Bill Text: IL SB0215 | 2019-2020 | 101st General Assembly | Introduced

---

Bill Title: Amends the Title Insurance Act. Provides for enforcement of the Act by the Department of Insurance (rather than the Department of Financial and Professional Regulation). Provides that all powers, duties, rights, and responsibilities of the Department of Financial and Professional Regulation and the Secretary of Financial and Professional Regulation under the Act are transferred to the Department of Insurance and Director of Insurance, respectively. Provides for the transfer of books, records, papers, documents, property, contracts, causes of action, pending business, and certain funds from the Department of Financial and Professional Regulation to the Department of Insurance. Provides that rules and proposed rules by the Department of Financial and Professional Regulation under the Act shall become rules and proposed rules of the Department of Insurance. Provides that all moneys received by the Department of Insurance under the Act shall be deposited into the Insurance Financial Regulation Fund (rather than the Financial Institution Fund). Makes conforming and grammatical changes throughout the Act and in the State Finance Act.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2021-01-13 - Session Sine Die [SB0215 Detail]

Download: Illinois-2019-SB0215-Introduced.html

---

101ST GENERAL ASSEMBLY State of Illinois 2019 and 2020 SB0215 Introduced 1/31/2019, by Sen. John G. Mulroe SYNOPSIS AS INTRODUCED:
See Index
Amends the Title Insurance Act. Provides for enforcement of the Act by the Department of Insurance (rather than the Department of Financial and Professional Regulation). Provides that all powers, duties, rights, and responsibilities of the Department of Financial and Professional Regulation and the Secretary of Financial and Professional Regulation under the Act are transferred to the Department of Insurance and Director of Insurance, respectively. Provides for the transfer of books, records, papers, documents, property, contracts, causes of action, pending business, and certain funds from the Department of Financial and Professional Regulation to the Department of Insurance. Provides that rules and proposed rules by the Department of Financial and Professional Regulation under the Act shall become rules and proposed rules of the Department of Insurance. Provides that all moneys received by the Department of Insurance under the Act shall be deposited into the Insurance Financial Regulation Fund (rather than the Financial Institution Fund). Makes conforming and grammatical changes throughout the Act and in the State Finance Act.
LRB101 04676 SMS 49685 b
FISCAL NOTE ACT MAY APPLY
A BILL FOR
SB0215 LRB101 04676 SMS 49685 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The State Finance Act is amended by changing
Section 6z-26 as follows:
(30 ILCS 105/6z-26)
Sec. 6z-26. The Financial Institution Fund. All moneys
received by the Department of Financial and Professional
Regulation under the Safety Deposit License Act, the Foreign
Exchange License Act, the Pawners Societies Act, the Sale of
Exchange Act, the Currency Exchange Act, the Sales Finance
Agency Act, the Debt Management Service Act, the Consumer
Installment Loan Act, the Illinois Development Credit
Corporation Act, the Title Insurance Act, the Debt Settlement
Consumer Protection Act, the Debt Management Service Consumer
Protection Fund, and any other Act administered by the
Department of Financial and Professional Regulation as the
successor of the Department of Financial Institutions now or in
the future (unless an Act specifically provides otherwise)
shall be deposited in the Financial Institution Fund
(hereinafter "Fund"), a special fund that is hereby created in
the State Treasury.
Moneys in the Fund shall be used by the Department, subject

SB0215 - 2 - LRB101 04676 SMS 49685 b
to appropriation, for expenses incurred in administering the
above named and referenced Acts.
The Comptroller and the State Treasurer shall transfer from
the General Revenue Fund to the Fund any monies received by the
Department after June 30, 1993, under any of the above named
and referenced Acts that have been deposited in the General
Revenue Fund.
As soon as possible after the end of each calendar year,
the Comptroller shall compare the balance in the Fund at the
end of the calendar year with the amount appropriated from the
Fund for the fiscal year beginning on July 1 of that calendar
year. If the balance in the Fund exceeds the amount
appropriated, the Comptroller and the State Treasurer shall
transfer from the Fund to the General Revenue Fund an amount
equal to the difference between the balance in the Fund and the
amount appropriated.
Nothing in this Section shall be construed to prohibit
appropriations from the General Revenue Fund for expenses
incurred in the administration of the above named and
referenced Acts.
Moneys in the Fund may be transferred to the Professions
Indirect Cost Fund, as authorized under Section 2105-300 of the
Department of Professional Regulation Law of the Civil
Administrative Code of Illinois.
(Source: P.A. 96-1420, eff. 8-3-10.)

SB0215 - 3 - LRB101 04676 SMS 49685 b
Section 10. The Title Insurance Act is amended by changing
Sections 3, 4, 4.1, 5, 6, 7, 8, 9, 12, 13, 14.1, 16, 16.1, 17,
17.1, 18, 19, 20, 21, 21.1, 21.2, and 23 and by adding Section
3.5 as follows:
(215 ILCS 155/3) (from Ch. 73, par. 1403)
Sec. 3. As used in this Act, the words and phrases
following shall have the following meanings unless the context
requires otherwise:
(1) "Title insurance business" or "business of title
insurance" means:
(A) Issuing as insurer or offering to issue as insurer
title insurance; and
(B) Transacting or proposing to transact one or more of
the following activities when conducted or performed in
contemplation of or in conjunction with the issuance of
title insurance;
(i) soliciting or negotiating the issuance of
title insurance;
(ii) guaranteeing, warranting, or otherwise
insuring the correctness of title searches for all
instruments affecting titles to real property, any
interest in real property, cooperative units and
proprietary leases, and for all liens or charges
affecting the same;
(iii) handling of escrows, settlements, or

SB0215 - 4 - LRB101 04676 SMS 49685 b
closings;
(iv) executing title insurance policies;
(v) effecting contracts of reinsurance;
(vi) abstracting, searching, or examining titles;
or
(vii) issuing insured closing letters or closing
protection letters;
(C) Guaranteeing, warranting, or insuring searches or
examinations of title to real property or any interest in
real property, with the exception of preparing an
attorney's opinion of title; or
(D) Guaranteeing or warranting the status of title as
to ownership of or liens on real property and personal
property by any person other than the principals to the
transaction; or
(E) Doing or proposing to do any business substantially
equivalent to any of the activities listed in this
subsection, provided that the preparation of an attorney's
opinion of title pursuant to paragraph (1)(C) is not
intended to be within the definition of "title insurance
business" or "business of title insurance".
(1.5) "Title insurance" means insuring, guaranteeing,
warranting, or indemnifying owners of real or personal property
or the holders of liens or encumbrances thereon or others
interested therein against loss or damage suffered by reason of
liens, encumbrances upon, defects in, or the unmarketability of

SB0215 - 5 - LRB101 04676 SMS 49685 b
the title to the property; the invalidity or unenforceability
of any liens or encumbrances thereon; or doing any business in
substance equivalent to any of the foregoing. "Warranting" for
purpose of this provision shall not include any warranty
contained in instruments of encumbrance or conveyance. Title
insurance is a single line form of insurance, also known as
monoline. An attorney's opinion of title pursuant to paragraph
(1)(C) is not intended to be within the definition of "title
insurance".
(2) "Title insurance company" means any domestic company
organized under the laws of this State for the purpose of
conducting the business of title insurance and any title
insurance company organized under the laws of another State,
the District of Columbia or foreign government and authorized
to transact the business of title insurance in this State.
(3) "Title insurance agent" means a person, firm,
partnership, association, corporation or other legal entity
registered by a title insurance company and authorized by such
company to determine insurability of title in accordance with
generally acceptable underwriting rules and standards in
reliance on either the public records or a search package
prepared from a title plant, or both, and authorized by such
title insurance company in addition to do any of the following:
act as an escrow agent pursuant to subsections (f), (g), and
(h) of Section 16 of this Act, solicit title insurance, collect
premiums, or issue title insurance commitments, policies, and

SB0215 - 6 - LRB101 04676 SMS 49685 b
endorsements of the title insurance company; provided,
however, the term "title insurance agent" shall not include
officers and salaried employees of any title insurance company.
(4) "Producer of title business" is any person, firm,
partnership, association, corporation or other legal entity
engaged in this State in the trade, business, occupation or
profession of (i) buying or selling interests in real property,
(ii) making loans secured by interests in real property, or
(iii) acting as broker, agent, attorney, or representative of
natural persons or other legal entities that buy or sell
interests in real property or that lend money with such
interests as security.
(5) "Associate" is any firm, association, partnership,
corporation or other legal entity organized for profit in which
a producer of title business is a director, officer, or partner
thereof, or owner of a financial interest, as defined herein,
in such entity; any legal entity that controls, is controlled
by, or is under common control with a producer of title
business; and any natural person or legal entity with whom a
producer of title business has any agreement, arrangement, or
understanding or pursues any course of conduct the purpose of
which is to evade the provisions of this Act.
(6) "Financial interest" is any ownership interest, legal
or beneficial, except ownership of publicly traded stock.
(7) "Refer" means to place or cause to be placed, or to
exercise any power or influence over the placing of title

