N.Y. Insurance Law § 6403: Management and powers of title insurance corporation

§ 6403. Management and powers of title insurance corporation. (a) The

business and affairs of every title insurance corporation shall be

managed under the direction of its board of directors.

(b) Every title insurance corporation shall, subject to the exceptions

and restrictions contained in this chapter, have power to do, in

addition to the powers granted by the business corporation law, only the

following kinds or any of the kinds of business, of which those

specified in paragraphs one and two hereof shall be deemed doing an

insurance business:

(1) To make and to guarantee the correctness of searches for all

instruments affecting titles to real property, chattels real, and

cooperative units and proprietary leases, and for all liens or charges

affecting the same.

(2) To issue title insurance policies.

(3) To examine titles to real property and chattels real and to

procure and furnish information in relation thereto and to personal

property used in connection therewith.

(4) To invest in, purchase and sell mortgages upon improved and

unencumbered real property appraised for at least fifty per centum more

than the amount loaned thereon or obligations secured by such mortgages

or senior participations or interests therein, without guaranteeing the

performance of any contract in respect thereto or the guaranteeing of

payment of taxes, penalties, foreclosure costs or other expenses with

respect to the same. "Senior participation", in this section, means all

that portion or portions of the obligation secured by a first mortgage

which has legal priority over all other portion or portions of such

obligation, known as junior participation.

(5) To invest in or acquire for resale, (i) obligations secured by a

mortgage (including any part of an issue of such obligations) which are

insured or committed to be insured by the Federal Housing Administrator,

or (ii) debentures lawfully issued by the Federal Housing Administrator.

(6) To act as agent in fact for investors in, and the holders of,

mortgages or obligations mentioned in paragraphs four and five hereof,

and interests therein, in the purchase, sale and servicing thereof; to

act as agent in fact for investors in supervising and inspecting land

and buildings for the purpose of loans to be made thereon, and in

recommending, without any guaranty or similar undertaking as to the

amounts of such loans and amounts to be advanced thereon, but not to

engage in the business of making real estate appraisals.

(c) No title insurance corporation doing business in this state shall

expose itself to any loss on any one risk in an amount exceeding the sum

of its capital, surplus, statutory premium and any voluntary reserves,

all as shown in its most recent quarterly or annual statement filed with

the superintendent. Any risk or portion thereof which shall have been

reinsured with an assuming insurer authorized to do such business in

this state shall be deducted in determining the limitation of risk

prescribed in this subsection. Credit to the ceding insurer for

reinsurance with an unauthorized insurer shall be allowed to the extent

permitted by a regulation of the superintendent.