40-1139. Same; financial responsibility requirements.
40-1139
40-1139. Same; financial responsibilityrequirements.(a) The title insurance agent who handles escrow, settlementorclosing accounts shall file with the commissioner a surety bond or irrevocableletter of credit in a form acceptable to the commissioner, issued by aninsurance company or financial institution authorized to conduct business inthis state, securing the applicant's or the title insurance agent's faithfulperformance of all duties and obligations set out in K.S.A. 40-1135through 40-1141 andamendments thereto.
(b) The terms of the bond or irrevocable letter of credit shall be:
(1) The surety bond shall provide that such bond may not be terminatedwithout 30days prior written notice to the commissioner.
(2) An irrevocable letter of credit shall be issued by a bank which isinsured by the federal deposit insurance corporation or its successor if suchletterof credit is initially issued for a term of at least one year and by its termsis automatically renewed at each expiration date for at least an additionalone-year term unless at least 30 days prior written notice of intention not torenew is given to the commissioner of insurance.
(c) The amount of the surety bond or irrevocable letter of credit for thoseagents servicing real estate transactions on property located in countieshaving a certain population shall be required as follows:
(1) $100,000 surety bond or irrevocable letter of credit in counties having apopulation of 40,001 and over;
(2) $50,000 surety bond or irrevocable letter of credit in counties having apopulation of 20,001 to 40,000; and
(3) $25,000 surety bond or irrevocable letter of credit in counties havinga population of 20,000 or under.
(d) The surety bond or irrevocable letter of credit shall be for the benefitof any person suffering a loss if the title insurance agent converts ormisappropriates money received or held in escrow, deposit or trust accountswhile acting as a title insurance agent providing any escrow or settlementservices.
History: L. 1999, ch. 95, § 12; July 1.