Section VI, Title Insurance Basic Manual - Administrative Rules: L-2 through G.2

1. The Texas Title Insurance Act, under Texas Insurance Code §2501.003(4), defines "escrow officer" as an attorney or bona fide employee of either (i) an attorney licensed as an escrow officer, (ii) a direct operation, or (iii) a title insurance agent, whose duties include any of the following:
   1. countersigning title insurance forms;
   2. supervising the preparation and delivery of title insurance forms;
   3. signing escrow checks; or
   4. closing the transaction, as described by Texas Insurance Code §2501.006.
2. A person may not act as an escrow officer without being licensed by TDI, and being covered by a surety bond or deposit as required by Texas Insurance Code Chapter 2652, Subchapter C; and a title insurance agent or direct operation may not employ or appoint any person as an escrow officer who is not licensed and bonded in accordance with the provisions of the Texas Title Insurance Act.
3. An attorney is not required to be licensed as an escrow officer in order to perform the duties of an escrow officer as defined in Texas Insurance Code §2501.003(4). All non-attorney employees of an attorney who perform any of the duties of an escrow officer are required to be licensed and appointed as an escrow officer by a title insurance agent or direct operation. Notwithstanding the foregoing, a direct operation or title insurance agent may not permit an attorney to conduct the attorney's business in the name of the direct operation or title insurance agent unless the attorney and all of the bona fide employees of the attorney who perform any of the duties of an escrow officer are licensed and appointed as escrow officers.
4. An attorney may become licensed as an escrow officer, in which case the attorney must comply with all requirements of the Texas Insurance Code with regard to escrow officers and trust funds, as if the attorney were a title insurance agent. All escrow accounts used by licensed and appointed escrow officers for closing transactions are subject to the audit requirements contained in Texas Insurance Code Chapter 2651, Subchapter D. An attorney licensed and appointed as an escrow officer must use a title insurance agent escrow account to close title insurance transactions. The transaction must be closed in the title insurance agent's name.
5. Neither the sole proprietor nor an individual partner of a title insurance agent, doing business as a sole proprietorship or partnership, are required to be licensed as an escrow officer. The employees of such title insurance agents who perform any or all of the duties of an escrow officer must be licensed and appointed as an escrow officer. Each corporate officer and employee of a title insurance agent, doing business as an entity, who performs any or all of the duties of an escrow officer must be licensed and appointed as an escrow officer.
6. All of the forms referred to in this rule are available on the TDI website and on request from TDI. Forms may be submitted electronically if such submission is available.
7. A military service member, military veteran, or military spouse, as defined under Texas Occupations Code §55.001, may apply under 28 Texas Administrative Code §19.803 for, and be granted, any waiver, extension, exemption, or alternative licensing requirement for the applicable requirements of Administrative Rule L-2.

1. To obtain an escrow officer license, the applicant must submit to TDI:
   1. a complete Application for Escrow Officer License (FINT132) form;
   2. an Escrow Officer Appointment (FINT09) form completed by the appointing title insurance agent or direct operation; and
   3. a payment of the nonrefundable license application fee of $35. The fee may be paid by the applicant or the appointing title insurance agent or direct operation.
2. The appointing title insurance agent or direct operation is responsible for obtaining, maintaining, and updating the title insurance agent's escrow officers schedule bond or deposit as required under Administrative Rules L-1.II.B.5, L-1.V.B.4, L-3.II.B.4, and L-3.V.B.4.
3. The initial license application fee will not be prorated based on the expiration period of the license under Administrative Rule L-2.IV.A.
4. An appointment fee is not required for the first appointment submitted with an Application for Escrow Officer License (FINT132) form. Additional appointments submitted with the application or after the issuance of the escrow officer license require the submission of a nonrefundable $10 fee with the Escrow Officer Appointment (FINT09) form.