SB0215 - 7 - LRB101 04676 SMS 49685 b
business, whether or not the consent or approval of any other
person is sought or obtained with respect to the referral.
(8) "Escrow Agent" means any title insurance company or any
title insurance agent, including independent contractors of
either, acting on behalf of a title insurance company, which
receives deposits, in trust, of funds or documents, or both,
for the purpose of effecting the sale, transfer, encumbrance or
lease of real property to be held by such escrow agent until
title to the real property that is the subject of the escrow is
in a prescribed condition. An escrow agent conducting closings
shall be subject to the provisions of paragraphs (1) through
(4) of subsection (e) of Section 16 of this Act.
(9) "Independent Escrowee" means any firm, person,
partnership, association, corporation or other legal entity,
other than a title insurance company or a title insurance
agent, which receives deposits, in trust, of funds or
documents, or both, for the purpose of effecting the sale,
transfer, encumbrance or lease of real property to be held by
such escrowee until title to the real property that is the
subject of the escrow is in a prescribed condition. Federal and
State chartered banks, savings and loan associations, credit
unions, mortgage bankers, banks or trust companies authorized
to do business under the Illinois Corporate Fiduciary Act,
licensees under the Consumer Installment Loan Act, real estate
brokers licensed pursuant to the Real Estate License Act of
2000, as such Acts are now or hereafter amended, and licensed

SB0215 - 8 - LRB101 04676 SMS 49685 b
attorneys when engaged in the attorney-client relationship are
exempt from the escrow provisions of this Act. "Independent
Escrowee" does not include employees or independent
contractors of a title insurance company or title insurance
agent authorized by a title insurance company to perform
closing, escrow, or settlement services.
(10) "Single risk" means the insured amount of any title
insurance policy, except that where 2 or more title insurance
policies are issued simultaneously covering different estates
in the same real property, "single risk" means the sum of the
insured amounts of all such title insurance policies. Any title
insurance policy insuring a mortgage interest, a claim payment
under which reduces the insured amount of a fee or leasehold
title insurance policy, shall be excluded in computing the
amount of a single risk to the extent that the insured amount
of the mortgage title insurance policy does not exceed the
insured amount of the fee or leasehold title insurance policy.
(11) "Department" means the Department of Insurance
Financial and Professional Regulation.
(12) "Director" means the Director of Insurance.
"Secretary" means the Secretary of Financial and Professional
Regulation.
(13) "Insured closing letter" or "closing protection
letter" means an indemnification or undertaking to a party to a
real property transaction, from a principal such as a title
insurance company, setting forth in writing the extent of the

SB0215 - 9 - LRB101 04676 SMS 49685 b
principal's responsibility for intentional misconduct or
errors in closing the real property transaction on the part of
a settlement agent, such as a title insurance agent or other
settlement service provider, or an indemnification or
undertaking given by a title insurance company or an
independent escrowee setting forth in writing the extent of the
title insurance company's or independent escrowee's
responsibility to a party to a real property transaction which
indemnifies the party against the intentional misconduct or
errors in closing the real property transaction on the part of
the title insurance company or independent escrowee and
includes protection afforded pursuant to subsections (f), (g),
and (h) of Section 16, Section 16.1, subsection (h) of Section
17, and Section 17.1 of this Act even if such protection is
afforded by contract.
(14) "Residential real property" means a building or
buildings consisting of one to 4 residential units or a
residential condominium unit where at least one of the
residential units or condominium units is occupied or intended
to be occupied as a residence by the purchaser or borrower, or
in the event that the purchaser or borrower is the trustee of a
trust, by a beneficiary of that trust.
(15) "Financial institution" means any bank subject to the
Illinois Banking Act, any savings and loan association subject
to the Illinois Savings and Loan Act of 1985, any savings bank
subject to the Savings Bank Act, any credit union subject to

SB0215 - 10 - LRB101 04676 SMS 49685 b
the Illinois Credit Union Act, and any federally chartered
commercial bank, savings and loan association, savings bank, or
credit union organized and operated in this State pursuant to
the laws of the United States.
(Source: P.A. 100-485, eff. 9-8-17.)
(215 ILCS 155/3.5 new)
Sec. 3.5. Transfer of enforcement of Act to the Department
of Insurance. On and after the effective date of this
amendatory Act of the 101st General Assembly:
(1) All powers, duties, rights, and responsibilities
of the Department of Financial and Professional Regulation
under this Act are transferred to the Department of
Insurance.
(2) All powers, duties, rights, and responsibilities
of the Secretary of Financial and Professional Regulation
under this Act are transferred to the Director of
Insurance.
(3) All books, records, papers, documents, property
(real and personal), contracts, causes of action, and
pending business of the Department of Financial and
Professional Regulation for the purposes of this Act shall
be transferred to the Department of Insurance.
(4) All unexpended appropriations and balances and
other funds available for use by the Department of
Financial and Professional Regulation deposited into the

SB0215 - 11 - LRB101 04676 SMS 49685 b
Financial Institution Fund from funds received under this
Act shall be transferred for use by the Department of
Insurance for the purposes of this Act into the Insurance
Financial Regulation Fund. Unexpended balances so
transferred shall be expended only for the purpose for
which the appropriations were originally made.
(5) Any rules of the Department of Financial and
Professional Regulation for the purposes of this Act that
are in full force on the effective date of this amendatory
Act of the 101st General Assembly shall become the rules of
the Department of Insurance. This Section does not affect
the legality of any such rules in the Illinois
Administrative Code.
(6) Any proposed rules filed with the Secretary of
State by the Department of Financial and Professional
Regulation for the purposes of this Act that are pending in
the rulemaking process on the effective date of this
amendatory Act of the 101st General Assembly, and that
pertain to the powers, duties, rights, and
responsibilities transferred under this Section, shall be
deemed to have been filed by the Department of Insurance.
As soon as practicable, the Department of Insurance shall
revise and clarify the rules transferred to it under this
Section using the procedures for recodification of rules
available under the Illinois Administrative Procedure Act,
except that existing title, part, and section numbering for

SB0215 - 12 - LRB101 04676 SMS 49685 b
the affected rules may be retained. The Department of
Insurance may propose and adopt under the Illinois
Administrative Procedure Act such other rules of the
Department of Financial and Professional Regulation for
the purposes of this Act that will now be administered by
the Department of Insurance.
(215 ILCS 155/4) (from Ch. 73, par. 1404)
Sec. 4. Deposits.
(a) Before doing business in the State of Illinois, a title
insurance company must file with and have approved by the
Director Secretary cash or bonds of the United States, this
State or any body politic of this State in amounts as specified
in subsection (b). The deposit is not to be otherwise pledged
or subject to distribution among creditors or stockholders
until all claims of escrow depositors, claims of policyholders,
and claims under reinsurance contracts have been paid in full
or discharged, reinsured, or otherwise assumed by a title
insurance company authorized to do business under this Act. The
cash, bonds, and securities so deposited may be exchanged for
other such securities. No such cash, bond, or security shall be
sold or transferred by the Director Secretary except on order
of the circuit court or as provided in subsection (d). As long
as the company depositing such securities remains solvent, the
company shall be permitted to receive from the Director
Secretary the interest on such deposit.

SB0215 - 13 - LRB101 04676 SMS 49685 b
(b) The deposit required under subsection (a) must have a
then current value of $1,000,000. All deposits shall be held
for the benefit of any insured under a policy the title
insurance company issued or named party to a written escrow it
accepted. The deposit is not to be otherwise pledged or subject
to distribution among creditors or stockholders.
(c) The Director Secretary may provide for custody of the
deposits by any trust company or bank located in this State and
qualified to do business under the Corporate Fiduciary Act, as
now or hereafter amended. The compensation, if any, of such
custodian shall be paid by the depositing company. When the
required deposits have been made by a title insurance company,
the Director Secretary shall certify that the company has
complied with the provisions of this Section and is authorized
to transact the business of insuring and guaranteeing titles to
real estate.
(d) If, at any time, a title insurance company causes all
of its unexpired policies, escrow deposits, and reinsurance
obligations in Illinois to be paid in full, cancelled,
discharged, reinsured, or otherwise assumed by another title
insurance company authorized to do business under this Act, the
Director Secretary shall, upon application of the company,
verified by the oath of its president or secretary and on being
satisfied by an examination of its books and its officers under
oath that all of its policies are paid in full, cancelled,
discharged, reinsured, or otherwise assumed, authorize the

SB0215 - 14 - LRB101 04676 SMS 49685 b
release of any bond or deposit posted under this Section.
(e) The Director Secretary may revoke the certificate of
authority of a company that fails to maintain the deposit
required by this Section. The Director Secretary shall give
notice of that revocation to the company as provided by this
Act, and during the time of the revocation, the company may not
conduct a title insurance business. A company may complete
contractual obligations, such as issuing a policy where the
obligations have already been assumed. However, it may not
solicit new business, complete new searches or examinations, or
close transactions. A revocation shall not be set aside until a
good and sufficient deposit has been filed with the Director
Secretary and the company is otherwise in compliance with this
Act.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/4.1)
Sec. 4.1. Minimum capital and surplus. Before doing
business in the State of Illinois, a title insurance company
must satisfy the Director Secretary that it has a minimum
capital and surplus of $2,000,000. The Director Secretary may
provide the forms and standards for this purpose by rule.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/5) (from Ch. 73, par. 1405)
Sec. 5. Certificate of authority required. It is unlawful

SB0215 - 15 - LRB101 04676 SMS 49685 b
for any company to engage or to continue in the business of
title insurance without first procuring from the Director
Secretary a certificate of authority stating that the company
has complied with the requirements of Section 4 of this Act. An
insurer that transacts any class of insurance other than title
insurance anywhere in the United States is not eligible for the
issuance of a certificate of authority to transact title
insurance in this State nor for a renewal of a certificate of
authority.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/6) (from Ch. 73, par. 1406)
Sec. 6. Reinsurance.
(a) A title insurance company may obtain reinsurance for
all or any part of its liability under one or more of its title
insurance policies or reinsurance agreements and may also
reinsure title insurance policies issued by other title
insurance companies on risks located in this State or
elsewhere.
(a-5) Notwithstanding any other provision of this Act, a
title insurance company may obtain reinsurance for all or any
part of its liability under one or more of its title insurance
policies from an assuming insurer with a financial strength
rating of A- or better from A.M. Best Company, Inc., or with an
alternative rating the Department may approve that the
Department determines is an equivalent rating by another

SB0215 - 16 - LRB101 04676 SMS 49685 b
recognized rating organization.
(b) A title insurance company licensed to do business in
this State shall retain at least $100,000 of primary liability
for policies it issues, unless a lesser sum is authorized by
the Director Secretary. A lesser sum may be retained at the
request of an insured for a particular policy. This subsection
(b) applies only to policies issued on or after the effective
date of this amendatory Act of the 94th General Assembly.
(Source: P.A. 100-570, eff. 6-1-18.)
(215 ILCS 155/7) (from Ch. 73, par. 1407)
Sec. 7. Investments.
(a) Subject to the specific provisions of this Section, the
Director Secretary may, after a notice and hearing, order a
domestic title insurance company to limit or withdraw from
certain investments, or discontinue certain investment
practices, to the extent the Director Secretary finds that such
investments or investment practices endanger the solvency of
the company. The Director Secretary may consider the general
investment provisions of the Illinois Insurance Code, as now or
hereafter amended, in exercising the authority granted under
this subsection (a).
(b) A domestic title insurance company may invest in title
plants. For determination of the financial condition of such
title insurance company, a title plant shall be treated as an
asset valued at actual cost except that the combined value of

SB0215 - 17 - LRB101 04676 SMS 49685 b
all title plants owned shall be limited for asset valuation
purposes to 50% of the surplus as regards policyholders as
shown on the most recent annual statement of the title
insurance company.
(c) Any investment of a domestic title insurance company
acquired before the effective date of this Act and which, under
this Section, would be considered ineligible as an investment
on that date shall be disposed of within 2 years of the
effective date of this Act. The Director Secretary, upon
application and proof that forced sale of any such investment
would be contrary to the best interests of the title insurer or
its policyholders, may extend the period for disposal of the
investment for a reasonable time.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/8) (from Ch. 73, par. 1408)
Sec. 8. Retained liability.
(a) The net retained liability of a title insurance company
for a single risk on property located in this State, whether
assumed directly or as reinsurance, may not exceed the total
surplus to policyholders as shown in the most recent annual
statement of the title insurance company on file with the
Department.
(b) The Director Secretary may waive the limitation of this
Section for a particular risk upon application of the title
insurance company and for good cause shown.

SB0215 - 18 - LRB101 04676 SMS 49685 b
(Source: P.A. 100-570, eff. 6-1-18.)
(215 ILCS 155/9) (from Ch. 73, par. 1409)
Sec. 9. Impairment of capital; discontinuance of issuance
of new policies; penalty.
(a) Whenever the capital of any title insurance company
authorized to do business under this Act is determined by the
circuit court, upon the application of the Director Secretary,
to be impaired to the extent of 25% of its capital, or to have
otherwise become unsafe, the Director Secretary shall cancel
the authority of the company to do business.
(b) The Director Secretary shall give notice as provided by
this Act to the company to discontinue doing business until its
capital has been made good. The title insurance company may
continue to issue policies and perform other actions that are
required to complete contractual obligations undertaken prior
to the notice.
(c) Any officer or management employee who continues to
take orders for title insurance or close transactions on behalf
of a company after the notice to discontinue doing business,
and before its capital has been made good, may, for each
offense, be fined as provided by this Act.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/12) (from Ch. 73, par. 1412)
Sec. 12. Examinations; compliance.

SB0215 - 19 - LRB101 04676 SMS 49685 b
(a) The Director Secretary or his or her authorized
representative shall have the power and authority, and it shall
be his or her duty, to cause to be visited and examined
annually any title insurance company doing business under this
Act, and to verify and compel compliance with the provisions of
law governing it.
(b) The Director Secretary or his or her authorized agent
shall have power and authority to compel compliance with the
provisions of this Act and shall, only upon the showing of good
cause, require any title insurance company to take all legal
means to obtain the appropriate records of its registered
agents and make them available for examination at a time and
place designated by the Director Secretary. Expenses incurred
in the course of such examinations will be the responsibility
of the title insurance company. In the event that a present or
former registered agent or its successor refuses or is unable
to cooperate with a title insurance company in furnishing the
records requested by the Director Secretary or his or her
authorized agent, then the Director Secretary or his or her
authorized agent shall have the power and authority to obtain
those records directly from the registered agent.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/13) (from Ch. 73, par. 1413)
Sec. 13. Annual statement.
(a) Each title insurance company shall file with the

SB0215 - 20 - LRB101 04676 SMS 49685 b
Department during the month of March of each year, a statement
under oath, of the condition of such company on the
thirty-first day of December next preceding disclosing the
assets, liabilities, earnings and expenses of the company. The
report shall be in such form and shall contain such additional
statements and information as to the affairs, business, and
conditions of the company as the Director Secretary may from
time to time prescribe or require.
(b) By June 1 of each year, a title insurance company must
file with the Department a copy of its most recent audited
financial statements.
(c) If determined to be necessary and appropriate by the
Department, a title insurance company shall provide a summary
describing its professional reinsurance placed outside of the
title insurance industry.
(Source: P.A. 100-570, eff. 6-1-18.)
(215 ILCS 155/14.1)
Sec. 14.1. Insurance Financial Regulation Fund Financial
Institution Fund. All moneys received by the Department of
Insurance Financial and Professional Regulation under this Act
shall be deposited into in the Insurance Financial Regulation
Fund Financial Institution Fund created under Section 6z-26 of
the State Finance Act.
(Source: P.A. 98-463, eff. 8-16-13.)

SB0215 - 21 - LRB101 04676 SMS 49685 b
(215 ILCS 155/16) (from Ch. 73, par. 1416)
Sec. 16. Title insurance agents.
(a) No person, firm, partnership, association, corporation
or other legal entity shall act as or hold itself out to be a
title insurance agent unless duly registered by a title
insurance company with the Director Secretary.
(b) Each application for registration shall be made on a
form specified by the Director Secretary and prepared by each
title insurance company which the agent represents. The title
insurance company shall retain the copy of the application and
forward a copy to the Director Secretary.
(c) Every applicant for registration, except a firm,
partnership, association, limited liability company, or
corporation, must be 18 years or more of age. Included in every
application for registration of a title insurance agent,
including a firm, partnership, association, limited liability
company, or corporation, shall be an affidavit of the applicant
title insurance agent, signed and notarized in front of a
notary public, affirming that the applicant and every owner,
officer, director, principal, member, or manager of the
applicant has never been convicted or pled guilty to any felony
or misdemeanor involving a crime of theft or dishonesty or
otherwise accurately disclosing any such felony or misdemeanor
involving a crime of theft or dishonesty. No person who has had
a conviction or pled guilty to any felony or misdemeanor
involving theft or dishonesty may be registered by a title

SB0215 - 22 - LRB101 04676 SMS 49685 b
insurance company without a written notification to the
Director Secretary disclosing the conviction or plea, and no
such person may serve as an owner, officer, director,
principal, or manager of any registered title insurance agent
without the written permission of the Director Secretary.
(d) Registration shall be made annually by a filing with
the Director Secretary; supplemental registrations for new
title insurance agents to be added between annual filings shall
be made from time to time in the manner provided by the
Director Secretary; registrations shall remain in effect
unless revoked or suspended by the Director Secretary or
voluntarily withdrawn by the registrant or the title insurance
company.
(e) Funds deposited in connection with any escrows,
settlements, or closings shall be deposited in a separate
fiduciary trust account or accounts in a bank or other
financial institution insured by an agency of the federal
government unless the instructions provide otherwise. The
funds shall be the property of the person or persons entitled
thereto under the provisions of the escrow, settlement, or
closing and shall be segregated by escrow, settlement, or
closing in the records of the escrow agent. The funds shall not
be subject to any debts of the escrowee and shall be used only
in accordance with the terms of the individual escrow,
settlement, or closing under which the funds were accepted.
Interest received on funds deposited with the escrow agent

SB0215 - 23 - LRB101 04676 SMS 49685 b
in connection with any escrow, settlement, or closing shall be
paid to the depositing party unless the instructions provide
otherwise.
The escrow agent shall maintain separate records of all
receipts and disbursements of escrow, settlement, or closing
funds.
The escrow agent shall comply with any rules adopted by the
Director Secretary pertaining to escrow, settlement, or
closing transactions.
(f) A title insurance agent shall not act as an escrow
agent in a nonresidential real property transaction where the
amount of settlement funds on deposit with the escrow agent is
less than $2,000,000 or in a residential real property
transaction unless the title insurance agent, title insurance
company, or another authorized title insurance agent has
committed for the issuance of title insurance in that
transaction and the title insurance agent is authorized to act
as an escrow agent on behalf of the title insurance company for
which the commitment for title insurance has been issued. The
authorization under the preceding sentence shall be given
either (1) by an agency contract with the title insurance
company which contract, in compliance with the requirements set
forth in subsection (g) of this Section, authorizes the title
insurance agent to act as an escrow agent on behalf of the
title insurance company or (2) by a closing protection letter
in compliance with the requirements set forth in Section 16.1

