Appellate Court Limits Title Insurance Wining and Dining
The Department of Financial Services new rules, Insurance Regulation 208, have been reinstated.
NEW YORK CITY—A state appellate court has reinstated a regulation of the title insurance industry that prohibits insurers from offering tickets, event outings, drinks and dinners where there is no expectation that the receiver intents to purchase insurance.
A recent article written by Andrew Denny at GlobeSt.com’s sister publication, ALM’s New York Law Journal, explained the court’s decision. The Appellate Division, First Department reversed a lower court judge’s order which had annulled Insurance Regulation 208 as arbitrary and capricious. This puts the new rules back in place. Denny explains that the regs stop title insurance employees from wining and dining professionals like attorneys and real estate agents in exchange for business—then passing such costs onto customers.
The Department of Financial Services established these rules. The DFS superintendent has said the practice had inflated insurance premiums.
Read the full article on the New York Law Journal website.