1. APPOINTMENT.
   1. A licensed escrow officer is not required to obtain an additional license to be employed or appointed by additional title insurance agents or direct operations.
   2. Each title insurance agent or direct operation must separately appoint the escrow officer and update and maintain the title insurance agent's escrow officers schedule bond or deposit as required under Administrative Rules L-1.V.B.4 and L-3.V.B.4.
   3. To appoint a licensed escrow officer, a title insurance agent or direct operation must complete and submit to TDI the Escrow Officer Appointment (FINT09) form with payment of the nonrefundable $10 appointment fee.
   4. Unless otherwise notified by TDI, the escrow officer may act as an escrow officer for the appointing title insurance agent or direct operation after:
      1. the second business day after the date the form is submitted to TDI through TDI's designated electronic process; or
      2. the eighth business day after the date the form is submitted to TDI by other means.
2. APPOINTMENT CANCELLATION.
   1. An escrow officer appointment only expires on the revocation, termination, or nonrenewal of the escrow officer's license, or termination of the escrow officer's employment with the title insurance agent or direct operation that made the appointment.
   2. Whenever an escrow officer ceases to act as an escrow officer or the escrow officer's employment with a title insurance agent or direct operation ends, the title insurance agent or direct operation must immediately complete and submit the Escrow Officer Appointment (FINT09) form to TDI. A copy of the completed form must be provided to the escrow officer.
   3. The appointment will be canceled by TDI on receipt of the complete Escrow Officer Appointment (FINT09) form.
   4. A title insurance agent or direct operation may remove an individual from its escrow officers schedule bond and decrease the aggregate amount of the bond, as applicable, on cancellation of that individual's escrow officer appointment.

1. EXPIRATION. Prior to February 13, 2019, licenses expire under the provisions in effect prior to the adoption of this subsection. This subsection becomes applicable to unexpired licenses on February 13, 2019.
   1. An escrow officer license expiration date will be determined as provided in Texas Insurance Code §4003.001, except that the expiration date will be extended to the last day of the individual's birth month.
      1. An extension of the license period under this paragraph will not result in an increase of any license fee.
      2. An escrow officer is not required to obtain additional continuing education during an extended license period under this paragraph.
   2. If an escrow officer license applicant has an existing license and obtains a new escrow officer license, the initial license period of the new escrow officer license will be aligned:
      1. to the existing license's expiration date; or
      2. if the initial license period of the new license is less than six months based on the alignment of the license expiration date to the existing license expiration date, TDI will use the next expected renewal date of the existing license as the expiration date for the initial period of the new license.
      3. The initial license application fee for a new license under this paragraph will not be reduced or increased based on the length of the initial license period for the new license.
      4. An escrow officer is not required to obtain additional continuing education credit hours during an extended license period under this paragraph.
   3. Notwithstanding Administrative Rule L-2.IV.A.1, unexpired escrow officer licenses held as of February 13, 2019, expire as follows:
      1. Each unexpired escrow officer license held as of that date expires on the last day of the individual escrow officer's next birth month after the expiration date of the escrow officer license with the longest remaining term held by that person on that date. Thereafter, all licenses expire in accordance with Administrative Rule L-2.IV.A.1.
      2. To the extent the term of an existing license is extended under this paragraph, TDI will not charge an additional fee or require a renewal application before the renewal date established under this paragraph.
      3. An escrow officer is not required to obtain additional continuing education during an extended license period.
2. RENEWAL. An escrow officer may renew a license that has not been revoked or surrendered, as follows:
   1. To renew the license on or before the license expiration date, the escrow officer must:
      1. complete the Escrow Officer License Renewal Application (FINT02) form;
      2. submit the form to TDI with payment of the nonrefundable license renewal fee of $35, which may be paid by the escrow officer or the appointing title insurance agent or direct operation that has appointed the escrow officer; and
      3. comply with the continuing education requirements of Procedural Rule P-28.III.A.
   2. Failure of an escrow officer to comply with Administrative Rule L-2.IV.B.1 on or before the expiration date of the license results in expiration of the escrow officer's license.
   3. If an escrow officer's license has been expired for 90 calendar days or less, the escrow officer may renew the license by complying with the license renewal requirements of Administrative Rule L‑2.IV.B.1 and submitting an additional nonrefundable late fee of $17.50, which is half the initial license application fee.
   4. If the escrow officer's license is expired for more than 90 calendar days, the license may not be renewed and all escrow officer appointments are canceled. The individual must submit a new Application for Escrow Officer License (FINT132) form and satisfy the requirements of Administrative Rule L-2.II to obtain a new license.
3. SURRENDER OF LICENSE.
   1. An escrow officer may voluntarily surrender his or her license at any time by giving written notice to TDI.
   2. The license is terminated as of the date TDI receives the written notice of the surrender.
   3. All current appointments under the license are canceled as of the date of license termination without any further required action by an appointing title insurance agent or direct operation.
   4. A title insurance agent or direct operation may remove an individual from its escrow officers schedule bond and decrease the aggregate amount of the bond, as applicable, on termination of that individual's escrow officer license.

