AI-assisted research summary: The association must assess title insurance companies to fund its obligations and covered-claim expenses, using a proportional formula based on each company’s prior-year net direct written premiums, with a yearly cap of 2%.
Sec. 2602.202. AMOUNT OF ASSESSMENT; PRORATION OF PAYMENT. (a) The association shall assess title insurance companies the amount necessary to pay: (1) the association's obligations under this chapter and the expenses of handling covered claims subsequent to an impairment; and (2) other expenses authorized by this chapter. (b) The assessment of each title insurance company must be in the proportion that the net direct written premiums of that company in this state for the calendar year preceding the assessment bear to the net direct written premiums of all title insurance companies for that year. Assessments and supplemental assessments may be made in consecutive years until the association has collected an amount sufficient to pay the obligations and expenses described under Subsection (a). The association may make a supplemental assessment only against the same title insurance companies and in the same proportion for each company as the initial assessment. (c) The total assessment of a title insurance company in a year may not exceed an amount equal to two percent of the company's net direct written premiums for the calendar year preceding the assessment. If the maximum assessment and the association's other assets are insufficient in any one year to make all necessary payments, the money available shall be prorated and the unpaid portion shall be paid as soon as money becomes available. Added by Acts 2003, 78th Leg., ch. 1274, Sec. 6, eff. April 1, 2005. Amended by: Acts 2019, 86th Leg., R.S., Ch. 775 (H.B. 1614), Sec. 17, eff. September 1, 2019.