Bulletin: NY000538

The Title Insurance Rate Service Association (TIRSA) has advised Stewart Title Insurance Company that the New York State Department of Financial Services (NYSDFS) has required all title insurance underwriters operating in New York State to collect income and expense data for 2013 from their independent agents.  The information is due by April 30, 2014.  The NYSDFS has directed that the information contained in the Schedule U-4, be collected from independent Agents for the period of January 1, 2013 through December 31, 2013. If you represent multiple underwriters you will receive a similar request for data from your other underwriters and will be required to complete the U-4 schedule for each underwriter. 

At Stewart, we wish to alert you to the data the NYSDFS is requesting from you, to allow you to gather the data within the time frames set forth by the NYSDFS. Stewart has created https://nydatacall.com.  This web site is operational. This web site will afford you a secure, confidential and efficient method to provide the requested data to TIRSA/NYSDFS. The secure web site will mirror the NYSDFS request for data in schedule U-4.  All individual office information will be kept strictly confidential and only the aggregate of all lines on the U-4 will be reported to TIRSA for their report to the NYDFS. 

To assist you in the collection of the data, Stewart has created a secure web site. The website is https://nydatacall.com, which is online and operational. 

To access the site you must use Internet Explorer and direct your browser to https://nydatacall.com.  The process to complete this data call is as follows:

• Hit Login on the page https://nydatacall.com
• Username is your six digit Agent ID
• Password is your six digit Agent ID
• The first time you log on it requests you change your password:
• • Current password is your six digit Agent ID
  • New Password – any password you like
  • Confirm new password – type new password again
  • Hit Continue
• Company Verification – You can edit address, phone, fax and website data but not Agent ID or Company Name
• Personal Verification – Enter the name, etc. of the person filling out the form
• Read the introduction and FAQ
• Begin Entering Data

Additional Information:

• If you cannot complete the questionnaire in one sitting, you can close Internet Explorer and access the site later.  Some things to remember:
• • Your new password to access the site
  • The data is saved up to the point you hit the “next” button so if you want to leave a screen and have already inputted data in that screen, make sure to hit next so that the system saves the data
• If you have questions on the line item you can hit the text “Help” on the upper right hand side and scroll to the Line Item number in question. 
• Once you submit the data you cannot edit the form.
• You can print out a worksheet to save.
• The final work sheet will list the data in all three parts to the submission. 

Remittance Data:

To further assist you in the collection of the data as required by the NYSID, Stewart will provide, on the web site, your 2013 remittance data.  This data will be limited to the last remittance submitted for policy dates in 2013 and will consist of total policy premium and endorsement premium remitted for polices made in 2013.  The data will also include a policy count.  All the data will be broken down by zone.  To the extent that you have not remitted on 2013 policies, this information will not be complete. 

The data needs to be completed by APRIL 30, 2014

We understand that you may not keep track of your expenses by individual underwriter, except for the amount of premium remitted.  You are to distribute all expenses allocated to New York among your underwriters in proportion to the dollars of premium you retain.  You are to report premium remitted as actually remitted to each underwriter.

INSTRUCTIONS FOR COMPLETION

The reporting Schedule is set forth in the separate work sheets provided on the web site.

NOTE THAT THERE ARE THREE PARTS TO THE SUBMISSION.

Instructions for completing all three parts are provided below.

Part 1 Instructions 

Enter amounts on each line as follows:

INCOME SECTION

Line 1 -          Policy Charges - Report premiums from policies priced under manual rates excluding endorsement premiums.

Line 2 -          Endorsements - Report all endorsement premiums

Line 3 -          Special Charges - Include charges for:
   Special Risks - Affirmative Coverage
   Affirmative Covenant Insurance - Existing Construction
   Construction Loan Continuation Searches beyond 5
   Commercial Contract Vendee Continuation Searches beyond 5
   Option Insurance Continuation Searches
   Mortgage Foreclosure Guarantees
   Recorded Document Certificates with Open Order
   Recorded Document Certificates with No Open Order

Line 4 -          Gross Title Insurance Charges - Sum of Lines 1, 2 and 3

Line 5 -          Amount Remitted to Underwriter - Report the amount of premium remitted to the underwriter covered by this report.  If you write for more than one underwriter, do not report the total remitted to all underwriters.  The total must be broken down so that the amount remitted to each underwriter is reported only on the report for that underwriter.

