January Title Tidbit

Guest speaker, Mr. Adam Leitman-Bailey, expounded on the Comprehensive Insurance Disclosure Act and the potential problems for the title industry. New York State Comprehensive Insurance Disclosure Act. (S7502) Really for claims and litigation, but something everyone should know. When a case is started, within 60 days (90 days in the amendment), the defendant is required to turn over all insurance policies, the names of the insurance policies, companies, directors, officers, anyone involved, and the amount of money that is covered, to the plaintiff. The amendment will limit that to the amount of money covered by the policy. The amendment will curtail a lot of the information required to be disclosed. This is problematic for the title industry because, under current law, the insurance underwriter needs to disclose what loss might be covered, and we do not know what the loss is until the end of the case. If you have a market value rider v. a standard policy, there will need to be a hearing to determine what the property is worth at a given point in time. What date do we decide under the mortgage policy we are giving up? Are we using the 2006 policy, or are we using the new forms? Is it possible to comply by listing potential scenarios that might affect valuation? Why are we worried about this? If the insurance policy might contribute towards the payment of damages, the existence of that policy must be disclosed. The Bill was signed on December 31.