1. An escrow officer must notify TDI using the Escrow Officer Name or Address Change Request (FINT01) form if the escrow officer's name, residential, mailing, or email address, or telephone number changes.
2. If the escrow officer's name changes, the escrow officer must notify all appointing title insurance agents and direct operations if the escrow officer's name changes.
3. If the escrow officer's name changes, all appointing title insurance agents and direct operations must adjust the escrow officers schedule bond as required under Administrative Rules L-1.V.B.4 and L-3.V.B.4.

1. ENGAGE IN BUSINESS.
   1. A title insurance company may not own or lease and operate an abstract plant or participate in a bona fide joint abstract plant operation in a county in Texas unless the company holds a license as a direct operation issued by TDI for that county.
   2. A title insurance company may not write, sign, or deliver title insurance in a county in which the title insurance company operates an abstract plant until TDI has issued a direct operation license to the title insurance company.
   3. A title insurance company licensed as a direct operation must comply with the requirements of Texas Insurance Code Chapter 2651, Subchapter C, and Chapter 2652, Subchapter C.
   4. A direct operation may not employ an individual to act as an escrow officer for the direct operation unless the individual:
      1. holds an escrow officer license issued by TDI;
      2. is covered by a surety bond or deposit as required under Texas Insurance Code Chapter 2652, Subchapter C; and
      3. is appointed under Texas Insurance Code §2652.1511 as an escrow officer by the direct operation.
2. BOOKS AND RECORDS. All books and records of the direct operation must be maintained in such a manner as to be auditable and demonstrate compliance.
3. FORMS. All of the forms referred to in this rule are available on the TDI website and on request from TDI. Forms may be submitted electronically if such submission is available.
4. TITLE PLANT. Each direct operation must maintain at all times a current and completed Abstract Plant Information T-52 (FINT120) form available for TDI inspection on request. The direct operation is not required to submit Abstract Plant Information T-52 (FINT120) form to TDI unless requested.