Line 6 -          Retained Title Insurance Charges - Line 4 less Line 5

EXPENSE SECTION 

Note that this year we have eliminated the distinction between title order processing and general administration.  We are requesting that data for both categories be combined and reported in the Total column for each zone.

We understand that some agents do not keep track of all of their expenses according to the categories identified below.  If you do not maintain separate accounting for these categories, we ask that you allocate expenses between these categories using your best professional judgment.

Line 7 -          Search & Exam Costs Paid To Independent Searchers - includes payments to non-employees for abstracts, title reports, chain of title documents, etc.

Line 8 -          Purchase of Copies of Public Record - includes payments to government entities for paper copies of deeds, mortgages, judgments, etc.; fees to government entities for online access to databases such as real estate tax records, etc.  Do not include fees paid to private data providers, which are reported on line 18.

Line 9 -          Salaries - Include:
   Salaries of both full-time and part-time personnel.
   Compensation paid on an hourly basis
   Bonuses
   Sales Commissions
   Contract Labor Expenses
   Partnership draws (if organized as a partnership)

Note: agents conducting business in multiple states are required to make a reasonable allocation of salaries for title insurance operations in New York State, as described above.  Similar allocations need to be made for agents that are part of a law firm or have multiple underwriters.

Line 10 -        Employee Benefits include group insurance (life, health, dental, disability, etc.), company contributions to profit-sharing plans, company contributions to 401(k) plans, etc.

Line 11 -        Payroll Taxes include city, state and Federal levies on payroll (including company portion of Social Security, Medicare, unemployment, etc.)

Line 12 -        Rent and Rent Items includes all utilities (i.e., heat, light, power, water), rental of main office, branch offices, and other offices; non-rental payments under net leases (utilities, taxes, etc.); maintenance expenses (janitorial supplies and services, repairs, etc.), etc.

Line 13 -        Real Estate Expenses include expenses for real estate your agency owns, such as janitorial services, real property insurance, interest on mortgage loans, etc.

Line 14 -        Real Estate Taxes include real estate taxes for real estate your agency owns.

Line 15 -        Taxes, Licenses, and Fees include non-real-estate-related and non-payroll taxes EXCLUDING state and Federal income taxes.

Line 16 -        Advertising includes advertising space purchased in Yellow Pages, advertising spots purchased on radio and television, billboards, advertising space purchased in trade or popular newspapers and magazines, etc.  Additional details for this expense category are to be provided on Part 2.  The total amount for this expense category on Part 2 must agree to the amount reported on Part 1.

Line 17 -        Marketing and Promotional Expenses include the cost of pens, pads, calendars, and similar materials distributed to customers; costs for providing training seminars; event sponsorships; costs of maintaining a website; costs of telemarketers; cost of newsletters and other marketing materials distributed to customers; etc.  Additional details for this expense category are to be provided on Part 2.  The total amount for this expense category on Part 2 must agree to the amount reported on Part 1.

Line 18 -        Title Plant Maintenance and Rental includes the costs of maintenance of any daily takeoff title or abstract plant and/or back title plant; and payments for the right to access another company’s title or abstract plant, back title files, and copies of the public record that are obtained from a private company.

Line 19 -        Travel includes cost of tickets for public transportation, including trains and airlines; all automobile expenses paid including cost of automobile lease or rental; depreciation of owned automobiles; cost of hotels and meals; etc.  Only expenses relating to employees or officers are to be reported on line 19.  Additional details for this expense category are to be provided on Part 2.  The total amount for this expense category on Part 2 must agree to the amount reported on Part 1.

Line 20 -        Printing and Office Supplies including copier expenses.

Line 21 -        Postage, Telephone and Freight includes cost of stamps, local and long-distance telephone service, leased dedicated telephone lines (such as T1 or T3 lines), internet services, Federal Express, UPS, etc.

Line 22 -        Equipment Depreciation and Rental (Non-EDP) includes rental or depreciation charges for furniture, copiers, fax machines, telecommunications equipment, and other non-computer office equipment;

Line 23 -        Cost or Depreciation of EDP Equipment and Software includes cost of leasing or depreciation charges on computer equipment including laptops, desktops, servers, network attached storage, etc.; cost of purchased software; cost of software licensing and upgrade agreements; etc.

