Texas Senate Bill SB735

Texas 2011 - 82nd Regular

• Out of Senate Committee: 3/2/11
• Introduced: 2/16/11
• Voted on by Senate: 3/17/11
• Out of House Committee: 5/12/11
• Voted on by House: 5/23/11
• Governor Action: 6/17/11
• Refer: 4/28/11
• Report Pass: 5/12/11
• Enrolled: 5/23/11
• Passed: 6/17/11

Caption

Relating to prohibition of certain extra hazardous coverages by title insurance companies.

Impact

The implementation of SB735 is expected to reinforce consumer protections within the title insurance sector by explicitly forbidding insurance coverage related to specified types of hazardous transfers. By outlining these prohibitions, the bill seeks to minimize the risk of fraudulent claims that could undermine the rights of future creditors and property buyers. This legislation may also help maintain transparency and reliability within the title insurance market as it restricts coverage on high-risk transactions.

Summary

Senate Bill 735, introduced by Senator Carona, focuses on the regulation of title insurance companies in Texas, specifically prohibiting them from providing coverage against certain hazardous transactions. The bill prohibits title insurers from insuring against loss or damage resulting from claims that involve preferential or fraudulent transfers under federal bankruptcy laws or similar state laws. This measure aims to protect consumers and ensure the integrity of transactions related to property ownership and mortgages.

Contention

While the bill is presented as a necessary measure to protect consumers and uphold legislative integrity, discussions around its provisions suggest differing opinions on the implications for title insurance practices. Critics may argue that such prohibitions could limit the coverage options available to title companies, potentially driving up costs for consumers or restricting the ability of insurers to adapt to various market conditions. Proponents, on the other hand, view the restrictions as essential for safeguarding against fraudulent activities that can arise during property transactions.