TO: All Title Agents

SUBJECT: Requirement to Recover Cost of Providing Additional Information in Listing Packages


Rule 56 of the Idaho Administrative Procedure Act (“IDAPA”) governs what is considered a rebate and/or illegal inducement to obtaining title insurance. Recently, the Idaho Department of Insurance (the “Department”) was made aware of an industry practice that violates IDAPA with regard to assessing and recouping the costs associated with the creation, production and delivery of listing packages that contain additional information described in IDAPA The purpose of this advisory is to delineate the costs that should be assessed and to clarify that those costs must be collected in advance of disseminating such additional information with a listing packet. IDAPA states as follows:

Market value information, demographics, or additions, addenda, or attachments which may be construed as conclusions reached by the title entity regarding matters of marketable ownership or encumbrances may be provided, but only upon receipt of a charge commensurate with the actual cost of the work performed and the material furnished.

[Emphasis added.]

Section 11 of EXHIBIT 1 to IDAPA 18.01.56 states as follows:

A title entity shall not furnish reports containing publicly recorded information, appraisals, estimates, or income production potential, information kits or similar packages containing information about one or more parcels of real property (other than as permitted in Section 012) helpful to any producer of title business, consumer, or member of the general public without making a charge that is commensurate with the actual cost of the work performed and the material furnished (e.g. “farm packages”, lot book reports, tax information, title commitments).

[Emphasis added.]

The actual cost of work performed should include any time expended by the agent or staff of the agent in collecting information, researching, producing, assembling, delivering, or any other effort. Thus, whether the employee preforming these duties is compensated on an hourly basis or by salary, a charge for the pro rata share of the employee’s time dedicated to that function must be calculated and included in the cost assessment for the additional information contained in the listing packet. A charge for the pro rata use of any mapping or demographic system should also be calculated and included. In addition, the actual cost of the materials furnished should be included, such as a pro rata cost for the consumption of printing supplies and office products as well as the actual cost of paper, folders, binders, etc.

The Department clarifies through this advisory that all such assessments must be collected in advance of providing the information to producers of title business. IDAPA states clearly that title agents must not disseminate a listing packet containing the additional information without first collecting an assessment commensurate with the actual cost of gathering and assembling the information. Thus, by the plain language of the rule, allowing assessment fees to accumulate in arrears and/or failing to collect assessment fees are violations.

Title agents are subject to Idaho Code § 41-2710(7) which provides that the Department shall conduct regular examinations of “track indexes, abstract records and any other records to ascertain compliance with title 41, Idaho Code, and related rules….” Such examinations occur every five (5) years after the initial examination.

The Department will be verifying compliance with IDAPA during the course of the five (5) year agent examination. Additionally, as part of an investigation of an inquiry or complaint concerning compliance with the Idaho Insurance Code and related rules, the Department will review documentation provided by the agent that purports to support a determination of the actual cost of the work performed and the material furnished in connection with providing additional information in a listing package pursuant to IDAPA The examiner will also review the agent’s deposit records to verify that the charge for additional information was collected prior to dissemination of the listing packet containing the additional information.

Should the Department determine that an agent’s practices demonstrate a failure to charge a fee commensurate with the actual cost of the work performed and the materials furnished and/or demonstrate a failure to collect the charge in advance of providing the additional information to a producer of title insurance, consumer or member of the general public, such practices may be considered as an illegal inducement in violation of IDAPA

Pursuant to IDAPA, treble damages may be assessed as a general penalty for an illegal inducement, calculated at three (3) times the cumulative total of such illegal inducement. Additionally, those found in violation of title 41 and/or any related rules may also be subject to an administrative penalty of $5,000.00.

Please feel free to contact me with any questions you might have.


Jim Scanlon
Examiner Title & Market Insurance Specialist

(208) 334-4321