TITLE INSURANCE RATES 

What are the Current Title Insurance Issue and Re-Issue Rates? When am I entitled to a Discount?

The Office of Insurance Regulation sets rates for title insurance premiums, called the “promulgated rate”; title insurance agents charge at least the minimum promulgated rate when issuing title insurance policies. To determine the promulgated rate, the Office takes into account underlying risks and, further, the various costs associated with underwriters’ issuance of title insurance policies (i.e. administrative surcharges, annual licensing fees and taxes paid to the state on the gross amount of premiums sold). The “regular title insurance premium” that is charged to you consists of the promulgated rate, as well as charges for related title services (e.g. preparing title information and other documents and conducting the closing for the real estate transaction, in which the title insurance binder, commitment or policy is issued).

The Office has required that your title insurance agent break the regular title insurance premium down into its constituent parts (promulgated rate, title search charges, examination fees and closing charges) on your disclosure documents. The Office hopes that you will thus be better informed as to the cost of title insurance, and, further, that it will be better able to monitor practices within the industry to ensure that title insurance agents and underwriters are not compromising the promulgated rate.

In Florida, your promulgated rate is calculated primarily in accordance with your property’s insurable value. If you obtain a title insurance policy pursuant to your purchase of property, the rate is determined by the purchase price of the property. If, however, a title insurance policy was recently taken out on your property – or if you obtain the policy pursuant to a mortgage refinance, which refers to the process of replacing your existing debt obligation with another bearing different terms – you may be entitled to a discounted “reissue rate”.

(Remember, however, that a non-lawyer title insurance agent is not obligated to acknowledge your qualification for this reissue rate/ credit, while a title insurance attorney will owe you a fiduciary duty to fully disclose this and other such benefits.)

Florida Title Insurance Premium Calculation

To calculate the promulgated rate for your owner’s title insurance premium, which is the absolute minimum that your title insurance underwriter can charge you if you do not qualify for a reissue credit as noted above, use the following table:

Purchase Price > Title Insurance Cost Per Thousand $

$0 – $100,000 > $5.75

$100,000 – $1 million > add $5.00

$1 million – $5 million > add $2.50

$5 million – $10 million > add $2.25

Over $10 million > add $2.00

 

To calculate the promulgated rate for the reissuance of an owner’s title insurance policy, which is the absolute minimum that your title insurance underwriter can charge you if you qualify for a reissue credit as noted above, use the following table:

Purchase Price > Title Insurance Cost Per Thousand $

$0 – $100,000 > $3.30

$100,000 – $1 million > add $3.00

$1 million – $10 million > add $2.00

Over $10 million > add $1.50

Hypothetical: Say you have contracted to purchase a home for $110,000.00. To calculate the promulgated rate for your property’s basic title insurance premium, you would use the first table listed above and engage in the following two steps: (1) Multiply $5.75 by 100 to arrive at the rate to be charged for the first $100,000.00 of your property’s value, for a total of $575.00. (2) Multiply $5.00 by 10 to arrive at the rate to be charged for the remaining $10,000.00 of your property’s value, for a total of $50.00. Add both values to determine the promulgated rate for your property’s basic title insurance premium, which comes to $625.00. Note: If you are obtaining title insurance pursuant to, for example, an attempt to refinance a mortgage on your property, and you meet the remaining requirements for a reissue credit, you would use the second table listed above, and engage in the aforementioned two steps to arrive at the promulgated rate for your property’s “reissue” title insurance premium.

Remember, however, that the promulgated rate is generally the rate your title insurance underwriter will charge you to insure the title to your property. The promulgated rate is only ONE component of the regular title insurance premium you will pay for your title insurance policy. Which additional fees will apply will depend on the underwriter and title agent you select.

When does a homebuyer qualify for a Reissue Credit?

Simply stated, a homebuyer will qualify for a reissue credit if he/she is obtaining a title insurance policy for property for which a title insurance policy was only recently purchased and which has not since been improved (i.e. undergone construction, etc.).

To be more specific, however, the following criteria must be met to qualify for a reissue credit:

FIRST, an owner’s title insurance policy for the property must have been issued previously to insure either the seller or the borrower in the current transaction; and

SECOND, the property must not have been improved since the original policy date, except for roads, bridges, drainage facilities or utilities; or, the original policy date must be less than three years prior to the reissue date; or, the new policy must be a mortgagee’s policy issued upon the refinancing of property for which the current mortgagor had previously obtained an owner’s policy.

 

Title Insurance Reissue Rates

The Florida Administrative Code sets the premium for title insurance policies issued within 3 years of a previous policy (for sales/purchase) at:

$0 – $100,000 > $3.30

$100,000 – $1 million > add $3.00

$1 million – $10 million > add $2.00

Over $10 million > add $1.50

In order to qualify for these rates, the title agent must include proof of the previous title insurance policy. Failure to include the proof of prior coverage within 3 years could result in the title insurance agent and agency being found to have violated Subsection 627.780(1), Florida Statutes, for quoting, charging, collecting or accepting a premium for title insurance that is other than the premium implemented by the Florida Administrative Code.

For a refinance the policy never expires for a discount.

Substitution Loan Rates

 

The following risk premium for substitution loans shall apply:

(a) When the same borrower and the same lender make a substitution loan on the same property, the title to which was insured by an insurer in connection with the original loan.

 

Age of Original Loan Premium Rates

3 years or under >> 30% of original rates

From 3 to 4 years >> 40% of original rates

From 4 to 5 years >> 50% of original rates

From 5 to 10 years >> 60% of original rates

Over 10 years >> 100% of original rates

Minimum premium is $100.00

 

(b) At the time a substitution loan is made, the unpaid principal balance of the previous loan will be considered the amount of insurance in force on which the foregoing rates shall be calculated. To these rates shall be added the regular rates in the applicable schedules for any new insurance, that is, the difference between the unpaid principal balance of the original loan and the amount of the new loan.

(c) In the case of a substitution loan of $250,000 or more, when the same borrower and any lender make a substitution loan on the same property, the title to which was insured by an insurer in connection with the previous loan, the premium for such substitution loans shall be the rates as set forth in paragraphs (a) and (b).

  

Who pays for title insurance at closing in Florida?

In Florida, the person responsible for paying title varies per county and can be negotiated in the contract. In most counties, the seller generally pays for the title insurance and chooses the title company.

However, the buyer generally pays for title insurance and chooses the title company in the following counties:

  • Sarasota County

  • Collier County

  • Miami-Dade County

  • Broward County

Who chooses the title company in Florida?

Most buyers and sellers are indifferent about title insurance companies, while many real estate agents or lenders have an existing relationship with a specific title company they prefer to work with. What many homebuyers don't realize is that the title insurance company they work with can have a huge impact on their closing experience!

Choosing the right title insurance company like PRONTO TITLES can lead to:

  • A stress-free closing experience

  • Closing on-time without delays

  • Not having any title issues after closing

  • More affordable title insurance and closing costs

  • Peace of mind that your home will be secure for years to come

  • And much more...

Who has the right to make the ultimate choice?

The person responsible for choosing the title insurance company is typically the person who pays for the Owner’s Title Insurance Policy (read above). That said, the party not paying for the Owner’s Title Insurance Policy can make a counteroffer that includes a new proposed title company if they’re passionate about using a specific closing firm.

Since the seller customarily pays for the new Owner’s Title Insurance Policy in many counties in Florida, it should give them the right to select the title company. The only caveat would be that, in this case, a buyer would be forced to use the title company the seller chooses, and that title company may not provide good customer service or "closing experience." In Miami-Dade, Broward, Sarasota and Collier counties, where the buyer customarily pays for and chooses the title insurance company, this may not be an issue.

TITLE TRANSFERS

Is Title Insurance transferable?

No. Title insurance is never transferable when the ownership of property changes, and it similarly can’t be assumed by a new owner. In fact, a title insurance policy itself terminates when the legal title on property changes.

How do you transfer a Title-Deed in Florida?

Transferring a title in Florida is quite simple assuming the title is unencumbered, meaning there are no competing claims or liens on the property. In these cases, a simple Quitclaim Deed could be used to transfer the title of the property to the new owner.

Although a Quitclaim Deed can be a quick solution, a Warranty Deed and Title Insurance are always recommended due to Florida having so many probates, unauthorized title transfers and title fraud.

What is the cost of Title-Deed transfer in Florida?

The fees related to title transfer in Florida are actually called “documentary tax stamp rates,” and they’re included in closing costs — typically paid by the seller, though this is negotiable. The documentary tax stamp rates are uniform throughout the state with one exception: Miami-Dade County.

The tax in most Florida counties is $0.70 for every $100 of the home’s purchase price, which is also known as the deed’s consideration. In Miami-Dade, that rate drops to $0.60 per $100. For example, if you purchase a home through most of Florida for $250,000, the documentary tax stamp rates will be $1750. If you purchase a home in Miami-Dade for the same price, the documentary tax stamp rates will be $1500.