DC Title Producer Bond: A Comprehensive Guide
This guide provides information for insurance agents to help customers obtain a Washington DC Title Producer bond (also called a Title Insurance Producer bond).
*This page focuses exclusively on the $200,000 license bond required for title insurance producers operating in DC. Title insurance producers that are licensed as a business entity must also obtain a $200,000 Fidelity bond or similar insurance coverage. Contact BondExchange to obtain a Fidelity bond.
At a Glance:
- Lowest Cost: $750 per year or $75 per month
- Bond Amount: $200,000
- Who Needs It: All title insurance producers operating in DC
- Who Regulates Title Producers in DC: The DC Department of Insurance, Securities, and Banking (DISB)
- Purpose: To ensure insureds and/or the DISB receives compensation for financial harm if the title insurance producer fails to comply with licensing laws
Background
DC Code 31-5041.02 requires all title insurance producers operating in the state to obtain a license from the Department of Insurance, Securities, and Banking. The DC Council enacted the licensing requirement to ensure title insurance producers do not engage in unethical business practices. To provide financial security for enforcing licensing laws, title insurance producers must purchase and maintain a $200,000 surety bond to be eligible for licensure.
What Is the Purpose of a DC Title Producer Bond?
DC requires title insurance producers to purchase a surety bond as part of the application process to obtain a business license. The bond ensures that restitution is available to any damaged party should the title insurance producer fail to abide by the regulations outlined in the DC Code Title 31, Chapter 50B. Specifically, the bond protects claimants if the title insurance producer commits fraud or engages in unfair business practices. In short, the bond is a type of insurance that protects the public if the title insurance producer violates the terms of their license.
How Can an Insurance Agent Obtain a DC Title Producer Bond?
BondExchange makes obtaining a DC Title Producer bond easy. Simply log in to your account and use our keyword search to find the “title producer” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
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Is a Credit Check Required for the DC Title Producer Bond?
Surety companies will run a credit check on the title insurance producer to determine eligibility and pricing for the DC Title Producer bond. Producers with excellent credit and work experience can expect to receive the best rates. While producers with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the applicant’s credit.
How Much Does the DC Title Producer Bond Cost?
The DC Title Producer bond can cost between $750 to $12,000 per year or $75 to $1,200 per month. Insurance companies determine the rate based on several factors including your customer’s credit score and experience. The chart below offers a quick reference for the approximate bond cost on the $200,000 bond requirement.
$200,000 DC Title Producer Bond Cost
| Credit Score* | Bond Cost (1 Year) | Bond Cost (1 month) |
|---|---|---|
| 720+ | $750 | $75 |
| 680 – 719 | $900 | $90 |
| 660 – 679 | $1,400 | $140 |
| 649 – 659 | $2,000 | $200 |
| 629 – 648 | $3,000 | $300 |
| 600 – 628 | $5,000 | $500 |
| 580 – 599 | $7,000 | $700 |
| 550 – 579 | $8,000 | $800 |
| 525 – 549 | $10,000 | $1,000 |
| 500 – 524 | $12,000 | $1,200 |
*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.
How Does DC Define “Title Producer”?
To paraphrase DC Code 31-5041.01, a title insurance producer is an individual or business entity that performs acts on behalf of a title insurer, such as determining the insurability of a client and soliciting or negotiating title insurance coverage on behalf of a title insurer.
Exemptions to this definition include:
- Financial institutions that do not solicit, procure, or negotiate title insurance contracts
- Employees of abstracting companies
- Businesses that are limited to advertising title insurance without the intent to solicit insurance
- Title insurance business employees who counsel or advise employers on relative insurance interests without the intent to sell, solicit, receive a commission, or negotiate an insurance policy
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How Do Title Insurance Producers Apply for a License in DC?
Title insurance producers must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the Department of Insurance, Securities, and Banking’s General Information webpage for specific details on the process.
License Period – The DC Title Insurance Producer License expires biennially on the last day of the individual’s birth month or on May 31st if the licensee is a business entity.
Step 1 – Pass the Exam
Resident title insurance producers are required to pass a pre-licensure exam (non-resident applicants can be granted a license through reciprocity). To schedule an exam, applicants must contact Pearson VUE.
Step 2 – Purchase a Surety Bond
Title insurance producers must purchase and maintain a $200,000 surety bond. Title insurance producer companies must also purchase a $200,000 Fidelity bond or another similar form of insurance.
Step 3 – Purchase Insurance
Applicants must purchase errors and omissions (E&O) insurance with a limit of at least $500,000.
Step 4 – Complete the Application
Applications for a title insurance producer license must be completed through the National Insurance Producer Registry (NIPR). Along with the application, a finalized Title Financial Responsibility Certificate is required. This form verifies proof of the applicant holding an errors and omissions policy for $500,000, a Fidelity bond in the amount of $200,000, and a $200,000 surety bond.
How Do DC Title Producers Renew Their License?
Title insurance producers can renew their licenses online through the NIPR website. Initial licenses are issued for a minimum of 18 months to a maximum of 29 months and expire on the last day of the applicant’s birth month. Title insurance producer agency/firm licenses expire biennially on May 31st.
Licensees must renew their licenses within 30 days of the expiration date or be subject to late fees and/or a reinstatement process.
What Are the Insurance Requirements for Title Producers in DC?
According to the DC Code 31-5041.02 (1A), title insurance producers are required to obtain a $200,000 business license surety bond, E&O coverage in an amount no less than $500,000, and a $200,000 Fidelity bond or other similar coverage.
How Do DC Title Producers File Their Bonds?
Title insurance producers should submit their completed bond forms, including the power of attorney, electronically when submitting their license applications to the National Insurance Producer Registry. The surety bond requires signatures from the surety company, as well as the title insurance producer. The surety company should include the following information on the bond form:
- The legal name of the individual buying the bond
- Surety company’s name
- Address and phone number of the surety company
- License type (title producer)
- Date the bond is signed
What Can DC Title Producers Do to Avoid a Claim Against Their Surety Bond?
The best way to avoid a bond claim as a title insurance producer is to simply comply with state license laws. This includes ensuring fair business practices are followed when soliciting and negotiating title insurance coverage for the public. For example, bribing a potential client with any sort of rebate or discount to the premium stated in a policy of insurance is a license violation and is subject to a bond claim.
What Other Insurance Products Can Agents Offer Title Producers in DC?
The DC Department of Insurance, Securities, and Banking requires title insurance producers to purchase coverage for a $500,000 E&O policy, which is just another name for professional liability insurance. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for DC Title Producer Customers?
The DISB conveniently provides a public database to search for active title insurance producers in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.