OR DFR Bulletin 1994-02: Title Insurance May Not Use Schedule B to Add Coverage

INSURANCE DIVISION BULLETIN INS 94-2

DATE: March 1, 1994

TO: All Title Insurers and Title Insurance Agents in Oregon

It has come to our attention that the title industry is using Schedule B in title insurance policies to

provide additional coverage in the case of two mortgages applying to one piece of property, especially

when one mortgage is a fixed interest rate and the other is a variable rate.

Adding coverage through the use of Schedule B constitutes usage of unauthorized rates and forms in

contravention of ORS 737.320 and 742.003.

This is not the intention of Schedule B. This schedule is used for exceptions from coverage and

clarification of those exemptions only. Additional coverage should be provided for by endorsements

with appropriate rate schedules which are filed subject to prior approval by this division.

Any requests for special endorsements should follow the guidelines from the division letter of March 8,

1991, which stated, "all affirmative coverages written into policy schedules require the same approvals

as special endorsements, except for affirmative coverages clarifying the effect of an exception on policy

coverages otherwise being provided."

All title insurers and title insurance agents in Oregon should cease this activity of providing such

additional coverages in Schedule B. Failure to do so will result in sanctions.

Two policies should be issued until such time as an appropriate endorsement is filed and approved by

this division.

The Insurance Division is working with the Oregon Land Title Association to develop an appropriate

product.

_______(signed)_______

Mary Alice Bjork

Administrator, Insurance Division

Department of Consumer and Business Services

Department of Consumer and Business Services

Insurance Division

350 Winter St. NE, Room 440

PO Box 14480

Salem, OR 97301-0405

(503) 947-7980

FAX (503) 378-4351

TTY (503) 947-7280

www.oregoninsurance.org