Line 24 -        Errors and Omissions Insurance

Line 25 -        Other Insurance includes property insurance, liability insurance, fidelity and surety bonds, etc.

Line 26 -        Director’s Fees, including expense allowances for travel to Board meetings.

Line 27 -        Boards and Associations includes dues paid by your agency for itself or for its employees to trade and professional associations (e.g., American Land Title Association, New York State Land Title Association, Chamber of Commerce, bar associations, etc.); fees to attend professional and trade association meetings; etc.

Line 28 -        Legal and Auditing includes fees paid to outside accounting firms and law firms

Line 29 -        Bad Debts includes amounts originally booked as income that were written off as uncollectable including any charge offs.  Please include any unreimbursed Closing / Escrow losses and any Abstract / Search losses (from abstracts /searches sold) in this category.  Unreimbursed title losses paid (i.e., losses paid by the agent, but not reimbursed by the underwriter) are also to be included in this line.  Note that any expense items that can be reported on Lines 9 or 10 above are to be reported on those lines and not reported on Line 29.

Line 30 -        Interest includes interest paid to banks and/or suppliers. It excludes mortgage interest reported on Line 13.

Line 31 -        Other includes all expenses not reported on Lines 11 to 30.  Additional details for this expense category are to be provided on Part 2.  The total amount for this expense category on Part 2 must agree to the amount reported on Part 1.

Line 32 -        Total Expenses is the sum of Lines 7 to 31

Line 33 -        Net is Line 6 less Line 32

Line 34 -        Number of Employees is the number of full-time equivalent personnel (i.e., report two half-time employees as one full-time equivalent employee)

Note: agents conducting business in multiple states are required to make a reasonable allocation of the number of employees devoted to title insurance operations in New York State, as described above.  Similar allocations need to be made for agents that are part of a law firm or have multiple underwriters.

Part 2 Instructions (General Expenses additional Detail)  Lines 16.01-

The NYSDFS has requested that all agents provide additional detail for the amounts reported in the following expense categories:

• Advertising Expense (Part 1 Line 16) (16.01 to 16.12)
• Marketing and Promotional Expenses (Part 1 Line 17) (17.01 to 17.10)
• Travel (Part 1 Line 19) (19.01 to 19.08)
• Other (Part 1 Line 31) (31.01 to 31.06)

In Part 2 of the schedule we have provided a line for each of several possible expense types that may appear in the broader categories mentioned above and displayed on Part 1 (On the web site listed as Lines 16.01 to 31.06). Please enter the amounts for each of these categories in the sub number to comply with Part 2.  Within each of the four main categories, there is also provided an “Other” line to accommodate the entry of any amounts not covered by the items explicitly identified.

Note: it is important that the sums of the detailed items in Part 2 for each category agree with the amounts reported on Part 1.

Part 3 Instructions

Note that Part 3 on the web site is the “other section” provided to you for ease of data submission.  For your information, after receiving the responses to this agent call, the underwriters will be required to submit Part 3 for each individual responding agent to Milliman. Milliman is the Statistical Consultant for TIRSA for the 2013 Data Call.  Milliman will then transmit these files to TIRSA and TIRSA will then provide these sheets to the NYSDFS.  The individual agency name and other identifying information have been removed from Part 3.

In the event that amounts have been entered in the “Other” line for Advertising Expenses (16.12), Marketing and Promotional Expenses (17.10), Travel Expenses (19.08) or Other Expenses (31.06) in Part 2, enter a detailed description for each of the items that fall within these “Other” lines.  10 lines have been provided for each of the 4 categories.  Also, provide an overall amount for each item entered on Part 3 if possible. 

Note: it is important that the sums of the detailed items in Part 3 for each category agree with the amounts reported on Part 2.

We know that this data call may be difficult for each office to accomplish and we stand ready to assist you.  We appreciate your best efforts to assist in the full compliance with the NYSID directive. 

Attached is a sample of the U-4 schedule.  Please do not hesitate to contact company counsel with any questions you might have. 

References:

Bulletins Replaced:     None
Related Bulletins:       None
Underwriting Manual    None
Exceptions Manual:     None
Forms:                      U-4 Schedule
Attachments:             None