SOUTHERN TITLE INSURANCE CORPORATION
FREQUENTLY ASKED QUESTIONS
WHAT IS THE STATUS OF SOUTHERN TITLE INSURANCE CORPORATION?
On December 20, 2011, Southern Title Insurance Corporation (“Southern Title” or the “Company”)
was placed in Receivership for rehabilitation or liquidation by Order of the Circuit Court of the City of Richmond
(“Circuit Court”). In its Order, the Circuit Court appointed the State Corporation Commission of the Commonwealth
of Virginia (“Commission”) as Receiver for Southern Title. The Circuit Court placed Southern Title in receivership
as it found the Company to be in a hazardous financial condition such that any further transaction of its business
would have been hazardous to Southern Title insureds, policyholders, creditors, and the public. The receivership
provides for the control and oversight of Southern Title by the Commission, as Receiver, for the protection of
policyholders and creditors.
|Question 2:||IS SOUTHERN TITLE ISSUING NEW INSURANCE POLICIES?|
|Answer:||No. The Circuit Court Order placing Southern Title in receivership permanently enjoins Southern Title from writing any new business.|
IS SOUTHERN TITLE BEING LIQUIDATED?
|Answer:||Yes. On July 28, 2014, the Commission entered its Order of Liquidation with Finding of Insolvency (“Order of Liquidation”) in which it found Southern Title to be insolvent and so ordered that the Company be liquidated.|
|Question 4:||WHY WAS IT NECESSARY TO ORDER THE LIQUIDATION OF SOUTHERN TITLE?|
The Commission ordered that Southern Title be liquidated as it found that Southern Title was insolvent and that further efforts to rehabilitate the Company would be futile.
DOES THE ORDER OF LIQUIDATION SET A DEADLINE FOR FILING CLAIMS WITH SOUTHERN TITLE?
Yes. The Order of Liquidation established January 28, 2015, as the Claims Filing Deadline. The Order of Liquidation also requires that all claims must be rendered certain, liquidated, and non-contingent within a reasonable time after initial presentment, but no later than January 28, 2016, one year after expiration of the Claims Filing Deadline. Claims received by Southern Title after the Claims Filing Deadline are considered as Late Filed Claims and in general, cannot be paid until all timely-filed claims have been paid in full.
|Question 6:||HOW DOES THE LIQUIDATION OF SOUTHERN TITLE AFFECT MY TITLE INSURANCE POLICY WITH SOUTHERN TITLE?|
The July 28, 2014, Order of Liquidation ended all efforts to rehabilitate the Company and initiated the final wind down of Company operations which will conclude with a distribution of available assets to policyholders and creditors subject to the priority scheme set forth at Virginia Insurance Code Sec. 38.2-1509 and 38.2-4613. With the distribution of available assets, all Southern Title insurance policies are effectively cancelled, and receivership operations will end with closure of the receivership estate.
|Question 7:||HAS SOUTHERN TITLE BEEN DESIGNATED AS AN “INSOLVENT INSURER” SO AS TO TRIGGER THE PROVISIONS OF ANY APPLICABLE GUARANTY ASSOCIATIONS?|
Yes. In the Order of Liquidation, the Commission found
Southern Title to be insolvent triggering the participation of two guaranty associations, the Texas Title Insurance
Guaranty Association (“TTIGA”), and the Maryland Property and Casualty Insurance Guaranty Corporation. For
properties located in the states of Texas or Maryland, these guaranty associations may provide coverage for losses
arising under the terms of your Southern Title policy. Contact information for these guaranty associations is
Maryland Property and Casualty Insurance Guaranty Corporation
305 Washington Avenue, Suite 600
Towson, Maryland 21204
Texas Title Insurance Guaranty Association
500 W. 5th Street, Suite 1150
Austin, Texas 78701
Please note that certain obligations of TTIGA concerning policies issued by Southern Title in the state of Texas have been assumed by First National Title Insurance Company (“FNTI”). Claims previously filed with Southern Title or TTIGA prior to February 1, 2017, the effective date of the assumption, were not included in the assumption by FNTI, and claimants should continue to contact Southern Title or TTIGA regarding such claims. Contact information for FNTI is as follows:
First National Title Insurance Company
2400 Dallas Parkway, Suite 580
Plano, Texas 75093
WHAT IS THE STATUS OF MY PENDING POLICYHOLDER CLAIM FILED WITH SOUTHERN TITLE?
Although Southern Title continues to accept and process all
claims filed with the Company, the Deputy Receiver’s Third Directive, effective as of July 26, 2012, imposed a complete
suspension and moratorium on the payment of claims, except for administrative expense claims and any secured claims
against Southern Title. Therefore, no claim payments can be made on pending policyholder claims until the Commission
enters an order lifting the moratorium and authorizing the distribution of available assets in a manner that treats
all claimants fairly and ratably without resulting in an improper preference being given to any creditor.
HOW DO I PRESENT CLAIMS THAT I HAVE UNDER A SOUTHERN TITLE POLICY?
is too early for us to speculate about that. Claims for coverage may be submitted to Southern Title by e-mail,
fax, or postal mail using the following:
Fax NO.: (804) 644-4032
Address: P.O. Box 399, Richmond, Virginia 23218-0399