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F I S C A L I M P A C T R E P O R T

SPONSOR Stewart

ORIGINAL DATE

LAST UPDATED

3/16/07

HM 80

SHORT TITLE Study Real Estate Title Insurance Industry

SB

ANALYST Earnest

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

SUMMARY

Synopsis of Bill

House Memorial 80 requests that the Public Regulation Commission undertake a review of laws

regarding title insurance in New Mexico and to make recommendations for better protection to

property owners by title insurance and actions that may be taken to increase the understanding

and awareness of property owners regarding title insurance.

The memorial requests that PRC report to the appropriate interim legislative committee by

October 30, 2007.

SIGNIFICANT ISSUES

The PRC has undertaken an internal review of title insurance rate setting. This request might fit

well with that study.

The memorial states the Legislature finds that:

•

the intent of the legislature in enacting the New Mexico Title Insurance Law was, in part,

that the business of title insurance be totally regulated by the state to provide for the

protection of consumers and purchasers of title insurance policies;

House Memorial 80 – Page

2

•

the New Mexico Title Insurance Law was enacted more than twenty years ago in 1985;

•

the Title Insurance Guaranty Act was enacted in 1999 by Laws 1999, Chapter 60;

•

Laws 1999, Chapter 60 also amended the New Mexico Title Insurance Law by limiting

the duties of title insurers only to title insurers;

•

concern has arisen that a property owner's remedies arising from defects in title have

been unreasonably limited by the 1999 amendment to Section 59A-30-11 NMSA 1978;

•

concern has arisen that property owners may have an inadequate understanding of the

benefits to purchasers of real property of title insurance policies; and

•

concern has arisen about requirements of some lenders that a property owner purchase a

new title insurance policy when refinancing property already owned by that property

owner.

BE/mt