40-1139. Same; financial responsibility requirements. (a) The title insurance agent who handles escrow, settlement or closing accounts shall file with the commissioner a surety bond or irrevocable letter of credit in a form acceptable to the commissioner, issued by an insurance company or financial institution authorized to conduct business in this state, securing the applicant's or the title insurance agent's faithful performance of all duties and obligations set out in K.S.A. 40-1135 through 40-1141, and amendments thereto.
(b) The terms of the bond or irrevocable letter of credit shall be:
(1) The surety bond shall provide that such bond may not be terminated without 30 days prior written notice to the commissioner.
(2) An irrevocable letter of credit shall be issued by a bank which is insured by the federal deposit insurance corporation or its successor if such letter of credit is initially issued for a term of at least one year and by its terms is automatically renewed at each expiration date for at least an additional one-year term unless at least 30 days prior written notice of intention not to renew is given to the commissioner of insurance.
(c) The amount of the surety bond or irrevocable letter of credit for those agents servicing real estate transactions on property located in counties having a certain population shall be required as follows:
(1) $100,000 surety bond or irrevocable letter of credit in counties having a population of 40,001 and over;
(2) $50,000 surety bond or irrevocable letter of credit in counties having a population of 20,001 to 40,000; and
(3) $25,000 surety bond or irrevocable letter of credit in counties having a population of 20,000 or under.
(d) The surety bond or irrevocable letter of credit shall be for the benefit of any person suffering a loss if the title insurance agent converts or misappropriates money received or held in escrow, deposit or trust accounts while acting as a title insurance agent providing any escrow or settlement services.
History: L. 1999, ch. 95, ยง 12; July 1.
Structure Kansas Statutes
Article 11 - General Provisions Relative To Casualty, Surety And Fidelity Companies
40-1101 Insurance company defined.
40-1103 Paid-up capital stock and surplus required; deposits of securities; amount.
40-1104 Regulation of foreign companies; capital stock and surplus required.
40-1105 Revocation of certificate of authority, when.
40-1107 Maximum amount of one risk or hazard; exceptions.
40-1107a Same; title insurance company; exceptions.
40-1108 Reserves of surety company.
40-1110 Supplemental coverages or endorsements in connection with liability policies.
40-1112a Discount for motor vehicle insurance, when; conditions.
40-1119 Same; false or misleading information; penalty.
40-1126 Reports by insurers of health care providers of any actions to state board of healing arts.
40-1127 Same; content of reports.
40-1134 Title insurance companies; policy requirements.
40-1135 Title insurance agencies; purpose.
40-1137 Same; agents, authorized activities; use of client funds; escrow accounts, audit.
40-1138 Same; agent record requirements; inspection.
40-1139 Same; financial responsibility requirements.