1. APPLICANT. An applicant for a direct operation license may not obtain more than one direct operation license for each Federal Tax Identification Number.
2. APPLICATION. An applicant for a direct operation license must complete and submit the Application for Title Insurance Agent or Direct Operation License (FINT143) form, signed by a corporate officer of the title insurance company, following all form instructions, and include:
   1. fingerprints, if required under 28 Texas Administrative Code §1.503;
   2. if the applicant will use an assumed name, a copy of a valid Assumed Name Certificate filed with the Secretary of State or County Clerk for each county in which the direct operation will operate;
   3. a Title Insurance Agent or Direct Operation Appointment (FINT10) form following all form instructions, including disclosure of counties where the applicant will operate, and attesting that the applicant:
      1. has a current Schedule D; and
      2. has an abstract plant that meets the requirements of Procedural Rule P-12 and Texas Insurance Code §2501.004, or has an abstract plant lease for each county listed on the form in which the applicant will transact business for the title insurance company;
   4. proof of bond purchase or deposit in compliance with the requirements of Texas Insurance Code Chapter 2651, Subchapter C, and Chapter 2652, Subchapter C:
      1. in the form of a completed Texas Title Insurance Agent/Direct Operation Bond (FINT122) form, a completed Texas Escrow Officers Schedule Bond (FINT123) form, a TDI cash receipt or evidence of securities approved by TDI, or a copy of an irrevocable letter of credit;
      2. with the amount of the direct operation bond or deposit being the greater of:
         1. $10,000; or
         2. an amount equal to 10 percent of the gross premium written by the direct operation in accordance with the latest statistical report to TDI but not to exceed $100,000;
      3. with the aggregate amount of the escrow officer bond or deposit, up to a maximum of $50,000, determined by multiplying the number of employed and appointed escrow officers by:
         1. $5,000 for each individual who is a bona fide Texas resident; and
         2. $10,000 for each individual who is a bona fide resident of a state adjacent to Texas; and
      4. listing each escrow officer employed and appointed by the direct operation on the bond schedule;
   5. a list of all branch office addresses and telephone numbers; and
   6. a nonrefundable application fee of $50.

1. APPOINTMENT.
   1. A title insurance company may appoint a direct operation by submitting the required nonrefundable $16 appointment fee with the Title Insurance Agent or Direct Operation Appointment (FINT10) form completed by the title insurance company's appointing official, following all form instructions, and attesting that the applicant:
      1. has a current Schedule D;
      2. has an agency contract with the title insurance company; and
      3. has an abstract plant that meets the requirements of Procedural Rule P-12 and Texas Insurance Code §2501.004, or has an abstract plant lease for each county listed on the form in which the direct operation is appointed to transact business for the title insurance company.
   2. The appointment is effective on the eighth business day following the date the notice of appointment is complete and TDI receives the appointment fee, unless TDI notified the title insurance company that the appointment was rejected. The notice of appointment is complete when TDI receives a complete Title Insurance Agent or Direct Operation Appointment (FINT10) form and the required fee.
   3. A direct operation may be appointed by multiple title insurance companies for each county.
   4. Direct operation appointments do not expire and remain effective until terminated.
2. APPOINTMENT MAINTENANCE.
   1. After the direct operation has been appointed, the title insurance company may add or remove counties from the appointment by submitting the Title Insurance Agent or Direct Operation Appointment (FINT10) form completed by the title insurance company's appointing official, following all form instructions to list any counties to be added or deleted, and attesting that the applicant:
      1. has a current Schedule D;
      2. has an agency contract with the title insurance company; and
      3. has an abstract plant that meets the requirements of Procedural Rule P-12 and Texas Insurance Code §2501.004, or has an abstract plant lease for each county listed on the form in which the direct operation is appointed to transact business for the title insurance company.
   2. A direct operation may not operate in an additional county on behalf of a title insurance company until the earlier of:
      1. the eighth business day following the date the complete Title Insurance Agent or Direct Operation Appointment (FINT10) form is submitted, unless TDI has notified the title insurance company that the appointment has been rejected; or
      2. when TDI's website reflects the additional counties.
3. APPOINTMENT TERMINATION.
   1. Termination of an appointment terminates the direct operation's authorization to write for the title insurance company in Texas.
   2. Deletion of all counties from an appointment terminates the appointment.
   3. Either the direct operation or title insurance company may terminate the appointment as follows:
      1. If a title insurance company intends to terminate a direct operation's appointment, the title insurance company must give the direct operation 30 calendar days' written notice of termination before the effective date of the termination, unless the direct operation is terminated for cause, as defined in the agency agreement. The title insurance company must submit the Title Insurance Agent or Direct Operation Appointment (FINT10) form to TDI within three business days of notifying the direct operation of the termination. The notice must state the effective date of the termination. If the title insurance company terminates the appointment for cause, the title insurance company must submit an explanation of the circumstances with each notice.
      2. If a direct operation intends to terminate the direct operation's appointment, the direct operation must give the title insurance company 30 calendar days' written notice of the termination. The direct operation must notify TDI of the termination in writing within three business days of notifying the title insurance company of the termination. Each notice must state the effective date of the termination.

