What's happening
This bill clarifies and defines prohibited inducements and rebates in title insurance, while allowing ordinary marketing activities.
Why it matters
Defines what counts as an illegal inducement or compensation in title insurance. the new language specifies that a "benefit" is only a prohibited inducement if it is given with the intent to compensate for the placement of specific title insurance business, either in the past or future. This provides much-needed clarity for industry participants about what is and isn’t allowed.
Affirms the legality of ordinary marketing activities. the bill makes explicit that standard marketing practices (such as general advertising or outreach) are permitted as long as they are not intended as a reward for specific business referrals. This distinction helps prevent overbroad enforcement and allows legitimate competition and consumer education to continue.
Seeks to curb hidden kickbacks and protect consumers. by clarifying and tightening the definition of prohibited payments or benefits, the bill aims to reduce steering of business based on secret incentives, fostering a more transparent and fair marketplace for homebuyers and real estate professionals.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Headline styles
Clarify Title Insurance Rules
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to insurance
- Referred to insurance
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Define Title Insurance Inducements
In Senate Committee · Insurance · Sponsor Neil D. Breslin
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
402
2019-2020 Regular Sessions
IN ASSEMBLY (Prefiled)
January 9, 2019
Introduced by M. of A. CAHILL, PAULIN, WEPRIN, RA, HYNDMAN, MAGNARELLI, WOERNER, McDONOUGH, ENGLEBRIGHT, PHEFFER AMATO, JAFFEE, ABINANTI, RAIA, BRAUNSTEIN, THIELE, BYRNE, DiPIETRO -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to the prohibition of commissions and rebates
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subsection (d) of section 6409 of the insurance law, as amended by section 17 of part V of chapter 57 of the laws of 2014, is amended to read as follows:
(d) (1) No title insurance corporation, title insurance agent, or any other person acting for or on behalf of the title insurance corporation or title insurance agent, shall offer or make, directly or indirectly, any rebate of any portion of the fee, premium or charge made, or pay or give to any applicant, or to any person, firm, or corporation acting as agent, representative, attorney, or employee of the owner, lessee, mortgagee or the prospective owner, lessee, or mortgagee of the real property or any interest therein, either directly or indirectly, any commission, any part of its fees or charges, or any other consideration or valuable thing, as an inducement for, or as compensation for, any title insurance business, nor shall any applicant, or any person, firm, or corporation acting as agent, representative, attorney, or employee of the owner, lessee, mortgagee or of the prospective owner, lessee, or mortgagee of the real property or anyone having any interest in real property knowingly receive, directly or indirectly, any such rebate or other consideration or valuable thing. Any person or entity who violates this section shall be subject to a penalty of [(1)] (i) five thousand dollars; or [(2)] (ii) up to ten times the amount of any compensation or rebate received or paid in the case of a title insurance corporation or
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03106-01-9
A. 402 2
title insurance agent; or [(3)] (iii) up to five times the amount of any compensation or rebate received or paid; or [(4)] (iv) in the case of an applicant for title insurance that covers real property used predominantly for residential purposes, and which consists of not more than four dwelling units, other than hotels and motels, an amount not to exceed the compensation or rebate received or paid, when such applicant knew that it was a violation to receive such rebate, or other consideration or valuable thing; provided, however, if such applicant did not know that it was a violation to receive such rebate, or other consideration or valuable thing, he or she shall not be assessed a penalty under this [subdivision] subsection.
(2) For the purposes of this subsection, "an inducement for, or as compensation for, any title insurance business" shall mean a benefit given with the intention to compensate or offer compensation, directly or indirectly, for any past or present placement for a particular piece of title insurance business to any applicant, or person, firm, or corporation acting as agent, representative, attorney, or employee of the owner, lessee, mortgagee or the prospective owner, lessee, or mortgagee of the real property or any interest therein. Nothing contained in paragraph one of this subsection to the contrary shall prohibit any title insurance corporation or title insurance agent, or any other person acting for or on behalf of the title insurance corporation or title insurance agent, from undertaking any usual and customary marketing activity aimed at acquainting present and prospective customers with the advantages of using a particular title insurer or title insurance agent that are not intended for the purpose of a reward for the future placement of, or the past placement, of a particular piece of title insurance business.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.