SECTIONS 12640.12-12640.15 - California Statutes

INSURANCE CODE

SECTION 12640.12-12640.15

12640.12. Every mortgage guaranty insurer shall adopt, print and
make available a schedule of premium charges for mortgage guaranty
insurance policies. The schedule shall show the entire amount of
premium charge for each type of mortgage guaranty insurance policy
issued by the insurer.

12640.13. (a) No mortgage guaranty insurer shall pay to any person
who is acting as agent, representative, attorney or employee of the
owner, mortgagee of the prospective owner, or mortgagee of the real
property or any interest therein, either directly or indirectly, any
commission, or any part of its premium charges or any other
consideration as an inducement for or as compensation on any mortgage
guaranty insurance business.
(b) Notwithstanding subdivision (a), or the provisions of Section
751, activities of mortgage guaranty insurers in dealing with the
secondary mortgage market, which are made available to the mortgage
lending industry, whether insureds or not, shall not be deemed to be
unlawful rebates or commissions. Included, but not limited to such
activities, are the following:
(1) Services provided for the purpose of assisting in the purchase
or sale of mortgage loans in the secondary market.
(2) Preparation of forms necessary for the sale of mortgage loans
in the secondary mortgage market.
(3) Educational seminars dealing with issues affecting the
mortgage lending industry.

12640.14. No mortgage guaranty insurer shall make any rebate of any
portion of the premium charge shown by the schedule required by
Section 12640.12. No mortgage guaranty insurer shall quote any
premium charge to any person which is less than that currently
available to others for the same type of mortgage guaranty insurance
policy. The amount by which any premium charge is less than that
called for by the current schedule of premium charges is an unlawful
rebate.

12640.145. No mortgage guaranty insurer shall pay any compensation
to any person for transacting insurance for or with it based in whole
or in part upon a commission basis unless such person is licensed
pursuant to and subject to all the provisions of and restrictions in
Chapter 5, Part 2, Division 1 of this code. This section shall not be
construed so as to affect the meaning of any other provisions of
this article.

12640.15. The commissioner may after a hearing suspend or revoke
the certificate of authority of any mortgage guaranty insurer which,
after 10 days written notice from the commissioner requiring it to
cease and desist, continues to pay any commission or to make any
unlawful rebate in willful violation of the provisions of this
article (commencing with Section 12640.12). The hearings of the
commissioner shall be conducted in accordance with the Administrative
Procedure Act, Chapter 5, Part 1, Division 3, Title 2 of the
Government Code, and the commissioner shall have all the powers
granted therein.