1. EXPIRATION. A direct operation's license expires two years after the date of issuance.
2. RENEWAL. A direct operation may renew its license as follows:
   1. To renew a direct operation license, on or before the expiration date of the license, the direct operation must submit the following:
      1. the Title Insurance Agent or Direct Operation Renewal Application (FINT03) form following all the instructions; and
      2. a nonrefundable renewal application fee of $35.
   2. Failure of a direct operation to submit a complete renewal application and the required renewal fee on or before the expiration date of the license results in expiration of the direct operation's license.
   3. If a direct operation's license is expired for 90 calendar days or less, the direct operation may renew the license by complying with Administrative Rule L-3.IV.B.1 and submitting an additional nonrefundable fee in the amount of $25, which is half the initial license application fee.
   4. If a direct operation's license is expired for more than 90 calendar days, the license may not be renewed, and any title insurance company appointments and all escrow officer appointments terminate. The applicant must submit a new Application for Title Insurance Agent or Direct Operation License (FINT143) form and satisfy the requirements of Administrative Rule L-3.II to obtain a new direct operation license. New escrow officer appointments must be submitted prior to engaging in the business of a direct operation.
3. SURRENDER OF LICENSE. A direct operation may voluntarily surrender a license at any time. The direct operation must notify TDI and any title insurance company that appointed the direct operation of the surrender not less than 45 calendar days before the effective date of the surrender. The direct operation's notice to TDI must include:
   1. written notification that the direct operation is ceasing operations, including the effective date of surrender for the direct operation's license; and
   2. the direct operation's current plan for an orderly winding down of its operations and compliance with Administrative Rule D-1.

1. NEW LICENSE REQUIRED.
   1. If a direct operation's license is expired, surrendered, or revoked, and a new license is required, the direct operation license applicant may not conduct the business of a direct operation until the applicant has been notified by TDI that its direct operation license has been issued.
   2. A direct operation license is non-transferrable. The purchase of a direct operation's assets cannot include the transfer of the direct operation license. The purchase of a title insurance company’s stock is not considered a transfer of an associated direct operation’s license.
2. NEW LICENSE NOT REQUIRED. The following changes in the operations of a direct operation only require written notice to TDI, as provided below, unless the direct operation is required to apply for a new license under Administrative Rule L-3.V.A.
   1. A Title Insurance Agent or Direct Operation Change Request (FINT129) form, with the information specified below, is required for:
      1. all mergers, exchanges, and conversions, prior to the transaction, and must include a copy of any other notice or statement required to be filed with TDI and the effective date of the transaction;
      2. a change of the direct operation's name or assumed name, including the use of additional assumed names or the abandonment of an assumed name, and must include:
         1. if the entity name changes, a certified copy of the amended Certificate of Formation reflecting the entity name as amended, and
         2. if an assumed name is used, a copy of a valid Assumed Name Certificate filed with the Secretary of State and County Clerk in each county in which the direct operation will operate;
         3. however, a new name may not be used until the direct operation has been notified by TDI that the license has been updated with the new name;
      3. a change in the direct operation's primary or branch office physical or mailing address, and must include written notification of the new address.
   2. A Title Insurance Licensing Biographical Information (FINT08) form is required for each new designated on-site manager of the direct operation.
   3. Changes in the direct operation's title plant ownership or lease must be documented in the direct operation's records and made available to TDI on request.
   4. Changes in the proof of the bond or deposit requirements of Texas Insurance Code Chapter 2651, Subchapter C, and Chapter 2652, Subchapter C, including the new or amended TDI cash receipt, copy of the surety bond, copy of the irrevocable letters of credit, or copies of securities approved by TDI, must be documented in the direct operation's records and made available to TDI on request.
   5. A Title Insurance Agent or Direct Operation Appointment (FINT10) form is required if:
      1. the direct operation will write, sign, or deliver title insurance in a new county, and must include an attestation that the direct operation:
         1. has a current Schedule D; and
         2. has an abstract plant that meets the requirements of Procedural Rule P-12 and Texas Insurance Code §2501.004, or has an abstract plant lease for each county listed on the form in which the applicant will transact business for the title insurance company; or
      2. the direct operation will no longer write, sign, or deliver title insurance in a county.