SB0215 - 24 - LRB101 04676 SMS 49685 b
of this Act, issued by the title insurance company to the
seller, buyer, borrower, and lender. A closing protection
letter shall not be issued by a title insurance agent. The
provisions of this subsection (f) shall not apply to the
authority of a title insurance agent to act as an escrow agent
under subsection (g) of Section 17 of this Act.
(g) If an agency contract between the title insurance
company and the title insurance agent is the source of the
authority under subsection (f) of this Section for a title
insurance agent to act as escrow agent for a real property
transaction, then the agency contract shall provide for no less
protection from the title insurance company to all parties to
the real property transaction than the title insurance company
would have provided to those parties had the title insurance
company issued a closing protection letter in conformity with
Section 16.1 of this Act.
(h) A title insurance company shall be liable for the acts
or omissions of its title insurance agent as an escrow agent if
the title insurance company has authorized the title insurance
agent under subsections (f) and (g) of this Section 16 and only
to the extent of the liability undertaken by the title
insurance company in the agency agreement or closing protection
letter. The liability, if any, of the title insurance agent to
the title insurance company for acts and omissions of the title
insurance agent as an escrow agent shall not be limited or
otherwise modified because the title insurance company has

SB0215 - 25 - LRB101 04676 SMS 49685 b
provided closing protection to a party or parties to a real
property transaction escrow, settlement, or closing. The
escrow agent shall not charge a fee for protection provided by
a title insurance company to parties to real property
transactions under subsections (f) and (g) of this Section 16
and Section 16.1, but shall collect from the parties the fee
charged by the title insurance company and shall promptly remit
the fee to the title insurance company. The title insurance
company may charge the parties a reasonable fee for protection
provided pursuant to subsections (f) and (g) of this Section 16
and Section 16.1 and shall not pay any portion of the fee to
the escrow agent. The payment of any portion of the fee to the
escrow agent by the title insurance company, shall be deemed a
prohibited inducement or compensation in violation of Section
24 of this Act.
(i) The Director Secretary shall adopt and amend such rules
as may be required for the proper administration and
enforcement of this Section 16 consistent with the federal Real
Estate Settlement Procedures Act and Section 24 of this Act.
(Source: P.A. 98-398, eff. 1-1-14; 98-832, eff. 1-1-15; 99-104,
eff. 1-1-16.)
(215 ILCS 155/16.1)
Sec. 16.1. Closing or settlement protection.
(a) Notwithstanding the provisions of item (iii) of
paragraph (B) of subsection (1) and subsections (3) and (8) of

SB0215 - 26 - LRB101 04676 SMS 49685 b
Section 3 and Section 16 of this Act, a title insurance company
or title insurance agent is not authorized to act as an escrow
agent in a nonresidential real property transaction where the
amount of settlement funds on deposit with the escrow agent is
less than $2,000,000 or in a residential real property
transaction unless as part of the same transaction a
commitment, binder, or title insurance policy and closing
protection letters protecting the buyer's or borrower's,
lender's, and seller's interests have been issued by the title
insurance company on whose behalf the commitment, binder, or
title insurance policy has been issued. Closing protection
letters are not required when the authorization for the title
insurance agent to act as an escrow agent is given by an agency
contract with the title insurance company pursuant to
subsections (f), (g), and (h) of Section 16 of this Act, but
shall be issued by the title insurance company upon the request
of a party to a nonresidential real property transaction where
the amount of settlement funds on deposit with the escrow agent
is less than $2,000,000 or in a residential real property
transaction.
(b) Unless otherwise agreed to between a title insurance
company and a protected person or entity, a closing protection
letter under this Section shall indemnify all parties to a real
property transaction against actual loss, not to exceed the
amount of the settlement funds deposited with the escrow agent.
The closing protection letter shall in any event indemnify all

SB0215 - 27 - LRB101 04676 SMS 49685 b
parties to a real property transaction when such losses arise
out of:
(1) failure of the escrow agent to comply with written
closing instructions to the extent that they relate to (A)
the status of the title to an interest in land or the
validity, enforceability, and priority of the lien of a
mortgage on an interest in land, including the obtaining of
documents and the disbursement of funds necessary to
establish the status of title or lien or (B) the obtaining
of any other document specifically required by a party to
the real property transaction, but only to the extent that
the failure to obtain such other document affects the
status of the title to an interest in land or the validity,
enforceability, and priority of the lien of a mortgage on
an interest in land; or
(2) fraud, dishonesty, or negligence of the escrow
agent in handling funds or documents in connection with
closings to the extent that the fraud, dishonesty, or
negligence relates to the status of the title to the
interest in land or to the validity, enforceability, and
priority of the lien of a mortgage on an interest in land
or, in the case of a seller, to the extent that the fraud,
dishonesty, or negligence relates to funds paid to or on
behalf of, or which should have been paid to or on behalf
of, the seller.
(c) The indemnification under a closing protection letter

SB0215 - 28 - LRB101 04676 SMS 49685 b
may include limitations on the liability of the title insurance
company for any of the following:
(1) Failure of the escrow agent to comply with closing
instructions that require title insurance protection
inconsistent with that set forth in the title insurance
commitment for the real property transaction. Instructions
that require the removal of specific exceptions to title or
compliance with the requirements contained in the title
insurance commitment shall not be deemed to be
inconsistent.
(2) Loss or impairment of funds in the course of
collection or while on deposit with a bank due to bank
failure, insolvency, or suspension, except such as shall
result from failure of the escrow agent closer to comply
with written closing instructions to deposit the funds in a
bank that is designated by name by a party to the real
property transaction.
(3) Mechanics' and materialmen's liens in connection
with sale, purchase, lease, or construction loan
transactions, except to the extent that protection against
such liens is afforded by a title insurance commitment or
policy issued by the escrow agent.
(4) Failure of the escrow agent to comply with written
closing instructions to the extent that such instructions
require a determination by the escrow agent of the
validity, enforceability, or effectiveness of any document

SB0215 - 29 - LRB101 04676 SMS 49685 b
described in subitem (B) of item (1) of subsection (b) of
this Section.
(5) Fraud, dishonesty, or negligence of an employee,
agent, attorney, or broker, who is not also the escrow
agent or an independent contract closer of the escrow
agent, of the indemnified party to the real property
transaction.
(6) The settlement or release of any claim by the
indemnified party to the real property transaction without
the written consent of the title insurance company.
(7) Any matters created, suffered, assumed, or agreed
to by, or known to, the indemnified party to the real
property transaction without the written consent of the
title insurance company.
The closing protection letter may also include reasonable
additional provisions concerning the dollar amount of
protection, provided such limit is not less than the amount
deposited with the escrow agent, arbitration, subrogation,
claim notices, and other conditions and limitations that do not
materially impair the protection required by this Section 16.1.
(d) This Section shall not apply to the authority of a
title insurance company and title insurance agent to act as an
escrow agent under subsection (g) of Section 17 of this Act.
(e) The Director Secretary shall adopt and amend such rules
as may be required for the proper administration and
enforcement of this Section 16.1 consistent with the federal

SB0215 - 30 - LRB101 04676 SMS 49685 b
Real Estate Settlement Procedures Act and Section 24 of this
Act.
(Source: P.A. 96-1454, eff. 1-1-11.)
(215 ILCS 155/17) (from Ch. 73, par. 1417)
Sec. 17. Independent escrowees.
(a) Every independent escrowee shall be subject to the same
certification and deposit requirements to which title
insurance companies are subject under Section 4 of this Act.
(b) No person, firm, corporation or other legal entity
shall hold itself out to be an independent escrowee unless it
has been issued a certificate of authority by the Director
Secretary.
(c) Every applicant for a certificate of authority, except
a firm, partnership, association or corporation, must be 18
years or more of age.
(d) Every certificate of authority shall remain in effect
one year unless revoked or suspended by the Director Secretary
or voluntarily surrendered by the holder.
(e) An independent escrowee may engage in the escrow,
settlement, or closing business, or any combination of such
business, and operate as an escrow, settlement, or closing
agent, provided that:
(1) Funds deposited in connection with any escrow,
settlement, or closing shall be deposited in a separate
fiduciary trust account or accounts in a bank or other

SB0215 - 31 - LRB101 04676 SMS 49685 b
financial institution insured by an agency of the federal
government unless the instructions provide otherwise. Such
funds shall be the property of the person or persons
entitled thereto under the provisions of the escrow,
settlement, or closing and shall be segregated by escrow,
settlement or closing in the records of the independent
escrowee. Such funds shall not be subject to any debts of
the escrowee and shall be used only in accordance with the
terms of the individual escrow, settlement or closing under
which the funds were accepted.
(2) Interest received on funds deposited with the
independent escrowee in connection with any escrow,
settlement or closing shall be paid to the depositing party
unless the instructions provide otherwise.
(3) The independent escrowee shall maintain separate
records of all receipt and disbursement of escrow,
settlement or closing funds.
(4) The independent escrowee shall comply with any
rules or regulations promulgated by the Director Secretary
pertaining to escrow, settlement or closing transactions.
(f) The Director Secretary or his or her authorized
representative shall have the power and authority to visit and
examine at any time any independent escrowee certified under
this Act and to verify and compel compliance with the
provisions of this Act.
(g) A title insurance company or title insurance agent, not

