Escrow & TitleIntermediateArizona Exam

Arizona's title insurance market is regulated to ensure that title insurance companies:

ACharge uniform premium rates set by the Arizona Department of Insurance and apply the same rate schedule to all buyers and lenders regardless of property type or location

BMaintain adequate reserves, file rates and forms with the state, and remain financially solvent to pay claimsCorrect

CProvide title insurance to all qualified buyers in Arizona at no cost, with the premium paid entirely by the state's title guaranty fund at the time of closing

DWork exclusively with escrow companies that are affiliated with or approved by the title insurer's parent holding company under Arizona's controlled business arrangement rules

Why Maintain adequate reserves, file rates and forms with the state, and remain financially solvent to pay claims Is Correct

Answer B: Maintain adequate reserves, file rates and forms with the state, and remain financially solvent to pay claims

The Arizona Department of Insurance regulates title insurance companies to ensure they maintain adequate financial reserves, file rates and forms for regulatory approval, and remain solvent to pay valid claims.

Exam Tip: Escrow & Title

Escrow questions test the neutral third-party role and the sequence of closing events. Remember that the escrow agent acts as a dual agent for both buyer and seller and cannot advocate for either side.

Key Escrow & Title Terms in This Question

Title Insurance

Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.

Escrow

A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.

People Also Study

Key Terms to Know

Title Insurance

Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.

Escrow

A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.

Deed

A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).

Easement

A non-possessory right to use another person's land for a specific purpose.

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