The Agent/Direct Operation must provide written notice of its intent to cease operations no later than forty-five (45) days prior to its final date of operation to:

1. the Department, addressed to the Texas Department of Insurance, Title Division, Post Office Box 149104, Austin, Texas 78714-9104;
2. all Title Insurance Companies for which the Title Agent/Direct Operation holds an appointment and is currently licensed; and
3. the Public, by public announcement in a local publication of general circulation.

1. The Agent/Direct Operation and Company must conduct a final audit of the Agent's/Direct Operation's trust fund accounts, the records pertaining thereto and the unused forms in Agent's/Direct Operation's possession, pursuant to the requirements of Texas Insurance Code §§2651.151-157 and 2651.251-253.
2. The Agent/Direct Operation must provide a final accounting of all funds held in its escrow account for the State of Texas Policy Guaranty Fees and Recoupment Charge funds. Such final accounting together with a final disbursement of any due funds shall be made to the Texas Title Insurance Guaranty Association c/o General Counsel for the Texas Title Insurance Guaranty Association, 301 Congress, Suite 800, Austin, Texas 78701.
3. The final audit and final accounting required by this section must be delivered to the Department within 90 days after an Agent's/Direct Operation's surrender of its license. If an Agent/Direct Operation fails to complete and submit such audit and accounting, it shall be the responsibility of the respective Companies to use their best efforts to complete and submit such final audits and accountings to the Department. A copy of the final audit shall also be sent to each title insurance company that the agent represents. If a title insurance company fails to receive a final audit report within 90 days of the date of the license surrender, the company shall (1) report that failure to the Department not later than the 100th day after the date of the license surrender and (2) use its best efforts to complete and submit a final audit and/or accounting to the Department within 150 days of the date of surrender of the license.

   A Company must provide written explanation and justification to the Department documenting those portions of the final audit and/or accounting that the Company was not able to complete; including the records and personnel available to the company and the efforts the Company used in its attempt to fully complete the final audit and/or final accounting as required under this section.

   Each title insurance agent operating in Texas shall prepare a plan for winding down the title agent's operations by the Company should the title insurance agent fail to wind down its own operations, including the title insurance agent's immediate cessation of business due to title insurance agent or Company action. The title insurance agent's plan must provide at a minimum the following:

   1. The storage of each Company's guaranty files in one location for a period of at least ninety (90) days so that a final audit and final accounting may be conducted. Each Company shall have access to its own guaranty files and the independent auditors shall have access to all guaranty files. After the final audit and final accounting are conducted under this section, each Company shall obtain and store its own guaranty files.
   2. Authorization to each Company to obtain all books, bank statements, associated accounting files and bank records relative to the Company's trust accounts.
   3. Authorization to each Company to access its trust accounts.

   The title insurance agent's plan and authorization must be furnished to each Company and the Department. The title insurance agent's plan must be reviewed by the title insurance agent annually and updated as necessary. The title insurance agent's plan shall be implemented by the Company immediately upon receipt of written notification by the Department that the Department has determined that the title agent has failed to wind down its own operations.

4. The expenses of such final audit and accounting shall be borne by the respective Company(ies) in proportion to their share of premiums for the twelve month period immediately preceding the date of final audit and accounting.

