Col. C, Donations/lobbying Aggregate Form A-Affiliated, line 30 Line 39, Col. B, Trade association fees Aggregate Form A-D.O., line 31 Line 39, Col. C, Trade association fees Aggregate Form A-Affiliated, line 31 FORM 7 Compare List to Agent Statistical Reports FORM 8 Compare List to Agent Statistical Reports S-2 Line 3, Gross Revenue Form 1, Line 7G + Line 20 A, B & D ALTA Balance Sheet Total Assets-TEXAS Total Liabilities-TEXAS Total Assets-ELSEWHERE Total Liabilities-ELSEWHERE Total Assets-TOTAL Total Liabilities-TOTAL EXPLANATION -- Please reference error by Form(s), Line(s), Column(s) Use additional sheets as necessary. 4 05/20/1999 A F F I D A V I T FOR TEXAS TITLE INSURANCE COMPANY STATISTICAL REPORT FOR THE CALENDAR YEAR ENDED DECEMBER 31, 1998 THE STATE OF _________________________________ COUNTY OF ____________________________________ _______________________, President, ____________________, Secretary,_____________, Treasurer of the ________________________________________________ being duly sworn, each for himself, deposes and says that they are the above described officers of the said insurer, and that on the 31st day of December last, all of the information contained in Forms 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 Schedules S-1, S-2, S-3, S-4, S-5, S-6, Aggregate Form A and the ALTA Income Statement Summary and the ALTA Balance Sheet Summary of the named Company submitted herewith, together with any necessary related exhibits, schedules and explanations herein contained, annexed or referred to are a full and true statement of income and expenses in accordance with the instructions provided for the year ended on that date, according to the best of their information, knowledge and belief. _________________________________, PRESIDENT _________________________________, SECRETARY _________________________________, TREASURER SUBSCRIBED AND SWORN TO BEFORE ME this the _________ day of ___________________, 19___. ______________________________________ Notary Public ______________________________________ (Printed Name of Notary) My commission expires: ____________________ ______________________________________ Contact Person ______________________________________ Position ______________________________________ Phone Number