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Texas Department of Insurance
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How TDI Regulates and Oversees Title Insurance Agents

Statutory and Regulatory Framework

The Texas Department of Insurance regulates the business of title insurance on real property and on personal property to

  • protect consumers; and
  • provide adequate and reasonable rates of return for title insurance companies and title insurance agents.

TDI does this by:

TDI regulates title insurance under Texas Insurance Code, Title 11 and the Basic Manual of Rules, Rates and Forms for the Writing of Title Insurance in the State of Texas.

Links to each section of the Basic Manual:

Section I – Insurance Code

Section II – Insuring Forms

Section III – Rate Rules

Section IV – Procedural Rules

Section V – Exhibits and Forms

Section VI – Administrative Rules

Section VII – Claims

Section VII – Personal Property Title Insurance

Appendix – Bulletins


All title agents licensed in Texas are subject to three separate audit requirements:

  1. annual CPA audit of the agent’s trust fund accounts,
  2. policy audit conducted by the title agent’s underwriters at least once every two years, and
  3. compliance audits conducted by TDI approximately once every two years.
  1. Annual Trust Fund Audit: Every title agent must have an annual audit of all trust fund accounts completed within 90 days of the end of the agent’s fiscal year. See TIC §2651.151. Outside CPAs prepare the reports using forms and instructions promulgated by TDI, in Basic Manual, Section V. The agent must submit copies of the annual audit to TDI and to each of the title agent’s underwriters. Part of the audit is checking to see if the title agent has followed required accounting procedures outlined in the Basic Manual, Specific Areas and Procedures. TDI auditors review all annual trust fund account audit reports for completeness and warning signs.

  2. Policy Audit: At least once every two years each of a title agent’s underwriters must audit the policies written. See TIC §2651.253. The underwriters must determine that all policies written have been properly reported. Agents or underwriters must submit the policy audit report to TDI.

  3. TDI Compliance Audits: Insurance Code Section 2602.103 grants authority for TDI auditors to conduct compliance audits of title agents. (Reports for compliance audits conducted under Section 2602.103 are confidential and not available to the public.)

Title Auditor’s Notebook

The auditor’s notebook contains guidance on rules and statutes, detailed instructions, and worksheets to assist auditors in examining title agents.

Quarterly audit reports (titled Texas Title Insurance Guaranty Association Quarterly Reports):

Audit reports include:

  • the number of audits completed,
  • recent enforcement cases and orders, and
  • the number and type of violations found during audits.

TDI compliance audits cover the following areas:

  1. Abstract plant testing: Abstract plants are tested for currentness and completeness by selecting a sample of test instruments from the official county records. Auditors make sure that the abstract plant contains “fully indexed records showing all instruments of record affecting lands within the county for a period beginning not later than January 1, 1979.” Basic Manual, P-12, P-12 also requires that agents maintain records of the abstract plant to the current date.

  2. Escrow accounting: TDI audits escrow accounts to ensure that all escrow funds are accounted for and proper controls are in place to detect and timely correct any shortages. Auditors ensure that all escrow funds are being handled only by licensed escrow officers. The agent’s recent three-way reconciliations are reviewed for timeliness, accuracy, and unusual items (for more information, see the Basics of Escrow Accounting). Auditors pay special attention to the deposit-in-transit entries to make sure that they are all valid and that false entries have not been used to cover up escrow shortages. To confirm that the agency records match up with the bank’s records, the auditor sends to the bank a Bank Balance Confirmation form signed by the agent.

  3. Guaranty files: Auditors select a sample of the title agent’s closed guaranty files to make sure that escrow transactions are funded with “good funds.” See TIC, §2651.202; Basic Manual, P-27. The auditor reviews the file documents to ensure that all disbursements are made according to the signed settlement statement, and makes sure that proper invoice support is maintained for all disbursements. See TIC, §2702.053, The auditor also determines that proper premium amounts were charged, no unauthorized fees were charged, no overcharges were made, and all required disclosures were properly made.

  4. Operating accounts: Audits also include a review of the agent’s operating accounts and financial condition. The auditor reviews agency financial statements to determine if the agent is solvent. The agent’s tax return can be used if no financials are available. The auditor checks operating account bank statements for overdrawn conditions or bounced checks, and premium remittances to see if the underwriters are paid timely. Auditors also make sure the agents are complying with the minimum capitalization requirements in Basic Manual, Section VI.

  5. Other areas: Auditors check to make sure

    • the title agent maintains proper bond coverage, TIC §§2651.101 and 2652.101;
    • all agency escrow officers meet the continuing education requirements, TIC §2652.058, Basic Manual, P-28;
    • that the quarterly payroll tax information is submitted to TDI each quarter, Basic Manual, S.5; and
    • the agent has submitted a wind-down plan to TDI, Basic Manual, D-1.


Lists of all active title agents and escrow officers are on TDI’s website:

To engage in the business of title insurance in a particular county, a title agent must:

  1. be issued a license under Basic Manual, L-1.I. and comply with the requirements for maintaining that license in an active status,
  2. possess a valid, active appointment for that county from a title insurance company's appointing official, and
  3. own or lease, and control an abstract plant, or participate in a bona fide joint abstract plant operation.

Title agents submit all title agent and escrow officer applications and renewals to TDI.

Any escrow officer who has not had an active escrow license within 60 days of the date TDI receives the application is required to submit fingerprints for a background report from Texas Department of Public Safety and the FBI. 28 TAC §1.503, §1.504.

