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Title Insurance and Settlement Best Practices

May 14, 2018

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Real Estate ClosingMaybe you've heard the phrase "best practices" used in association with a business or an industry, but what exactly does it mean? Merriam-Webster defines best practice, in part, as "a procedure that has been shown by research and experience to produce optimal results . . ." It goes on to state that best practice is a standard deemed suitable for widespread adoption and use in a given industry. Ideally, every industry has a set of standards and guidelines suitable for use as best practices. Those companies that adhere to best practices in their field are generally considered more reputable.

Why are Best Practices Important?

When best practices are established and accepted as the standard way of doing things in any industry, consumers become accustomed to those guidelines and can easily recognize when they aren't getting the service they should be getting. Take, for instance, the food industry. There are universal best practices for cleanliness that food services follow to maintain a healthy environment. Wearing hair nets when you're cooking food is a best practice. This is something that has been adopted, and is required in most cases, throughout the food industry. A food establishment that doesn't enforce the hair net rule isn't necessarily a bad establishment, but if they aren't following something as simple as wearing hair nets when cooking, what else might they be overlooking? This is why it's so important a company knows, and follows, the best practices in its industry.

The tile insurance and settlement industry have a set of best practices that consumers can look for when looking for a title agency. Many of these best practices are actually laws that must be followed for a title agency to maintain the necessary licenses to operate.

  • Maintaining current licenses. Title agencies should always make sure all of their licenses are up to date. No individual or collective can practice as a title insurance agency unless it there is a title insurance agency license. Individual branches of a title insurance agency don't need to have licenses as long as the main office has one. This means if one branch commits a violation, that violation affects the company as a whole. Offices that only do closing don't need to be licensed, nor is it required they have a licensed title agent present at that particular office.

  • Client Protection
  • Protection of client privacy. This is an essential part of title insurance and settlement. Protecting privacy should be a top priority. It is standard practice for title agencies to create and follow a policy designed to keep all non-public information about their clients completely confidential. There are local, state, and federal guidelines in place that dictate how private information can be used by any title agency. There are many ways client privacy can be protected, including restricting access to non-public information to only authorized employees, ensuring secure access to, and secure transmission of, all company files and information, and proper disposal of any non-public client information according to federal guidelines that dictate how private information should be handled. Adhering to these best practices are essential to maintaining client privacy and trust. Proper training regarding the use of all company information technology is crucial to ensuring accidental exposure of client information doesn't get out.

  • Institute Standard Real Estate Settlement Procedures. A settlement agent from the title company is in charge of making sure all documents are brought to closing and that all closing costs are collected, and monies are distributed. State and federal consumer financial laws are in place that ensure settlement procedures are in place and all contractual obligations regarding the settlement process are followed. Title agencies often provide extra training to make sure employees of the agency are up to date on all of these procedures.

  • Maintain Written Procedures for Escrow trust Accounts. Effective escrow procedures and control are put into place to meet legal requirements and client rights for the protection of the client's funds held in escrow. Best practices regarding the control of escrow accounts include maintaining separate escrow and operating accounts, frequent reconciliation of escrow trust accounts, thorough documentation of account activity, and the assurance that all transaction on the account are handled by authorized employees. Escrow trust accounts should also be kept in federally insured financial institutions except by client request.

  • Company Policy and Procedure Reviews. There are many local, state, and federal laws governing how title insurance agencies operate. Title agencies should conduct regular meetings, training, and review sessions to ensure all of the contractual and legal obligations are being met on local, state, and federal levels.

  • Have Proper Liability Insurance and Fidelity Coverage. A title agency should maintain liability insurance or errors and omissions insurance. The title company should comply with all the requirements for professional liability insurance as state and federal laws dictate.


Additionally, best practices include developing a procedure for handling and resolving consumer complaints. This includes development of standardized consumer complaint forms that collect information necessary to link complaints to specific transactions, indicate a central location for the collection and handling of consumer complaints, create a system for effectively directing all complaints to appropriate company personnel, and keep an accurate and detailed log of all complaints and actions taken regarding the handling and outcome of each complaint.

Besides local, state, and federal laws that dictate best practices, some title agencies go a step further and add additional best practices to further ensure the needs of all clients are met in a professional, fair, and adequate way. There's nothing wrong with asking questions of any title agency before doing business with them. Buying a home or real estate can be one of the biggest decisions of your life and you want to be in good hands when you sit down at the closing table to finish the deal and take possession of your property. Any reputable title agency will have all the right answers. That's the company you will do business with.



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In Florida, that company is Key Title & Escrow, a full-service title agency that strives to bring our clients the best title and escrow services in the state of Florida. Key Title & Escrow is a premier Florida title company that has been serving the real estate industry for over 23 years. We have developed a reputation for quality and efficient closings. We strive to offer customer service of the highest of standards. We take pride in the professionalism and honesty our clients deserve and receive. At Key Title & Escrow, we always follow title insurance and settlement best practices with the needs of our clients at the heart of all we do.

Key Title & Escrow serves borrowers, buyers, lenders, brokers, and realtors. We offer after-hours closing and settlement services, title and escrow services, title search services, judgement and lien services, record owner searches, Florida title and homeowner's insurance, residential title services, settlement and closing services (weekend and after hours), statewide closings, statewide notary services, 24-hour access to your transactions, and more.







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