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SF 3594

3rd Engrossment - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Introduction Posted on 03/06/2008
1st Engrossment Posted on 03/25/2008
2nd Engrossment Posted on 05/02/2008
3rd Engrossment Posted on 05/16/2008

Current Version - 3rd Engrossment

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A bill for an act
relating to commerce; regulating real estate transactions; defining terms;
amending Minnesota Statutes 2006, sections 60A.06, subdivision 1; 68A.04;


Section 1.

Minnesota Statutes 2006, section 60A.06, subdivision 1, is amended to read:

Subdivision 1.

Statutory lines.

Insurance corporations may be authorized to
transact in any state or territory in the United States, in the Dominion of Canada, and in
foreign countries, when specified in their charters or certificates of incorporation, either as
originally granted or as thereafter amended, any of the following kinds of business, upon
the stock plan, or upon the mutual plan when the formation of such mutual companies is
otherwise authorized by law; and business trusts as authorized by law of this state shall
only be authorized to transact in this state the following kind of business hereinafter
specified in clause (7) hereof when specified in their "declaration of trust":

(1) To insure against loss or damage to property on land and against loss of rents
and rental values, leaseholds of buildings, use and occupancy and direct or consequential
loss or damage caused by fire, smoke or smudge, water or other fluid or substance,
lightning, windstorm, tornado, cyclone, earthquake, collapse and slippage, rain, hail,
frost, snow, freeze, change of temperature, weather or climatic conditions, excess or
deficiency of moisture, floods, the rising of waters, oceans, lakes, rivers or their tributaries,
bombardment, invasion, insurrection, riot, civil war or commotion, military or usurped
power, electrical power interruption or electrical breakdown from any cause, railroad
equipment, motor vehicles or aircraft, accidental injury to sprinklers, pumps, conduits
or containers or other apparatus erected for extinguishing fires, explosion, whether fire
ensues or not, except explosions on risks specified in clause (3); provided, however, that
there may be insured hereunder the following: (a) explosion of any kind originating
outside the insured building or outside of the building containing the property insured, (b)
explosion of pressure vessels which do not contain steam or which are not operated with
steam coils or steam jackets; and (c) risks under home owners multiple peril policies;

(2)(a) To insure vessels, freight, goods, wares, merchandise, specie, bullion, jewels,
profits, commissions, bank notes, bills of exchange, and other evidences of debt, bottomry
and respondentia interest, and every insurance appertaining to or connected with risks of
transportation and navigation on and under water, on land or in the air;

(b) To insure all personal property floater risks;

(3) To insure against any loss from either direct or indirect damage to any property
or interest of the assured or of another, resulting from the explosion of or injury to
(a) any boiler, heater or other fired pressure vessel; (b) any unfired pressure vessel;
(c) pipes or containers connected with any of said boilers or vessels; (d) any engine,
turbine, compressor, pump or wheel; (e) any apparatus generating, transmitting or using
electricity; (f) any other machinery or apparatus connected with or operated by any of
the previously named boilers, vessels or machines; and including the incidental power
to make inspections of and to issue certificates of inspection upon, any such boilers,
apparatus, and machinery, whether insured or otherwise;

(4) To make contracts of life and endowment insurance, to grant, purchase, or
dispose of annuities or endowments of any kind; and, in such contracts, or in contracts
supplemental thereto to provide for additional benefits in event of death of the insured by
accidental means, total permanent disability of the insured, or specific dismemberment
or disablement suffered by the insured, or acceleration of life or endowment or annuity
benefits in advance of the time they would otherwise be payable;

(5)(a) To insure against loss or damage by the sickness, bodily injury or death by
accident of the assured or dependents, or those for whom the assured has assumed a
portion of the liability for the loss or damage, including liability for payment of medical
care costs or for provision of medical care;

(b) To insure against the legal liability, whether imposed by common law or by
statute or assumed by contract, of employers for the death or disablement of, or injury
to, employees;

(6) To guarantee the fidelity of persons in fiduciary positions, public or private, or
to act as surety on official and other bonds, and for the performance of official or other

(7) To insure owners and others interested in realnew text begin or personal property as described in
section 68A.04
new text end deleted text beginestate against loss or damage, by reason of defective titles, encumbrances,
or otherwise
deleted text end;

(8) To insure against loss or damage by breakage of glass, located or in transit;

(9)(a) To insure against loss by burglary, theft, or forgery;

(b) To insure against loss of or damage to moneys, coins, bullion, securities, notes,
drafts, acceptance or any other valuable paper or document, resulting from any cause,
except while in the custody or possession of and being transported by any carrier for
hire or in the mail;

(c) To insure individuals by means of an all risk type of policy commonly known as
the "personal property floater" against any kind and all kinds of loss of or damage to, or
loss of use of, any personal property other than merchandise;

(d) To insure against loss or damage by water or other fluid or substance;