Management TDI collects background information on all owners, officers, managers, partners, and directors during the initial title agency application process and whenever ownership or management changes. Applicants provide employment history and answer questions about criminal history.

New title managers have one year to take a professional training course for title agent management personnel if they have not taken it before becoming an on-site manager, or did not previously have five years’ experience as a Texas title agency manager. The course must comply with Basic Manual, P-28.B.5.

  1. Unencumbered Assets – Balance Sheet Requirement
    Insurance Code Sections 2651.002(c)(2) and 2651.012 require title agents to maintain a specified amount of unencumbered assets in excess of liabilities. Title agents may demonstrate that they comply with this requirement by submitting a balance sheet or other acceptable evidence when they submit their new or renewal license application.

  2. Franchise Tax Account Status
    When an entity submits an application for a new or renewal license, the entity must verify its Franchise Tax Account Status by submitting a current printout of its Franchise Tax Account Status page from the Texas State Comptroller’s Office website, See Basic Manual, L-1.I.C.5. and L-1.IV.D.3.

  3. Federal Employee ID Number (FEIN) Verification
    Title agents must verify their correct FEIN number by submitting a copy of the SS-4 letter from the IRS with all licensing packages.

  4. Management Personnel
    The following people qualify as management personnel who are required to comply with Basic Manual, P-28.B.3 by taking a professional training course for title agent management personnel:

    1. designated managers performing day-to-day operations,
    2. any owners, officers, directors, or partners owning 10% or more of the title agent, and
    3. if an entity owns 10% or more of the title agent, the entity’s officers, directors, or partners.
  5. Work History
    To qualify for an exemption from professional management training requirements, management personnel may submit a resume or detailed work history demonstrating that they have held a position as title agent management personnel in Texas for at least five years. See Basic Manual, P-28.B.4.

Continuing Education

Each active partner owning 10% or more of a title agent, and each sole proprietor, is required to take 10 hours of continuing education during the two-year renewal period. See Basic Manual, P-28.B.

For renewal, a licensee must complete continuing education on a prorated schedule for each reporting period. The number of required credit hours are based on the reporting period from the issue date of the original license or the most recent renewal date, according to the following schedule for all licenses renewing on or after September 30, 2013.

License period Total required hours Ethics
Less than 4 months 0 0
4 months up to and including 6 months 4 0
7 months up to and including 9 months 5 0
10 months up to and including 12 months 6 1
13 months up to and including 15 months 7 1
16 months up to and including 18 months 8 1
19 months up to and including 21 months 9 1
22 months or more 10 1

License Renewals

Escrow Officers:

When renewing escrow officer licenses, escrow officers must verify that they have met the continuing education requirements by submitting copies of the course completion certificates. The escrow officer must keep the original for four years. Basic Manual, P-28.A.12.

All escrow officers licensed for at least 10 months must complete six or more hours of continuing education, depending on the length of time licensed. Basic Manual, P-28.A.3. Those hours must include at least one hour of ethics. Courses to meet the Ethics requirements must be accredited by either TDI or the State Bar of Texas.

Title Agent:

A title agent's license expires two years after the date of issuance.

To renew any license, on or before the expiration date of the license, the title agent must submit to TDI the following:

  1. renewal application,
  2. non-refundable renewal fee of $35.00,
  3. a printed copy of the webpage displaying the title agent's Franchise Tax Account Status, available on the Texas Comptroller of Public Accounts' website at, and
  4. a current Franchise Tax Public Information Report on file with the Texas Comptroller of Public Accounts.

For additional information, review the Administrative Rules in the Basic Manual

  • For Title Agents, see rule L-1.
  • For Escrow Officers, see rule L-2.
  • For Direct Operations (underwriters), see rule L-3.

Statistical Reports

Title agents and underwriters must annually submit statistical reports that TDI can use to set premium rates, including data on

  1. income;
  2. loss;
  3. expense of operation; and
  4. other material matters.

See TIC §2703.153; Basic Manual, Texas Title Agent Statistical Plan.

TDI publishes the results of these reports in the Texas Title Insurance Agent Experience Report Compilation and the Texas Title Insurance Industry Experience Report Compilation.

Consumer Protection

Anyone with a complaint about a Texas title agent may file a complaint with TDI. TDI investigates all complaints and works with title agents and complainants to resolve the issues. Complaints may be sent to Enforcement for further action.

More information about TDI’s complaint process


Consumers, title agents and underwriters, and escrow officers are encouraged to report potential violations to TDI. TDI’s consumer complaint unit investigates these allegations and in turn transfers them to our enforcement or fraud units as warranted.

TDI’s enforcement team may take disciplinary action against title agents who fail to follow TDI rules and statutes. Non-compliance may result in disciplinary action including revocation of the agent license, issuance of a cease and desist order, imposition of an administrative penalty, and ordering restitution.

News releases and enforcement actions


TDI’s fraud unit investigates potential criminal activity. The unit's responsibilities include receiving and reviewing reports of fraud, initiating inquiries, and conducting investigations when TDI has reason to suspect insurance fraud. In addition, the unit actively seeks criminal indictments, makes arrests, and assists in prosecutions to deter insurance fraud in Texas.

The unit investigates allegations such as schemes against consumers, individuals not properly licensed to do business in Texas, as well as internal complaints such as misuse of company funds and submission of falsified financial statements.

More information about TDI’s fraud unit

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For more information, contact:

Last updated: 2/6/2024