Marvin Mandel, Governor                        1343

CHAPTER 641

(Senate Bill 139)

AN ACT to repeal Section 486-1 of Article 48A of the Annotated
Code of Maryland (1968 Replacement Volume), as amended, title
"Insurance Code," subtitle "Title Insurance," and to enact a new
Section 486-1 to stand in place of the one repealed, to provide
for fixing the time of inception, contingencies and conditions of
title insurance, and to require adequate disclosure of conditions
and limitations under which it is made available to buyers of
real estate.

Section 1. Be it enacted by the General Assembly of Maryland,
That Section 486-1 of Article 48A of the Annotated Code of Mary-
land (1968 Replacement Volume), as amended, title "Insurance
Code," subtitle "Title Insurance," be and it is hereby repealed and
new Section 486-1 enacted to stand in place of the one repealed, to
read as follows:

[486-1.

(a)  Whenever in connection with any real estate transaction in-
volving land situated and lying in this State any title insurance
company shall issue a policy insuring the title to such property for
the benefit of any mortgagee, such title insurance company shall
notify the mortgagor, or cause such mortgagor to be notified by its
agent, employee or approved attorney that a mortgagee title in-
surance policy is to be issued, the name or names of the insured
under said policy, and of the face amount of such policy. Such notice
shall also advise the mortgagor of his right and opportunity to obtain
title insurance in his own favor and the additional premium that
will be required for the purchase of the same. Any notice shall be
in writing and shall be delivered prior to the disbursement of the
mortgage funds.

(b)  Prior to the disbursement of the mortgage funds the title
insurance company, its agent, employee or approved attorney shall
obtain from the mortgagor a statement in writing that he has re-
ceived the notice required under subsection (a) of this section.

(c)  The original signed statement required by subsection (b) of
this section, together with a copy of the notice required by subsection
(a) of this section shall be retained by the title insurance company
for a period of three (3) years following the issuance of the title
insurance policy. Such statement and notice shall be available for
inspection by the Commissioner upon request.]

486-1.

(a) Whenever in connection with any real estate transaction in-
volving A PURCHASE MONEY MORTGAGE OR MORTGAGES
ON land situated and lying in this State any title insurance com-
pany shall accept a premium, for a policy insuring the title to such
property or such title insurance company, its agent, employee or
approved attorney shall accept a premium for owner and mortgagee
title insurance, the person first accepting such premium shall insert
the names of every insured in the binder for the title insurance, OR