Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a Kansas Title Agent: Escrow, Settlement, or Closing Accounts bond.
At a Glance:
- Lowest Cost: $94 per year or $9 a month
- Bond Amount: Determined on a case-by-case basis (more on this later)
- Who Needs It: All individual title insurance agents and title insurance agencies that handle escrow, settlement, or closing accounts in Kansas
- Purpose: To protect the public from financial harm if the title insurance agent or agency commits fraud or engages in unfair business practices
- Who Regulates Title Agents in Kansas: The Kansas Insurance Department
Background
Kansas Statute 40-1139 requires all individual title insurance agents and title insurance agencies operating in the state to obtain a license from the Kansas Insurance Department. The Kansas Legislature enacted the licensing requirement to ensure that title insurance agents and agencies do not engage in unethical business practices. To provide financial security for the enforcement of the licensing law, individual title insurance agents and title insurance agencies that handle escrow, settlement, or closing accounts in Kansas must purchase and maintain a surety bond to be eligible for licensure.
What Is the Purpose of the Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond?
Kansas requires all individual title insurance agents and title insurance agencies that handle escrow, settlement, or closing accounts to purchase a surety bond as part of the application process to obtain a license. The bond ensures that restitution is available to any damaged party should the title insurance agent or agency fail to abide by the regulations outlined in the Kansas Statutes Chapter, 40 Article 11. Specifically, the bond protects claimants if the title insurance agent or agency 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 agent or agency violates the terms of their license.
How Can an Insurance Agent Obtain a Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond?
BondExchange makes obtaining a Kansas Title Agent: Escrow, Settlement, or Closing Accounts bond easy. Simply log in to your account and use our keyword search to find the “title agent” bond in our database. Don’t have a login? Enroll now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
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How Is the Bond Amount Determined?
The Kansas Title Agent: Escrow, Settlement, or Closing Accounts bond amount depends upon the population in which the property is located where escrow, settlement, or closing services are provided by the title insurance agent/agency. See the following for further details:
- $25,000 surety bond in counties having a population of 20,000 or under
- $50,000 surety bond in counties having a population of 20,001 to 40,000
- $100,000 surety bond in counties having a population of 40,001 and over
Is a Credit Check Required for the Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond?
Surety companies will run a credit check on the title insurance agent or agency to determine eligibility and pricing for the Kansas Title Agent: Escrow, Settlement, or Closing Accounts bond. Title agents/agencies with excellent credit and work experience can expect to receive the best rates. Title agents/agencies with poor credit may be declined by some surety companies or have to 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 Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond Cost?
The Kansas Title Agent: Escrow, Settlement, or Closing Accounts bond can cost between 0.5% to 5% of the bond amount per year. Monthly subscription options are also available. Insurance companies determine the rate based on several factors including your customer’s credit score and experience. The chart below briefly references the approximate bond cost on the $25,000 bond requirement.
$25,000 Kansas Title Agent: Escrow, Settlement, or Closing Accounts Bond Cost
| Credit Score* | Bond Cost (1 Year) | Bond Cost (1 month) |
|---|---|---|
| 720+ | $94 | $10 |
| 680 – 719 | $113 | $12 |
| 660 – 679 | $175 | $18 |
| 649 – 659 | $250 | $25 |
| 629 – 648 | $375 | $38 |
| 600 – 628 | $625 | $63 |
| 580 – 599 | $875 | $88 |
| 550 – 579 | $1,000 | $100 |
| 525 – 549 | $1,250 | $125 |
| 500 – 524 | $1,500 | $150 |
*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 Kansas Define “Title Insurance Agent/Agency”?
To paraphrase Kansas Statute 40-1136, a title insurance agent or title insurance is a business that performs various tasks such as determining the insurability of a client, handling escrows, negotiating title insurance policies, or closing real estate transactions.
To be clear, only individual title insurance agents and title insurance agencies that handle escrow, settlement, or closing accounts are required to purchase and maintain a surety bond. If a title insurance agent/agency is not handling escrow, settlement, or closing accounts, the agent/agency must submit a letter to the Kansas Insurance Department stating they will not be performing those services. The letter must be submitted via email to [email protected] with “Title” in the subject line.
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 Agents/Agencies Become Licensed in Kansas?
Title insurance agents and title insurance agencies in Kansas must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the Department’s Title Company, Agency, and Agent Requirements webpage for details on the process.
License Period – According to the Kansas Insurance Department, title insurance agents and title insurance agencies must renew their licenses on or before their biennial due date.
Step 1 – Purchase a Surety Bond
All individual title insurance agents and title insurance agencies that handle escrow, settlement, or closing accounts in Kansas must purchase and maintain a surety bond.
Step 2 – Satisfy the Following Requirements
To apply for a license, applicants must complete the requirements listed below:
- Your business entity must be organized as a corporation, partnership, limited liability company, limited liability partnership, or sole proprietorship. If applicable, register your business entity with the Kansas Secretary of State’s office
- Submit the NAIC Uniform Application for Business Entity License online via the National Insurance Producer Registry (NIPR).
- FEIN Verification: Submit to the Department a document issued by the IRS on IRS letterhead which displays the business entity name and the FEIN
How Do Title Insurance Agents/Agencies in Kansas Renew Their Licenses?
Title insurance agents and title insurance agencies must renew their licenses with the Kansas Department of Insurance on or before their biennial due date. The biennial due date is the last day of the original month in which the entity was issued its license, in an even or odd year, depending on whether the license was originally issued in an even or odd year. You can find your business entity’s biennial renewal date via the NAIC Lookup Search tool.
What Are the Insurance Requirements for Title Insurance Agents/Agencies in Kansas?
Kansas does not require title insurance agents or title insurance agencies to purchase any form of liability insurance as a prerequisite to obtaining a license. Title insurance agents/agencies must purchase and maintain a surety bond.
How Do Title Insurance Agents/Agencies File Their Bonds in Kansas?
Title insurance agents and agencies should submit their completed bond forms, including the power of attorney, to the Kansas Insurance Department (see the mailing address listed below).
Kansas Insurance Department
Attn: Producer Licensing Division
1300 Arrowhead Road
Topeka, KS 66604
The surety bond requires signatures from the surety company, as well as the title insurance agent or a representative from the title insurance agency. 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
- Date the bond is signed
What Can Title Insurance Agents/Agencies Do to Avoid a Claim Against Their Surety Bond?
The best way to avoid a bond claim as a title insurance agent or title insurance agency is to simply comply with state license laws. This includes performing each escrow, settlement, or account closing honestly. For example, acting without consent from a customer is a blatant breach of contract and is subject to a bond claim.
What Other Insurance Products Can Agents Offer Title Insurance Agents/Agencies in Kansas?
Most reputable title insurance agents and title insurance agencies will purchase business liability insurance. Bonds are our only business at BondExchange, so we do not issue any other types of 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 Title Insurance Agents/Agency Customers in Kansas?
Kansas conveniently provides a public database to search for active title insurance agents and title insurance agencies 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.