00                            HOUSE BILL NO. 424                                                                          
01 "An Act relating to title insurance; and providing for an effective date."                                              
02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
03    * Section 1.  AS 21.66.200 is amended to read:                                                                     
04            Sec. 21.66.200.  Title plant requirements.  A title insurance company or title                         
05       insurance limited producer shall own and maintain in the recording district in which                          
06       its principal office in the state is located a title plant consisting of adequate maps and                        
07       fully indexed records showing all instruments of record affecting all land within the                             
08       recording district for a period of at least 40 [25] years immediately before the date a                       
09       policy of title insurance is issued by the title insurance company.  It shall also directly                       
10       [OR THROUGH ITS AGENT] own and maintain a comparable title plant for each                                         
11       additional recording district in which it [OR ITS AGENT] maintains an office to                                   
12       transact a title insurance business.                                                                              
13    * Sec. 2.  AS 21.66.210(a) is amended to read:                                                                     
14            (a)  Two or more title insurance companies or two or more title insurance                                    
15       limited producers, or a combination of title insurance companies and title insurance                              

01       limited producers, may apply to the director of insurance to form an association,                                 
02       corporation, or other legal entity, for the purpose of engaging in the business of                                
03       preparing abstracts of title searches [FROM PUBLIC RECORDS OR] from records to                                    
04       be owned by the entity as required by the title plant provisions of AS 21.66.200,                             
05       upon the basis of which a title insurance limited producer or a title insurance company                           
06       will issue title policies.  The owners or participants are considered to be in compliance                         
07       with the provisions of this section if the title plant of the association, corporation, or                        
08       other legal entity complies with the provisions of this section.  The application must                            
09       contain                                                                                                           
10                 (1)  a copy of the proposed articles of incorporation or association and                                
11       the bylaws or agreement governing the operation of the entity;                                                    
12                 (2)  a list of the owners or participants;                                                              
13                 (3)  the names and addresses of the persons who will operate the entity,                                
14       with a description of their experience and qualifications;                                                        
15                 (4)  the conditions under which ownership or participation in the entity                                
16       may be sold or acquired;                                                                                          
17                 (5)  a statement of whether or not title information will be compiled and                               
18       sold to persons other than owners of or participants in the entity;                                               
19                 (6)  a pro forma balance sheet and other financial information to                                       
20       indicate the sufficiency of financing the entity.                                                                 
21    * Sec. 3.  AS 21.66.240 is amended to read:                                                                        
22            Sec. 21.66.240.  Title plants.  A title insurance company or title insurance                           
23       limited producer may invest in title plants if it complies at all times with the                              
24       minimum capital investment requirements under this chapter.  A title plant shall be                               
25       considered an asset at its fair value.  In determining the fair value of a title plant, no                        
26       value may be attributed to furniture and fixtures, and the real estate in which the title                         
27       plant is housed shall be carried as real estate.  The value of title abstracts, title briefs,                     
28       copies of conveyances or other documents, indices, and other records comprising the                               
29       title plant shall be determined by considering the expenses incurred in obtaining them,                           
30       the age of them, the cost of replacements less depreciation, and all other relevant                               
31       factors.  Once the value of a title plant is determined under this section, the value may                         

01       be increased only by the acquisition of another title plant by purchase, consolidation,                           
02       or merger; however, in no event may the value of the title plant be increased by                                  
03       additions made to it as part of the normal course of abstracting and insuring titles to                           
04       real estate.  Subject to the limitations in this section and with the approval of the                             
05       director as provided by AS 21.66.210, a title insurance company or title insurance                            
06       limited producer may enter into agreements with other title insurance companies to                            
07       participate in the use, ownership, management, and control of a title plant in order to                           
08       service the needs of all the title insurance companies, or the title insurance companies                          
09       may hold stock of a corporation owning and operating a title plant for this purpose.                              
10    * Sec. 4.  This Act takes effect July 1, 2002.