(10) To insure against loss from death of domestic animals and to furnish veterinary

(11) To guarantee merchants and those engaged in business, and giving credit,
from loss by reason of giving credit to those dealing with them; this shall be known
as credit insurance;

(12) To insure against loss or damage to automobiles or other vehicles or aircraft
and their contents, by collision, fire, burglary, or theft, and other perils of operation,
and against liability for damage to persons, or property of others, by collision with such
vehicles or aircraft, and to insure against any loss or hazard incident to the ownership,
operation, or use of motor or other vehicles or aircraft;

(13) To insure against liability for loss or damage to the property or person of
another caused by the insured or by those for whom the insured is responsible, including
insurance of medical, hospital, surgical, funeral or other related expense of the insured
or other person injured, irrespective of legal liability of the insured, when issued with or
supplemental to policies of liability insurance;

(14) To insure against loss of or damage to any property of the insured, resulting
from the ownership, maintenance or use of elevators, except loss or damage by fire;

(15) To insure against attorneys fees, court costs, witness fees and incidental
expenses incurred in connection with the use of the professional services of attorneys
at law.

Sec. 2.

Minnesota Statutes 2006, section 68A.04, is amended to read:

68A.04 deleted text beginDEFINITION OF DIRECT RISK PREMIUMSdeleted text endnew text begin DEFINITIONSnew text end.

new text begin Subdivision 1. new text end

new text begin Direct risk premiums. new text end

For purposes of this chapter, "direct risk
premiums" means the charge for title insurance made by a title insurance company or its
agents according to the company's rate filing approved by the commissioner of commerce
without a deduction for commissions paid to or retained by the agent and is that portion of
the fee charged by a title insurance company to an insured or an applicant for insurance
for the assumption by the title insurance company of the risk created by the issuance
of the title insurance policy. Direct risk premiums of a title insurance company do not
include any other charge or fee for abstracting, searching, or examining the title, or for
escrow, closing, or other related services.

new text begin Subd. 2. new text end

new text begin Title insurance. new text end

new text begin For purposes of this chapter, "title insurance" means
insuring owners of real or personal property, the holders of liens, interests or encumbrances
thereon, or others interested therein, against loss or damage suffered by reason of liens,
encumbrances upon, defects in, or the unmarketability of the title to the property; the
invalidity, impairment, lack of priority, or unenforceability of any liens or encumbrances
on the property; or the doing, or proposing to do, any business in substance equivalent to
any of the foregoing whether or not designed to evade the provisions of this chapter.
new text end

Sec. 3.

Minnesota Statutes 2006, section 82.49, is amended to read:


Subdivision 1.


(a) For purposes of this section, the terms in this
subdivision have the meanings given them.

(b) "Closing agent" has the meaning given in section 82.17, subdivision 3.

(c) "Collected funds" means funds deposited, finally settled, and credited to the
closing agent's escrow account.

(d) deleted text begin"Established business relationship" means that the closing agent has performed
at least 25 residential closings on behalf of the lender.
deleted text end

deleted text begin (e)deleted text end "Federally insured financial institution" means an institution in which monetary
deposits are insured by the Federal Deposit Insurance Corporation or National Credit
Union Administration.

deleted text begin (f)deleted text endnew text begin (e)new text end "Lender" means a person who makes residential mortgage loans including
a person who engages in table funding. "Lender" does not include any organization
described in section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as
amended, if the organization is exempt from tax under section 501(a) of the Internal
Revenue Code of 1986, as amended. "Lender" does not include a state or any political
subdivision of a state.

deleted text begin (g)deleted text endnew text begin (f)new text end "Qualified loan funds" means funds in one of the following forms:

(1) lawful money of the United States;

(2) wired funds when unconditionally held by the closing agent;

(3) cashier's checks, certified checks, bank money orders, or teller's checks issued by
a federally insured financial institution and unconditionally held by the closing agent; and

(4) United States treasury checks, Federal Reserve Bank checks, federal home loan
bank checks, and state of Minnesota warrants.

deleted text begin (h)deleted text endnew text begin (g)new text end "Table funding" means a closing or settlement at which a mortgage loan
is funded by a lender by a contemporaneous advance of mortgage loan funds and an
assignment of the mortgage loan to the lender advancing the funds.

Subd. 2.


(a) A closing agent shall not make disbursements out of an
escrow, security deposit, settlement, or closing account unless the funds received from
the lender are collected funds or qualified loan funds. deleted text beginThis subdivision does not prohibit
a closing agent from electing to disburse out of an escrow, security deposit, settlement,
or closing account, other than with collected funds or qualified loan funds, if the closing
agent has an established business relationship with the lender on whose behalf the closing
is being conducted.
deleted text end

(b) A lender, using the closing services of a closing agent, shall at or before the time
of the closing deliver loan funds to the closing agent either in the form of collected funds
or qualified loan funds.