SB0215 - 32 - LRB101 04676 SMS 49685 b
qualified as an independent escrowee, may act in the capacity
of an escrow agent when it is supplying an abstract of title,
grantor-grantee search, tract search, lien search, tax
assessment search, or other limited purpose search to the
parties to the transaction even if it is not issuing a title
insurance commitment or title insurance policy. A title
insurance agent may act as an escrow agent only when
specifically authorized in writing on forms prescribed by the
Director Secretary by a title insurance company that has duly
registered the agent with the Director Secretary and only when
notice of the authorization is provided to and receipt thereof
is acknowledged by the Director Secretary. The authority
granted to a title insurance agent may be limited or revoked at
any time by the title insurance company.
(h) An independent escrowee may, pursuant to Section 17.1
of this Act, issue an insured closing letter if, in addition to
complying with the same certification and deposit requirements
that title insurance companies are subject to under Section 4
of this Act, the independent escrowee:
(1) Satisfies the Director Secretary that it has a
minimum capital and surplus of $2,000,000. The Director
Secretary may provide the forms and standards for this
purpose by rule. This paragraph applies only to independent
escrowees licensed under this Act for the first time on or
after the effective date of this amendatory Act of the
100th General Assembly.

SB0215 - 33 - LRB101 04676 SMS 49685 b
(2) Files with and has approved by the Director
Secretary proof of a fidelity bond in the minimum amount of
$2,000,000 per occurrence.
(3) Establishes and maintains a statutory closing
protection letter reserve for the protection of parties
named in warranties of services consisting of a sum of 25%
of the closing protection letter revenue received by the
independent escrowee on or after the effective date of this
amendatory Act of the 100th General Assembly. The reserve
shall be reported as a liability of the independent
escrowee in its financial statements. Amounts placed in the
statutory closing protection letter reserve shall be
deducted in determining the net profit of the independent
escrowee for the year. Except as provided in this
subsection, assets in value equal to the statutory closing
protection letter reserve are not subject to distribution
among creditors, stockholders, or other owners of the
independent escrowee until all claims of parties named in
warranties of services have been paid in full and
discharged.
(4) Releases from the statutory closing protection
letter reserve a sum equal to 10% of the amount added to
the reserve during a calendar year on July 1 of each of the
5 years following the year in which the sum was added and
releases from the statutory closing protection letter
reserve a sum equal to 3 1/3% of the amount added to the

SB0215 - 34 - LRB101 04676 SMS 49685 b
reserve during that year on each succeeding July 1 until
the entire amount for that year has been released.
The Director Secretary shall adopt and amend rules as may
be required for the proper administration and enforcement of
this subsection (h) consistent with the federal Real Estate
Settlement and Procedures Act and Section 24 of this Act.
(Source: P.A. 100-485, eff. 9-8-17.)
(215 ILCS 155/17.1)
Sec. 17.1. Closing or settlement protection; independent
escrowees.
(a) Notwithstanding the provisions of item (iii) of
paragraph (B) of subsection (1) and subsection (9) of Section 3
of this Act, an independent escrowee is not authorized to act
pursuant to subsection (9) of Section 3 of this Act in a
nonresidential real property transaction where the amount of
settlement funds on deposit with the escrow agent is less than
$2,000,000 or in a residential real property transaction
unless, as part of the same transaction, closing protection
letters protecting the buyer's or borrower's, lender's, and
seller's interests have been issued by the independent
escrowee.
(b) Unless otherwise agreed to between an independent
escrowee and a protected person or entity, a closing protection
letter under this Section shall indemnify all parties to a real
property transaction against actual loss, not to exceed the

SB0215 - 35 - LRB101 04676 SMS 49685 b
amount of the settlement funds deposited with the independent
escrowee. The closing protection letter shall in any event
indemnify all parties to a real property transaction when such
losses arise out of:
(1) failure of the independent escrowee to comply with
written closing instructions to the extent that they relate
to (A) the status of the title to an interest in land or
the validity, enforceability, and priority of the lien of a
mortgage on an interest in land, including the obtaining of
documents and the disbursement of funds necessary to
establish the status of title or lien or (B) the obtaining
of any other document specifically required by a party to
the real property transaction, but only to the extent that
the failure to obtain such other document affects the
status of the title to an interest in land or the validity,
enforceability, and priority of the lien of a mortgage on
an interest in land; or
(2) fraud, dishonesty, or negligence of the
independent escrowee in handling funds or documents in
connection with closings to the extent that the fraud,
dishonesty, or negligence relates to the status of the
title to the interest in land or to the validity,
enforceability, and priority of the lien of a mortgage on
an interest in land or, in the case of a seller, to the
extent that the fraud, dishonesty, or negligence relates to
funds paid to or on behalf of, or which should have been

SB0215 - 36 - LRB101 04676 SMS 49685 b
paid to or on behalf of, the seller.
(c) The indemnification under a closing protection letter
may include limitations on the liability of the independent
escrowee for any of the following:
(1) Failure of the independent escrowee to comply with
closing instructions that require title insurance
protection inconsistent with that set forth in the title
insurance commitment for the real property transaction.
Instructions that require the removal of specific
exceptions to title or compliance with the requirements
contained in the title insurance commitment shall not be
deemed to be inconsistent.
(2) Loss or impairment of funds in the course of
collection or while on deposit with a bank due to bank
failure, insolvency, or suspension, except such as shall
result from failure of the independent escrowee closer to
comply with written closing instructions to deposit the
funds in a bank that is designated by name by a party to
the real property transaction.
(3) Mechanics' and materialmen's liens in connection
with sale, purchase, lease, or construction loan
transactions, except to the extent that protection against
such liens is afforded by a title insurance commitment or
policy issued by the title insurance agent or title
insurance company.
(4) Failure of the independent escrowee to comply with

SB0215 - 37 - LRB101 04676 SMS 49685 b
written closing instructions to the extent that such
instructions require a determination by the independent
escrowee of the validity, enforceability, or effectiveness
of any document described in item (B) of paragraph (1) of
subsection (b) of this Section.
(5) Fraud, dishonesty, or negligence of an employee,
agent, attorney, or broker, who is not also the independent
escrowee or an independent contract closer of the
independent escrowee, of the indemnified party to the real
property transaction.
(6) The settlement or release of any claim by the
indemnified party to the real property transaction without
the written consent of the independent escrowee.
(7) Any matters created, suffered, assumed, or agreed
to by, or known to, the indemnified party to the real
property transaction without the written consent of the
independent escrowee.
The closing protection letter may also include reasonable
additional provisions concerning the dollar amount of
protection, provided the limit is no less than the amount
deposited with the independent escrowee, arbitration,
subrogation, claim notices, and other conditions and
limitations that do not materially impair the protection
required by this Section.
(d) The Director Secretary shall adopt and amend rules as
may be required for the proper administration and enforcement

SB0215 - 38 - LRB101 04676 SMS 49685 b
of this Section consistent with the federal Real Estate
Settlement Procedures Act and Section 24 of this Act.
(Source: P.A. 100-485, eff. 9-8-17.)
(215 ILCS 155/18) (from Ch. 73, par. 1418)
Sec. 18. No referral payments; kickbacks.
(a) Application of this Section is limited to residential
properties of 4 or fewer units, at least one of which units is
occupied or to be occupied by an owner, legal or beneficial.
(b) No title insurance company, independent escrowee, or
title insurance agent may issue a title insurance policy to, or
provide services to an applicant if it knows or has reason to
believe that the applicant was referred to it by any producer
of title business or by any associate of such producer, where
the producer, the associate, or both, have a financial interest
in the title insurance company, independent escrowee, or title
insurance agent to which business is referred unless the
producer has disclosed to any party paying for the products or
services, or his or her representative, the financial interest
of the producer of title business or associate referring the
title business and a disclosure of an estimate of those charges
to be paid as described in Section 19. Such disclosure must be
made in writing on forms prescribed by the Director Secretary
prior to the time that the commitment for title insurance is
issued. The title insurance company, independent escrowee, or
title insurance agent shall maintain the disclosure forms for a

SB0215 - 39 - LRB101 04676 SMS 49685 b
period of 3 years.
(c) Each title insurance company, independent escrowee,
and title insurance agent shall file with the Director
Secretary, on forms prescribed by the Director Secretary,
reports setting forth the names and addresses of those persons,
if any, who have had a financial interest in the title
insurance company, independent escrowee, or title insurance
agent during the calendar year, who are known or reasonably
believed by the title insurance company, independent escrowee,
or title insurance agent to be producers of title business or
associates of producers.
(1) Each title insurance company and independent
escrowee shall file the report required under this
subsection with its application for a certificate of
authority and at any time there is a change in the
information provided in the last report.
(2) Each title insurance agent shall file the report
required under this subsection with its title insurance
company for inclusion with its application for
registration and at any time there is a change in the
information provided in its last report.
(3) Each title insurance company, independent
escrowee, or title insurance agent doing business on the
effective date of this Act shall file the report required
under this subsection within 90 days after such effective
date.

