Assigned to FICO AS PASSED BY HOUSE
ARIZONA STATE SENATE
Fifty-Sixth Legislature, Second Regular Session
AMENDED
FACT SHEET FOR S.B. 1042
cremation
(NOW: title companies; recorded documents; DIFI)
As passed by the Senate, S.B. 1042 added natural organic reduction as a statutorily
allowed method of cremation and modifies the definitions of cremation, cremated remains and
processed cremated remains.
The House of Representatives adopted a strike-everything amendment that does the
following:
Purpose
Outlines the enforceability of an agreement to indemnify a title insurer from risks arising
from a properly recorded instrument exclusively for that instrument if the agreement meets certain
criteria.
Background
The Director of the Department of Insurance and Financial Institutions (DIFI) oversees and
administers licensure for title insurance agents. A title insurance agent license applicant must apply
on a form prescribed by the Director of DIFI and submit all applicable fees. Title insurance agents'
licenses must be renewed quadrennially.
Every title insurer must file with the Director of DIFI all forms of title policies and other
contracts of title insurance before issuance of any policy or contract. A title insurance rating
organization may make filings on behalf of all of its members or subscribers. A title insurer may
not issue any policy or contract until 30 days after the policy or contract has been filed with the
Director of DIFI. A policy or contract is approved 30 days after filing unless the Director of DIFI
has issued, within the 30-day period, an order affirmatively approving or disapproving the form.
The Director of DIFI may extend the period for up to 15 additional days to complete the review of
the filing by giving notice within the 30-day period to the title insurer.
Forms of title policies and other contracts of insurance must specifically exclude:
1) reinsurance contracts or agreements; 2) all specific defects in title that may be ascertained from
an examination of the risk and excepted in reports, binders or policies, together with any
affirmative assurance of the title insurer with respect to the defects whether given by endorsement
or otherwise; and 3) further exceptions from coverage by reason of limitations on the examination
of the risk imposed by an applicant for insurance or through failure of an applicant for insurance
to provide the date requisite to a judgment of insurability.
Title insurance insures, guarantees or indemnifies owners of real property or others
interested therein against loss or damage suffered by reason of liens, encumbrances upon, defects FACT SHEET – Amended
S.B. 1042
Page 2
in or the unmarketability of the title to such property, guaranteeing, warranting or otherwise
insuring the correctness of searches relating to the title to real property, or doing any business in
substance equivalent to any of the foregoing (A.R.S. §§ 20-1562; 20-1580 and 20-1591).
There is no anticipated fiscal impact to the state General Fund associated with this
legislation.
Provisions
1. Stipulates that an agreement by a person to indemnify or hold harmless a title insurer from
risks arising from an instrument that is or becomes properly recorded and indexed in the office
of the county recorder is only enforceable, if the agreement is in writing and any of the
following are met:
a) the instrument was not of record at the time the agreement was executed;
b) the instrument is specifically described in the agreement;
c) the instrument is shown as an exception from coverage in the title insurance policy;
d) the agreement indemnifies for or holds harmless against liens that arise from work or labor
done or professional services, materials, machinery, fixtures or tools furnished on the
insured property; or
e) the instrument is or secures a monetary obligation of the person and the instrument remains
an outstanding and enforceable debt, except that an improvement district assessment is not
a monetary obligation of the person.
2. Specifies that the outlined stipulation does not affect the enforceability of title warranties
provided by a person in a deed or mortgage.
3. Specifies that an agreement that meets the outlined stipulation must be separate from and not
included in the title insurance policy.
4. Contains a statement of legislative intent.
5. Makes technical changes.
6. Becomes effective on the general effective date.
Amendments Adopted by the House of Representatives
• Adopted the strike-everything amendment relating to title companies.
House Action
RA 3/20/24 DPA/SE 7-0-0-0
3
rd
Read 3/28/24 54-0-5-0-1
Prepared by Senate Research
April 1, 2024
MG/JC/cs