OGC Op. No. 06-05-08

The Office of General Counsel issued the following opinion on May 16, 2006, representing the position of the New York State Insurance Department.

Re: Title Insurance Agent Corporation; Licensing Inquiry

Question Presented:

Must an agent or other representative of a New York State authorized title insurance corporation be licensed as an insurance agent to sell title insurance in New York State on behalf of the title insurance corporation?

Conclusion:

No. An agent or other representative of a New York State authorized title insurance corporation is not required to be licensed as an insurance agent to sell title insurance on behalf of a New York State authorized title insurance corporation.

Facts:

The inquirer's New York State corporation acts as a title insurance agent for two New York State authorized title insurance corporations.

Analysis:

N.Y. Ins. Law § 2101(a)(4) (McKinney Supp. 2006) excludes "any agent or other representative of any title insurance company" from the definition of insurance agent contained in N.Y. Ins. Law § 2101(a) (McKinney Supp. 2006). Thus, an agent or other representative of a New York State authorized title insurance corporation selling title insurance issued by such insurer is not required to be licensed as an insurance agent and would not be acting as an insurance producer¹ without a license under N.Y. Ins. Law § 2102(a)(1) (McKinney Supp. 2006).

Moreover, N.Y. Ins. Law § 2115(a) (McKinney Supp. 2006), which prohibits an insurer and its agent or other representative from paying a commission or other compensation to any person, firm, association or corporation for acting as an insurance agent in New York State except to a licensed insurance agent of such insurer or to a person described in N.Y. Ins. Law § 2101(a)(2) or (4) (McKinney Supp. 2006), is specifically not applicable to a title insurance company or its agent or representative pursuant to N.Y. Ins. Law § 2115(b) (McKinney Supp. 2006).

For further information please contact Senior Attorney Robert Freedman at the New York City Office.

¹ N.Y. Ins. Law § 2101(k) (McKinney Supp. 2006) defines "insurance producer" in N.Y. Ins. Law Article 21 (McKinney 2000 & Supp. 2006) to mean:  "an insurance agent, insurance broker, reinsurance intermediary, excess lines broker, or any other person required to be licensed under the laws of this state to sell, solicit or negotiate insurance.  Such term shall not include . . . (4) any agent or other representative of any title insurance company . . . ."