SB0215 - 40 - LRB101 04676 SMS 49685 b
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/19) (from Ch. 73, par. 1419)
Sec. 19. Director Secretary powers; pricing. Nothing
contained in this Act shall be construed as giving any
authority to the Director Secretary to set or otherwise adjust
the fees charged to the parties to the transaction for:
(1) issuing a title insurance policy, including any
service charge or administration fee for the issuance of a
title insurance policy;
(2) abstracting, searching and examining title;
(3) preparing or issuing preliminary reports, property
profiles, commitments, binders, or like product;
(4) closing fees, escrow fees, settlement fees, and
like charges.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/20) (from Ch. 73, par. 1420)
Sec. 20. Rules and regulations. The Director Secretary
shall rely upon federal regulations and opinion letters and may
adopt rules and regulations as needed to implement and
interpret the provisions of this Act.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/21) (from Ch. 73, par. 1421)
Sec. 21. Regulatory action.

SB0215 - 41 - LRB101 04676 SMS 49685 b
(a) The Director Secretary may refuse to grant, and may
suspend or revoke, any certificate of authority, registration,
or license issued pursuant to this Act or may impose a fine for
a violation of this Act if he determines that the holder of or
applicant for such certificate, registration or license:
(1) has intentionally made a material misstatement or
fraudulent misrepresentation in relation to a matter
covered by this Act;
(2) has misappropriated or tortiously converted to its
own use, or illegally withheld, monies held in a fiduciary
capacity;
(3) has demonstrated untrustworthiness or incompetency
in transacting the business of guaranteeing titles to real
estate in such a manner as to endanger the public;
(4) has materially misrepresented the terms or
conditions of contracts or agreements to which it is a
party;
(5) has paid any commissions, discounts or any part of
its premiums, fees or other charges to any person in
violation of any State or federal law or regulations or
opinion letters issued under the federal Real Estate
Settlement Procedures Act of 1974;
(6) has failed to comply with the deposit and reserve
requirements of this Act or any other requirements of this
Act;
(7) has committed fraud or misrepresentation in

SB0215 - 42 - LRB101 04676 SMS 49685 b
applying for or procuring any certificate of authority,
registration, or license issued pursuant to this Act;
(8) has a conviction or plea of guilty or plea of nolo
contendere in this State or any other jurisdiction to (i)
any felony or (ii) a misdemeanor, an essential element of
which is dishonesty or fraud or larceny, embezzlement, or
obtaining money, property, or credit by false pretenses or
by means of a confidence game;
(9) has been disciplined by another state, the District
of Columbia, a territory, foreign nation, a governmental
agency, or any entity authorized to impose discipline if at
least one of the grounds for that discipline is the same as
or equivalent to one of the grounds for which a title
insurance company, title insurance agent, or independent
escrowee may be disciplined under this Act or if at least
one of the grounds for that discipline involves dishonesty;
a certified copy of the record of the action by the other
state or jurisdiction shall be prima facie evidence
thereof;
(10) has advertising that is inaccurate, misleading,
or contrary to the provisions of this Act;
(11) has knowingly and willfully made any substantial
misrepresentation or untruthful advertising;
(12) has made any false promises of a character likely
to influence, persuade, or induce;
(13) has knowingly failed to account for or remit any

SB0215 - 43 - LRB101 04676 SMS 49685 b
money or documents coming into the possession of a title
insurance company, title insurance agent, or independent
escrowee that belong to others;
(14) has engaged in dishonorable, unethical, or
unprofessional conduct of a character likely to deceive,
defraud, or harm the public;
(15) has violated the terms of a disciplinary order
issued by the Department;
(16) has disregarded or violated any provision of this
Act or the published rules adopted by the Department to
enforce this Act or has aided or abetted any individual,
partnership, registered limited liability partnership,
limited liability company, or corporation in disregarding
any provision of this Act or the published rules; or
(17) has acted as a title insurance company, title
insurance agent, or independent escrowee without a
certificate of authority, registration, or license after
the title insurance company, title insurance agent, or
independent escrowee's certificate of authority,
registration, or license was inoperative.
(b) In every case where a registration or certificate is
suspended or revoked, or an application for a registration or
certificate or renewal thereof is refused, the Director
Secretary shall serve notice of his or her action, including a
statement of the reasons for his or her action, as provided by
this Act. When a notice of suspension or revocation of a

SB0215 - 44 - LRB101 04676 SMS 49685 b
certificate of authority is given to a title insurance company,
the Director Secretary shall also notify all the registered
agents of that title insurance company of the Director's
Secretary's action.
(c) In the case of a refusal to issue or renew a
certificate or accept a registration, the applicant or
registrant may request in writing, within 30 days after the
date of service, a hearing. In the case of a refusal to renew,
the expiring registration or certificate shall be deemed to
continue in force until 30 days after the service of the notice
of refusal to renew, or if a hearing is requested during that
period, until a final order is entered pursuant to such
hearing.
(d) The suspension or revocation of a registration or
certificate shall take effect upon service of notice thereof.
The holder of any such suspended registration or certificate
may request in writing, within 30 days of such service, a
hearing.
(e) In cases of suspension or revocation of registration
pursuant to subsection (a), the Director Secretary may, in the
public interest, issue an order of suspension or revocation
which shall take effect upon service of notification thereof.
Such order shall become final 60 days from the date of service
unless the registrant requests in writing, within such 60 days,
a formal hearing thereon. In the event a hearing is requested,
the order shall remain temporary until a final order is entered

SB0215 - 45 - LRB101 04676 SMS 49685 b
pursuant to such hearing.
(f) Hearing shall be held at such time and place as may be
designated by the Director Secretary either in the City of
Springfield, the City of Chicago, or in the county in which the
principal business office of the affected registrant or
certificate holder is located.
(g) The suspension or revocation of a registration or
certificate or the refusal to issue or renew a registration or
certificate shall not in any way limit or terminate the
responsibilities of any registrant or certificate holder
arising under any policy or contract of title insurance to
which it is a party. No new contract or policy of title
insurance may be issued, nor may any existing policy or
contract to title insurance be renewed by any registrant or
certificate holder during any period of suspension or
revocation of a registration or certificate.
(h) The Director Secretary may issue a cease and desist
order to a title insurance company, agent, or other entity
doing business without the required license or registration,
when in the opinion of the Director Secretary, the company,
agent, or other entity is violating or is about to violate any
provision of this Act or any law or of any rule or condition
imposed in writing by the Department.
The Director Secretary may issue the cease and desist order
without notice and before a hearing.
The Director Secretary shall have the authority to

SB0215 - 46 - LRB101 04676 SMS 49685 b
prescribe rules for the administration of this Section.
If it is determined that the Director Secretary had the
authority to issue the cease and desist order, he may issue
such orders as may be reasonably necessary to correct,
eliminate or remedy such conduct.
Any person or company subject to an order pursuant to this
Section is entitled to judicial review of the order in
accordance with the provisions of the Administrative Review
Law.
The powers vested in the Director Secretary by this Section
are additional to any and all other powers and remedies vested
in the Director Secretary by law, and nothing in this Section
shall be construed as requiring that the Director Secretary
shall employ the powers conferred in this Section instead of or
as a condition precedent to the exercise of any other power or
remedy vested in the Director Secretary.
(Source: P.A. 98-398, eff. 1-1-14.)
(215 ILCS 155/21.1)
Sec. 21.1. Receiver and involuntary liquidation.
(a) The Director's Secretary's proceedings under this
Section shall be the exclusive remedy and the only proceedings
commenced in any court for the dissolution of, the winding up
of the affairs of, or the appointment of a receiver for a title
insurance company.
(b) If the Director Secretary, with respect to a title

SB0215 - 47 - LRB101 04676 SMS 49685 b
insurance company, finds that (i) its capital is impaired or it
is otherwise in an unsound condition, (ii) its business is
being conducted in an unlawful, fraudulent, or unsafe manner,
(iii) it is unable to continue operations, or (iv) its
examination has been obstructed or impeded, the Director
Secretary may give notice to the board of directors of the
title insurance company of his or her finding or findings. If
the Director's Secretary's findings are not corrected to his or
her satisfaction within 60 days after the company receives the
notice, the Director Secretary shall take possession and
control of the title insurance company, its assets, and assets
held by it for any person for the purpose of examination,
reorganization, or liquidation through receivership.
If, in addition to making a finding as provided in this
subsection (b), the Director Secretary is of the opinion and
finds that an emergency that may result in serious losses to
any person exists, the Director Secretary may, in his or her
discretion, without having given the notice provided for in
this subsection, and whether or not proceedings under
subsection (a) of this Section have been instituted or are then
pending, take possession and control of the title insurance
company and its assets for the purpose of examination,
reorganization, or liquidation through receivership.
(c) The Director Secretary may take possession and control
of a title insurance company, its assets, and assets held by it
for any person by posting upon the premises of each office