1. The Agent/Direct Operation must surrender all files, together with a list of all pending files and outstanding commitments, to the appropriate Companies. The Agent/Direct Operation must send written notice to all interested parties in pending transactions that the appropriate Companies have custody and control of such files. Such notice to interested parties shall be provided on a Notice of Cessation Form Ti-100, no later than forty-five (45) days prior to its final date of operation, with a copy sent to the appropriate Company and a copy retained in the appropriate guaranty file.
2. The Agent/Direct Operation shall transfer all escrow accounts and investment accounts, which have not been fully disbursed, to the appropriate Companies for the benefit of the parties to pending transactions and the general public. Such transfer shall include a listing of the sources of all transferred funds, and a list of pending transactions. A copy of such list of pending transactions shall be provided to the Department.

Pursuant to Texas Insurance Code §§2652.201-202 the licenses of any Escrow Officers employed by an Agent/Direct Operation ceasing business shall be automatically cancelled.

The provisions of this Administrative Rule shall be in addition to and cumulative of any other notice provisions found in Sec. VI Administrative Rules of the Basic Manual of Rules, Rates, and Forms for the Writing of Title Insurance in the State of Texas.

1. "Association" means the Texas Title Insurance Guaranty Association.
2. "Board" means the Board of Directors of the Association.
3. "Policy Guaranty Fee" means that sum of money established by the Board pursuant to Texas Insurance Code §§2602.151-154, which is required to be remitted to the Association upon the issuance of each owner's policy and each loan policy of title insurance issued in the State of Texas in accordance with the procedures as set forth in these administrative rules.

1. Each policy guaranty fee shall be collected directly from the purchaser of each owner's and loan policy at the closing of the transaction and such itemized charge shall be disclosed on the settlement statement and designated thereon "State of Texas Policy Guaranty Fee." Upon collection of the premium for each owner's and loan policy of title insurance, the issuing Title Insurance Agent/Direct Operation, or if no Agent/Direct Operation actually issues, the issuing Title Insurance Company shall forthwith deposit all policy guaranty fees in the amount determined by the Board into an audited escrow or trust account.

   Each issuing Agent/Direct Operation or issuing Company is responsible for the actual remittance of these fees to the Association.

2. No Title Insurance Agent/Direct Operation or Title Insurance Company may utilize the policy guaranty fees so maintained for any purpose other than the actual payment of all policy guaranty fees to the Association quarterly. The schedule of remittance is as follows:

   Calendar Quarter Ending	Remittance Due Date
   March 31	May 1
   June 30	August 1
   September 30	November 1
   December 31	February 1

3. Each Title Insurance Agent/Direct Operation shall report and remit the fees for all of its offices on a single remittance form and payment. Permissible methods of payment include check, wire transfer, certified check, cashier's check, or money order.
4. The remitting Title Insurance Agent/Direct Operation or Title Insurance Company shall maintain records reflecting the quarterly policy count. No policy guaranty fee shall be reported to the Texas Department of Insurance as an expense of operation for the purpose of establishing title insurance rates.
5. All remittances shall be addressed to the designated address of the Association and shall be accompanied by a completed Policy Guaranty Fee Remittance Form. If no closings occurred during the quarter and no policy guaranty fees were received, the form must be sent in with the amount of "0." All remittances must be postmarked on or before the remittance due date.

1. "Audit and review of Agent/Direct Operation escrow and trust accounts" includes auditing of escrow and trust accounts, auditing of statistical reports, auditing of all other accounting records and review of complaints relating to Agents/Direct Operations.
2. "Escrow and trust accounts" includes those accounts which are subject to annual audit pursuant to Texas Insurance Code §§2651.151-157.

Upon the request of the Commissioner of Insurance, the Board will authorize expenditure of funds from the guaranty fee account to retain, compensate and reimburse for reasonable and necessary expenses persons who will audit and review Agent/Direct Operation escrow and trust accounts. Such persons shall act solely under the direction of the Commissioner of Insurance, or his designee and make such reports as are required.