FAQs for Professional Liability Insurance

Abstracters and title agents nationwide have long been troubled by recurring errors and omissions insurance problems due to abrupt market changes. Dramatic swings in prices and availability led the American Land Title Association (ALTA) to look for a better alternative that would bring long-term stability for title professionals seeking E&O coverage. After considering several different approaches, ALTA leaders decided that the most effective solution would be to create TIAC, an independent risk retention group wholly owned by members of the Association. TIAC issued its first policy in June of 1988 and has been continuing to insure more and more title professionals since that time.

Under the 1986 amendments to the Liability Risk Retention Act of 1981, a risk retention group is a special purpose insurance company owned solely by its policyholders. The group may write only liability insurance, including E&O coverage. Under the Act, TIAC is chartered and licensed in Vermont for the purpose of issuing title agents and abstracters E&O insurance nationwide.

Any active or associate member of ALTA may apply for E&O coverage from TIAC. TIAC gladly provides quotes to non-members as well. To purchase coverage, members must own stock in TIAC.

To insure with TIAC, an ALTA active or associate member is required by the federal law establishing risk retention groups to purchase stock in TIAC. Two classes of TIAC stock are offered and the purchase of either class satisfies the stock purchase requirement. Class A stock is priced at $1,000 per share with a minimum purchase requirement of 1.5 shares for every five professional employees or part thereof. Since there are no partial shares, the requisite number of shares must be rounded upward. Class A shareholders have full voting rights and may qualify to serve on TIAC’s Board of Directors. Class C stock is priced at $100 per share ($1 par value) and there is a one share purchase requirement, no matter the insured firm’s size. Class C stock has limited voting rights and Class C shareholders may not serve on the Board of Directors of TIAC. Class C stock may be redeemed for its $1 par value. For specific rules, rights and requirements, please refer to the Summary Business Plan and Disclosure Document, which is available upon request to the Underwriting Manager.

ALTA members may sell their TIAC stock if they decide not to purchase E&O coverage, leave the title industry, etc. Because TIAC is a risk retention group, members are in fact required to sell their stock should they be declined for coverage or decide not to purchase the E&O coverage for any reason.

No. Under the laws of the state of Vermont, the state in which TIAC is incorporated, stock in any corporation, including TIAC, is non-assessable.

Coverage is provided on a “claims made” basis and includes prior acts coverage for qualified insureds. TIAC’s policy insures professional services rendered as a title agent (including limited title opinion coverage), title abstracter, UCC searcher, corporate document searcher, public records searcher, flood zone certifier, escrow agent, closing agent, witness closer, and notary public. Coverages available to qualified insureds include:

• First Dollar (No Deductible) Defense Coverage
• Claims Expenses in Addition to the Limit of Liability
• Loss of Funds coverage/wire fraud
• Privacy Breach Mitigation Expenses
• Remote Online Notarization

TIAC offers flexible policy limits from $250,000 to $1,000,000 per claim and from $250,000 to $2,000,000 annual aggregate. Deductible options range from $1,000 to $50,000 or more. Higher limits are available to qualifying insureds. All limit and deductible options are subject to TIAC’s underwriting guidelines.

Premiums are based on a number of factors including:

• Number of professionals insured
• Annual gross income from covered title activities
• Policy limits and deductible selected
• Coverage selected
• Prior E&O loss experience
• Prior E&O insurance history

For a specific premium quotation, an application for insurance must be completed. For an application, please call us at 1-800-628-5136 or click here.

TIAC will issue a “claims made” policy that insures the named ALTA member company, as well as all of its principals, partners and employees. In the event of cancellation or non-renewal by the Insured or TIAC (except for non-payment of premium), a one year extended reporting endorsement may be purchased to cover claims reported during the extended reporting period arising from negligent acts, errors or omissions which occurred prior to the end of the policy period and otherwise covered by the policy. Full retroactive coverage is provided to eligible insureds for claims made during the policy period that arise from past negligent acts, errors or omissions if, on the effective date of the policy to be issued, no insured had any knowledge of such negligent act, error or omission.

As claims counsel, TIAC has retained one of the leading professional liability/errors and omissions insurance defense firms in the country in order to provide prompt, courteous and professional claims handling. TIAC’s claims counsel is the law firm of Dykema Gossett, PLLC.