SB0215 - 48 - LRB101 04676 SMS 49685 b
located in the State of Illinois at which it transacts its
business as a title insurance company a notice reciting that
the Director Secretary is assuming possession pursuant to this
Act and the time when the possession shall be deemed to
commence.
(d) Promptly after taking possession and control of a title
insurance company the Director Secretary, represented by the
Attorney General, shall file a copy of the notice posted upon
the premises in the Circuit Court of either Cook County or
Sangamon County, which cause shall be entered as a court action
upon the dockets of the court under the name and style of "In
the matter of the possession and control by the Director of
Insurance Secretary of the Department of Financial and
Professional Regulation of (insert the name of the title
insurance company)". If the Director Secretary determines
(which determination may be made at the time of, or at any time
subsequent to, taking possession and control of a title
insurance company) that no practical possibility exists to
reorganize the title insurance company after reasonable
efforts have been made, the Director Secretary, represented by
the Attorney General, shall also file a complaint, if it has
not already been done, for the appointment of a receiver or
other proceeding as is appropriate under the circumstances. The
court where the cause is docketed shall be vested with the
exclusive jurisdiction to hear and determine all issues and
matters pertaining to or connected with the Director's

SB0215 - 49 - LRB101 04676 SMS 49685 b
Secretary's possession and control of the title insurance
company as provided in this Act, and any further issues and
matters pertaining to or connected with the Director's
Secretary's possession and control as may be submitted to the
court for its adjudication.
The Director Secretary, upon taking possession and control
of a title insurance company, may, and if not previously done
shall, immediately upon filing a complaint for dissolution make
an examination of the affairs of the title insurance company or
appoint a suitable person to make the examination as the
Director's Secretary's agent. The examination shall be
conducted in accordance with and pursuant to the authority
granted under Section 12 of this Act. The person conducting the
examination shall have and may exercise on behalf of the
Director Secretary all of the powers and authority granted to
the Director Secretary under Section 12. A copy of the report
shall be filed in any dissolution proceeding filed by the
Director Secretary. The reasonable fees and necessary expenses
of the examining person, as approved by the Director Secretary
or as recommended by the Director Secretary and approved by the
court if a dissolution proceeding has been filed, shall be
borne by the subject title insurance company and shall have the
same priority for payment as the reasonable and necessary
expenses of the Director Secretary in conducting an
examination. The person appointed to make the examination shall
make a proper accounting, in the manner and scope as determined

SB0215 - 50 - LRB101 04676 SMS 49685 b
by the Director Secretary to be practical and advisable under
the circumstances, on behalf of the title insurance company and
no guardian ad litem need be appointed to review the
accounting.
(e) The Director Secretary, upon taking possession and
control of a title insurance company and its assets, shall be
vested with the full powers of management and control
including, but not limited to, the following:
(1) the power to continue or to discontinue the
business;
(2) the power to stop or to limit the payment of its
obligations;
(3) the power to collect and to use its assets and to
give valid receipts and acquittances therefor;
(4) the power to transfer title and liquidate any bond
or deposit made under Section 4 of this Act;
(5) the power to employ and to pay any necessary
assistants;
(6) the power to execute any instrument in the name of
the title insurance company;
(7) the power to commence, defend, and conduct in the
title insurance company's name any action or proceeding in
which it may be a party;
(8) the power, upon the order of the court, to sell and
convey the title insurance company's assets, in whole or in
part, and to sell or compound bad or doubtful debts upon

SB0215 - 51 - LRB101 04676 SMS 49685 b
such terms and conditions as may be fixed in that order;
(9) the power, upon the order of the court, to make and
to carry out agreements with other title insurance
companies, financial institutions, or with the United
States or any agency of the United States for the payment
or assumption of the title insurance company's
liabilities, in whole or in part, and to transfer assets
and to make guaranties, in whole or in part, in connection
therewith;
(10) the power, upon the order of the court, to borrow
money in the name of the title insurance company and to
pledge its assets as security for the loan;
(11) the power to terminate his or her possession and
control by restoring the title insurance company to its
board of directors;
(12) the power to appoint a receiver which may be the
Director of Insurance Secretary of the Department of
Financial and Professional Regulation, another title
insurance company, or another suitable person and to order
liquidation of the title insurance company as provided in
this Act; and
(13) the power, upon the order of the court and without
the appointment of a receiver, to determine that the title
insurance company has been closed for the purpose of
liquidation without adequate provision being made for
payment of its obligations, and thereupon the title

SB0215 - 52 - LRB101 04676 SMS 49685 b
insurance company shall be deemed to have been closed on
account of inability to meet its obligations to its
insureds or escrow depositors.
(f) Upon taking possession, the Director Secretary shall
make an examination of the condition of the title insurance
company, an inventory of the assets and, unless the time shall
be extended by order of the court or unless the Director
Secretary shall have otherwise settled the affairs of the title
insurance company pursuant to the provisions of this Act,
within 90 days after the time of taking possession and control
of the title insurance company, the Director Secretary shall
either terminate his or her possession and control by restoring
the title insurance company to its board of directors or
appoint a receiver, which may be the Director of Insurance
Secretary of the Department of Financial and Professional
Regulation, another title insurance company, or another
suitable person and order the liquidation of the title
insurance company as provided in this Act. All necessary and
reasonable expenses of the Director's Secretary's possession
and control shall be a priority claim and shall be borne by the
title insurance company and may be paid by the Director
Secretary from the title insurance company's own assets as
distinguished from assets held for any other person.
(g) If the Director Secretary takes possession and control
of a title insurance company and its assets, any period of
limitation fixed by a statute or agreement that would otherwise

SB0215 - 53 - LRB101 04676 SMS 49685 b
expire on a claim or right of action of the title insurance
company, on its own behalf or on behalf of its insureds or
escrow depositors, or upon which an appeal must be taken or a
pleading or other document filed by the title insurance company
in any pending action or proceeding, shall be tolled until 6
months after the commencement of the possession, and no
judgment, lien, levy, attachment, or other similar legal
process may be enforced upon or satisfied, in whole or in part,
from any asset of the title insurance company or from any asset
of an insured or escrow depositor while it is in the possession
of the Director Secretary.
(h) If the Director Secretary appoints a receiver to take
possession and control of the assets of insureds or escrow
depositors for the purpose of holding those assets as fiduciary
for the benefit of the insureds or escrow depositors pending
the winding up of the affairs of the title insurance company
being liquidated and the appointment of a successor escrowee
for those assets, any period of limitation fixed by statute,
rule of court, or agreement that would otherwise expire on a
claim or right of action in favor of or against the insureds or
escrow depositors of those assets or upon which an appeal must
be taken or a pleading or other document filed by a title
insurance company on behalf of an insured or escrow depositor
in any pending action or proceeding shall be tolled for a
period of 6 months after the appointment of a receiver, and no
judgment, lien, levy, attachment, or other similar legal

SB0215 - 54 - LRB101 04676 SMS 49685 b
process shall be enforced upon or satisfied, in whole or in
part, from any asset of the insured or escrow depositor while
it is in the possession of the receiver.
(i) If the Director Secretary determines at any time that
no reasonable possibility exists for the title insurance
company to be operated by its board of directors in accordance
with the provisions of this Act after reasonable efforts have
been made and that it should be liquidated through
receivership, he or she shall appoint a receiver. The Director
Secretary may require of the receiver such bond and security as
the Director Secretary deems proper. The Director Secretary,
represented by the Attorney General, shall file a complaint for
the dissolution or winding up of the affairs of the title
insurance company in a court of the county in which the
principal office of the title insurance company is located and
shall cause notice to be given in a newspaper of general
circulation once each week for 4 consecutive weeks so that
persons who may have claims against the title insurance company
may present them to the receiver and make legal proof thereof
and notifying those persons and all to whom it may concern of
the filing of a complaint for the dissolution or winding up of
the affairs of the title insurance company and stating the name
and location of the court. All persons who may have claims
against the assets of the title insurance company, as
distinguished from the assets of insureds and escrow depositors
held by the title insurance company, and the receiver to whom

SB0215 - 55 - LRB101 04676 SMS 49685 b
those persons have presented their claims may present the
claims to the clerk of the court, and the allowance or
disallowance of the claims by the court in connection with the
proceedings shall be deemed an adjudication in a court of
competent jurisdiction. Within a reasonable time after
completion of publication, the receiver shall file with the
court a correct list of all creditors of the title insurance
company as shown by its books, who have not presented their
claims and the amount of their respective claims after allowing
adjusted credit, deductions, and set-offs as shown by the books
of the title insurance company. The claims so filed shall be
deemed proven unless objections are filed thereto by a party or
parties interested therein within the time fixed by the court.
(j) The receiver for a title insurance company has the
power and authority and is charged with the duties and
responsibilities as follows:
(1) To take possession of and, for the purpose of the
receivership, title to the books, records, and assets of
every description of the title insurance company.
(2) To proceed to collect all debts, dues, and claims
belonging to the title insurance company.
(3) To sell and compound all bad and doubtful debts on
such terms as the court shall direct.
(4) To sell the real and personal property of the title
insurance company, as distinguished from the real and
personal property of the insureds or escrow depositors, on

SB0215 - 56 - LRB101 04676 SMS 49685 b
such terms as the court shall direct.
(5) To file with the Director Secretary a copy of each
report that he or she makes to the court, together with
such other reports and records as the Director Secretary
may require.
(6) To sue and defend in his or her own name and with
respect to the affairs, assets, claims, debts, and choses
in action of the title insurance company.
(7) To surrender to the insureds and escrow depositors
of the title insurance company, when requested in writing
directed to the receiver by them, the escrowed funds (on a
pro rata basis), and escrowed documents in the receiver's
possession upon satisfactory proof of ownership and
determination by the receiver of available escrow funds.
(8) To redeem or take down collateral hypothecated by
the title insurance company to secure its notes and other
evidence of indebtedness whenever the court deems it to be
in the best interest of the creditors of the title
insurance company and directs the receiver so to do.
(k) Whenever the receiver finds it necessary in his or her
opinion to use and employ money of the title insurance company
in order to protect fully and benefit the title insurance
company by the purchase or redemption of property, real or
personal, in which the title insurance company may have any
rights by reason of any bond, mortgage, assignment, or other
claim thereto, the receiver may certify the facts together with

