NJ Rate Increase Effective September 1

New Jersey Rate Increase of 5% Effective September 1, 2013

The New Jersey Land Title Insurance Rating Bureau made a filing in 2012 with the New Jersey Department of Banking and Insurance (”DOBI”) seeking an increase in the filed rated governing our business in the State of New Jersey, as compiled in the Rating Bureau’s Manual of Rates and Charges (”Rate Manual”).

DOBI has granted the title industry rate relief for all new orders for title insurance received on or after September 1, 2013, allowing “an overall 5.0% revenue increase.” This rate relief is embodied in (1) the Standard Underwriting Rate Schedule and (2) the schedule for Refinance, Recast or Substitution Loans. No other rate schedules or charges or fees are affected by this rate increase.

Below are the two amended schedules, with the former prices placed in [brackets] for your easy reference:

4.2 STANDARD UNDERWRITING RATE SCHEDULE

The standard underwriting rate for either owner’s insurance, leasehold insurance, or mortgage insurance, shall be calculated according to the following rate schedule:

                Policy Liability                                                            Rate per $1,000 or Fraction Thereof

$0-$100,000..............................[formerly $5.00]...........................................$5.25

$100,001-$500,000...................[formerly $3.95].......................................add $4.25

$500,001-$2 million.................[formerly $2.65]........................................add $2.75

Over $2 million.........................[no change].............................................add $2.00                                        

4.6.1 REFINANCE, RECAST OR SUBSTITUTION LOANS

When a refinance, recast or substitution loan is made to the same borrower on the same property, the following rates shall apply to so much of the new policy as represents the face amount of the mortgage or mortgages other than construction loans being refinanced:

                Policy Liability                                                              Rate per $1,000 or Fraction Thereof

$0-$100,000..............................[formerly $2.50]...........................................$2.75

$100,001-$500,000...................[formerly $2.25]......................................add $2.50

$500,001-$2 million.................[formerly $2.00].......................................add $2.25

Over $2 million.......................[formerly $1.50]........................................add $1.75

The rate to be applied to the liability assumed, if any, over and above that which is eligible for the refinance, recast or substitution loan rate set forth above, shall be calculated using the standard underwriting rate in the applicable bracket or brackets.

It is worth repeating that this rate increase applies only to new orders for title insurance received on or after September 1, 2013. Title orders already in process or received from a customer prior to and including August 31, 2013 are to be charged according to the April 1, 2013 Rate Manual.