The American Land Title Association (ALTA) recently published a new set of guidelines concerning best practices for title and settlement companies, with the focus being consumer protection.
While several companies follow regular industry practices, ALTA is pushing its members to officially document each and every procedure against the latest levels of performance.
Outlined below are the seven best practices suggested by ALTA. Carefully consider each recommendation in order to fully understand what the company is trying to convey.
1. Set up and maintain a current license. This is necessary to perform the business of both settlement and title insurance services.
2. Implement and keep proper written procedures and key controls regarding escrow trust accounts enabling electronic confirmation for reconciliation.
Customer funds protection is the main theme in the revised best practices. Along with keeping separate funds, the accounts should be properly named, reconciled on a daily and monthly basis, and only kept in institutions that are federally insured.
Potential title company workers who will manage consumer funds will undergo background and credit checks as a necessary part of the process for getting hired.
3. Implement and keep a written privacy and data security program in order to guard private personal information required by federal, state, and local law.
Physical security, network security, and disaster planning are recognized as areas of special concern. The ALTA recommends that firms incorporate protection against external forces that could try to violate the security of the agent.
Continuous employee training is suggested along with the careful monitoring of any contractors hired outside the company.
4. Implement typical real estate settlement policies and procedures that will keep in compliance with state and federal consumer financial laws.
Pricing and recording procedures are detailed in the following area in order to protect the financial and legal interests of the customer.
5. Implement and keep written procedures associated with premium remittance, reporting, delivery and title policy production.
6. Keep proper expert fidelity coverage and liability insurance.
7. Implement and maintain protocol for all consumer complaint resolutions.
Resources for ALTA’s Best Practices
Members of ALTA are offered a Best Practices Toolkit, which contains new information that’s updated on a weekly basis. Checklists are also provided in order to help members assess their compliance against industry level recommendations.
As more and more title insurance and settlement companies revamp their systems and procedures to comply with ALTA Best Practice guidelines, Axis Technical Group is here to help. We have been serving the title insurance industry for many years now and offer a wide range of IT business products and services to help your company become and stay compliant. Contact us today to find out how we can help your organization. Give us a call at 888.491.2636. You can also email us at info@axistechnical.com.