SB0215 - 57 - LRB101 04676 SMS 49685 b
the receiver's opinions as to the value of the property
involved and the value of the equity the title insurance
company may have in the property to the court, together with a
request for the right and authority to use and employ so much
of the money of the title insurance company as may be necessary
to purchase the property, or to redeem the property from a sale
if there was a sale, and if the request is granted, the
receiver may use so much of the money of the title insurance
company as the court may have authorized to purchase the
property at the sale.
The receiver shall deposit daily all moneys collected by
him or her in any State or national bank approved by the court.
The deposits shall be made in the name of the Director
Secretary, in trust for the receiver, and be subject to
withdrawal upon the receiver's order or upon the order of those
persons the Director Secretary may designate. The moneys may be
deposited without interest, unless otherwise agreed. The
receiver shall do the things and take the steps from time to
time under the direction and approval of the court that may
reasonably appear to be necessary to conserve the title
insurance company's assets and secure the best interests of the
creditors, insureds, and escrow depositors of the title
insurance company. The receiver shall record any judgment of
dissolution entered in a dissolution proceeding and thereupon
turn over to the Director Secretary a certified copy of the
judgment.

SB0215 - 58 - LRB101 04676 SMS 49685 b
The receiver may cause all assets of the insureds and
escrow depositors of the title insurance company to be
registered in the name of the receiver or in the name of the
receiver's nominee.
For its services in administering the escrows held by the
title insurance company during the period of winding up the
affairs of the title insurance company, the receiver is
entitled to be reimbursed for all costs and expenses incurred
by the receiver and shall also be entitled to receive out of
the assets of the individual escrows being administered by the
receiver during the period of winding up the affairs of the
title insurance company and prior to the appointment of a
successor escrowee the usual and customary fees charged by an
escrowee for escrows or reasonable fees approved by the court.
The receiver, during its administration of the escrows of
the title insurance company during the winding up of the
affairs of the title insurance company, shall have all of the
powers that are vested in trustees under the terms and
provisions of the Trusts and Trustees Act.
Upon the appointment of a successor escrowee, the receiver
shall deliver to the successor escrowee all of the assets
belonging to each individual escrow to which the successor
escrowee succeeds, and the receiver shall thereupon be relieved
of any further duties or obligations with respect thereto.
(l) The receiver shall, upon approval by the court, pay all
claims against the assets of the title insurance company

SB0215 - 59 - LRB101 04676 SMS 49685 b
allowed by the court pursuant to subsection (i) of this
Section, as well as claims against the assets of insureds and
escrow depositors of the title insurance company in accordance
with the following priority:
(1) All necessary and reasonable expenses of the
Director's Secretary's possession and control and of its
receivership shall be paid from the assets of the title
insurance company.
(2) All usual and customary fees charged for services
in administering escrows shall be paid from the assets of
the individual escrows being administered. If the assets of
the individual escrows being administered are
insufficient, the fees shall be paid from the assets of the
title insurance company.
(3) Secured claims, including claims for taxes and
debts due the federal or any state or local government,
that are secured by liens perfected prior to the date of
filing of the complaint for dissolution, shall be paid from
the assets of the title insurance company.
(4) Claims by policyholders, beneficiaries, insureds,
and escrow depositors of the title insurance company shall
be paid from the assets of the insureds and escrow
depositors. If there are insufficient assets of the
insureds and escrow depositors, claims shall be paid from
the assets of the title insurance company.
(5) Any other claims due the federal government shall

SB0215 - 60 - LRB101 04676 SMS 49685 b
be paid from the assets of the title insurance company.
(6) Claims for wages or salaries, excluding vacation,
severance, and sick leave pay earned by employees for
services rendered within 90 days prior to the date of
filing of the complaint for dissolution, shall be paid from
the assets of the title insurance company.
(7) All other claims of general creditors not falling
within any priority under this subsection (l) including
claims for taxes and debts due any state or local
government which are not secured claims and claims for
attorney's fees incurred by the title insurance company in
contesting the dissolution shall be paid from the assets of
the title insurance company.
(8) Proprietary claims asserted by an owner, member, or
stockholder of the title insurance company in receivership
shall be paid from the assets of the title insurance
company.
The receiver shall pay all claims of equal priority
according to the schedule set out in this subsection, and shall
not pay claims of lower priority until all higher priority
claims are satisfied. If insufficient assets are available to
meet all claims of equal priority, those assets shall be
distributed pro rata among those claims. All unclaimed assets
of the title insurance company shall be deposited with the
receiver to be paid out by him or her when such claims are
submitted and allowed by the court.

SB0215 - 61 - LRB101 04676 SMS 49685 b
(m) At the termination of the receiver's administration,
the receiver shall petition the court for the entry of a
judgment of dissolution. After a hearing upon the notice as the
court may prescribe, the court may enter a judgment of
dissolution whereupon the title insurance company's corporate
existence shall be terminated and the receivership concluded.
(n) The receiver shall serve at the pleasure of the
Director Secretary and upon the death, inability to act,
resignation, or removal by the Director Secretary of a
receiver, the Director Secretary may appoint a successor, and
upon the appointment, all rights and duties of the predecessor
shall at once devolve upon the appointee.
(o) Whenever the Director Secretary shall have taken
possession and control of a title insurance company or a title
insurance agent and its assets for the purpose of examination,
reorganization or liquidation through receivership, or
whenever the Director Secretary shall have appointed a receiver
for a title insurance company or title insurance agent and
filed a complaint for the dissolution or winding up of its
affairs, and the title insurance company or title insurance
agent denies the grounds for such actions, it may at any time
within 10 days apply to the Circuit Court of Cook or Sangamon
County to enjoin further proceedings in the premises; and the
Court shall cite the Director Secretary to show cause why
further proceedings should not be enjoined, and if the Court
shall find that grounds do not exist, the Court shall make an

SB0215 - 62 - LRB101 04676 SMS 49685 b
order enjoining the Director Secretary or any receiver acting
under his or her direction from all further proceedings on
account of the alleged grounds.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/21.2)
Sec. 21.2. Notice.
(a) Notice of any action by the Director Secretary under
this Act or regulations or orders promulgated under it shall be
made either personally or by registered or certified mail,
return receipt requested, and by sending a copy of the notice
by telephone facsimile or electronic mail, if known and
operating, and if unknown or not operating, then by regular
mail. Service by mail shall be deemed completed if the notice
is deposited as registered or certified mail in the post
office, postage paid, addressed to the last known address
specified in the application for the certificate of authority
to do business or certificate of registration of the holder or
registrant.
(b) The Director Secretary shall notify all registered
agents of a title insurance company when that title insurance
company's certificate of authority is suspended or revoked.
(Source: P.A. 94-893, eff. 6-20-06.)
(215 ILCS 155/23) (from Ch. 73, par. 1423)
Sec. 23. Violation; penalties.

SB0215 - 63 - LRB101 04676 SMS 49685 b
(a) Any violation of any of the provisions of this Act and,
beginning January 1, 2013, any violation of any of the
provisions of Article 3 of the Residential Real Property
Disclosure Act shall constitute a business offense and shall
subject the party violating the same to a penalty of $1000 for
each offense.
(b) Nothing contained in this Section shall affect the
right of the Director Secretary to revoke or suspend a title
insurance company's or independent escrowee's certificate of
authority or a title insurance agent's registration under any
other Section of this Act.
(Source: P.A. 97-891, eff. 8-3-12.)
SB0215 - 64 - LRB101 04676 SMS 49685 b
INDEX
Statutes amended in order of appearance
30 ILCS 105/6z-26
215 ILCS 155/3 from Ch. 73, par. 1403
215 ILCS 155/3.5 new
215 ILCS 155/4 from Ch. 73, par. 1404
215 ILCS 155/4.1
215 ILCS 155/5 from Ch. 73, par. 1405
215 ILCS 155/6 from Ch. 73, par. 1406
215 ILCS 155/7 from Ch. 73, par. 1407
215 ILCS 155/8 from Ch. 73, par. 1408
215 ILCS 155/9 from Ch. 73, par. 1409
215 ILCS 155/12 from Ch. 73, par. 1412
215 ILCS 155/13 from Ch. 73, par. 1413
215 ILCS 155/14.1
215 ILCS 155/16 from Ch. 73, par. 1416
215 ILCS 155/16.1
215 ILCS 155/17 from Ch. 73, par. 1417
215 ILCS 155/17.1
215 ILCS 155/18 from Ch. 73, par. 1418
215 ILCS 155/19 from Ch. 73, par. 1419
215 ILCS 155/20 from Ch. 73, par. 1420
215 ILCS 155/21 from Ch. 73, par. 1421
215 ILCS 155/21.1
215 ILCS 155/21.2
SB0215 - 65 - LRB101 04676 SMS 49685 b