Title Agency ($35,000) Bond - Statewide in Florida

Brief Summary

Two things about this bond are commonly stated wrong. The obligee is not the State of Florida. F.S. 626.8419 requires the surety bond to be made payable to the title insurer or title insurers appointing the agency, for the benefit of any appointing insurer damaged by the agency violating its contract with that insurer. And $35,000 is a floor, not a set amount, since the statute says at least $35,000 and the appointing insurer decides what it will accept. It is also only one of three instruments. Appointment also requires a fidelity bond of at least $50,000 and errors and omissions insurance of at least $250,000 per claim.

Before a Florida title insurer appoints a title insurance agency, the insurer files an application with the Department of Financial Services certifying that the agency has obtained a surety bond of at least $35,000 made payable to the appointing title insurer or insurers, a fidelity bond of at least $50,000, and errors and omissions insurance of at least $250,000 per claim with a deductible no greater than $10,000. The surety bond must remain in effect and unimpaired for as long as the agency holds an appointment.

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How to Apply for a Title Agency ($35,000) Bond:

• Obtain a surety bond of at least $35,000 made payable to the title insurer or title insurers appointing the agency
• Make sure the bond names every appointing insurer and provides that each is notified of a claim or termination
• Obtain a fidelity bond of at least $50,000 acceptable to the appointing insurer
• Obtain errors and omissions insurance of at least $250,000 per claim and an aggregate limit, with a deductible no greater than $10,000
• Do not accept a bond provided directly or indirectly by a title insurer, which the statute prohibits
• Hold a title insurance agency license through MyProfile and designate a licensed title agent or Florida Bar attorney as agent in charge
• Have each appointing title insurer file the appointment application with the Department of Financial Services
• Provide written proof annually to each appointing insurer that the bond is still in effect and unimpaired
• Pay the $200 administrative surcharge by the end of January each year
• Submit annual title insurance data by May 31

Detailed Information About the Florida Title Agency ($35,000) Bond:

What the statute actually requires

F.S. 626.8419 lists the conditions the appointing insurer must certify.

• A fidelity bond of at least $50,000, acceptable to the insurer appointing the agency
• Errors and omissions insurance acceptable to the appointing insurer, at least $250,000 per claim and an aggregate limit, with a deductible no greater than $10,000
• A surety bond of at least $35,000 made payable to the title insurer or title insurers appointing the agency

All three are separate. None substitutes for another, and the $50,000 fidelity bond is the piece most applicants forget when they price out the $35,000 surety bond alone. If a fidelity bond or errors and omissions insurance is unavailable generally, the department is directed to adopt rules for alternative methods of compliance.

Who the bond protects

The appointing title insurer, not the consumer directly. The surety bond is for the benefit of any appointing title insurer damaged by a violation by the agency of its contract with that insurer. If the bond is payable to more than one title insurer, it must provide that each insurer is notified when a claim is made on the bond or when the bond is terminated. That notice clause is a drafting requirement, so check that your bond form carries it before filing with a second or third insurer.

Two clauses that shape the paperwork

The bond must remain in effect and unimpaired as long as the agency is appointed by a title insurer, and the agency must provide written proof to each appointing insurer on an annual basis that the bond is still in effect and unimpaired. Unimpaired matters. A partial claim payment that reduces the penal sum has to be restored rather than left short.

A title insurer may not provide the surety bond directly or indirectly on behalf of the agency. The insurer being protected cannot fund the protection.

Who is exempt from the license, and who is not

Under F.S. 626.8417, title insurers acting through designated corporate officers, and attorneys duly admitted to practice in Florida and in good standing with The Florida Bar, are exempt from the chapter's title insurance licensing provisions. The limit is the part that catches people. If an attorney owns a title insurance agency that operates separately from the law practice, that agency must be licensed and appointed as a title insurance agent, which brings the bond, the fidelity bond and the errors and omissions coverage with it.

Section 626.8419 also states that it does not exempt title insurance agents from the appointment requirements of part I, so agency appointment does not cover the individual agents.

Prerequisites that do not replace the bond

Agent licensure requires a 40 hour title insurance course including 3 hours of ethics completed within the preceding 4 years, or 12 months of supervised experience, plus the required examinations, with prelicensure coursework waived for members of the armed forces, veterans and their spouses. Education satisfies licensure, not the bond.

Ongoing obligations

The Department of Financial Services requires the agency to hold a title insurance agency license through MyProfile, designate a licensed title agent or Florida Bar attorney as agent in charge, and receive appointment from title insurance companies before transacting business. There is a $200 administrative surcharge due by the end of January every year, and annual title insurance data is submitted by May 31.

Eligibility and Requirements for a Florida Title Agency ($35,000) Bond:

• Surety bond of at least $35,000, which is a statutory minimum rather than a fixed amount
• The appointing title insurer or insurers as obligee, not the state
• Bond conditioned for the benefit of any appointing insurer damaged by the agency violating its contract
• Notice to each named insurer when a claim is made or the bond is terminated
• Bond in effect and unimpaired for as long as any appointment is held
• Agency name on the bond matching the licensed agency name exactly
• Owner credit review, which shapes the rate rather than eligibility for most applicants at this bond size

Florida Title Agency ($35,000) Bond FAQs:

Official and Additional Resources for the Florida Title Agency ($35,000) Bond: