The legislature has built more consumer protections into the state’s insurance laws. One part of the new law focuses on the growing problem of title insurance fraud. The bill adds several consumer protections to state laws governing operations of title insurance companies.
Senator Scott Rupp of Wentzville, who handled the bill in the senate says title insurance companies or their agents cannot co-mingle escrow moneys paid by clients with other funds, make sure the funds can be identified on an individual basis, and make sure the money remains the property of the client.
He says too many title insurance companies have used money that should have gone into escrow accounts to financially prop up other businesses.
Title insurance fraud has been a noticeable problem in the St. Louis area, where three major companies failed just last year. But supporters fear the problem will spread statewide because the temptation to take the money is so great.
(The bill is SB66)