XBox: I used to work for a large insurance brokerage, Willis Corroon, and we wrote surety and insurance for FATCO (First American Title) and Chicago Title.

At first blush, I would imagine a loss like this would be covered by either their general or professional liability (Errors and Omissions) policy, depending on how the loss occurred. Or it would be covered under one of their surety programs, and by something like a fidelity bond or a financial guarantee bond. Can’t recall ever coming across something like this, but both FATCO and Chicago Title had extremely robust risk management, loss and insurance programs (which you’d expect, given the nature of their business).

Probably doesn’t answer your question, but I thought I’d take a whack at it.

XBox: I used to work for a large insurance brokerage, Willis Corroon, and we wrote surety and insurance for FATCO (First American Title) and Chicago Title.

At first blush, I would imagine a loss like this would be covered by either their general or professional liability (Errors and Omissions) policy, depending on how the loss occurred. Or it would be covered under one of their surety programs, and by something like a fidelity bond or a financial guarantee bond. Can’t recall ever coming across something like this, but both FATCO and Chicago Title had extremely robust risk management, loss and insurance programs (which you’d expect, given the nature of their business).

Probably doesn’t answer your question, but I thought I’d take a whack at it.

I do not know what is required for insurance however, typically the cash is insured by what Allan mentioned. I used to be a 1031 consultant and our fidelity bond was $10M for each occurrence and our E&O was 3M. This is a different scenario but i have found 1031 accomodators and escrows tend to read from the same playbook.

On the other side of that, I had a real estate instructor who described a situation where one of his deals died because the escrow imploded mid transaction. He was able to get the funds out but the deal was not salvageable. The greater difficulty and uncertainty I think is, first that the company (as opposed to the bank) goes bust and stops returning calls, and second, that (whether the failure is by the bank or escrow firm) that the client and/or the agent would have to locate and follow with the insurance company.

I do not know what is required for insurance however, typically the cash is insured by what Allan mentioned. I used to be a 1031 consultant and our fidelity bond was $10M for each occurrence and our E&O was 3M. This is a different scenario but i have found 1031 accomodators and escrows tend to read from the same playbook.

On the other side of that, I had a real estate instructor who described a situation where one of his deals died because the escrow imploded mid transaction. He was able to get the funds out but the deal was not salvageable. The greater difficulty and uncertainty I think is, first that the company (as opposed to the bank) goes bust and stops returning calls, and second, that (whether the failure is by the bank or escrow firm) that the client and/or the agent would have to locate and follow with the insurance company.

I do not know what is required for insurance however, typically the cash is insured by what Allan mentioned. I used to be a 1031 consultant and our fidelity bond was $10M for each occurrence and our E&O was 3M. This is a different scenario but i have found 1031 accomodators and escrows tend to read from the same playbook.

On the other side of that, I had a real estate instructor who described a situation where one of his deals died because the escrow imploded mid transaction. He was able to get the funds out but the deal was not salvageable. The greater difficulty and uncertainty I think is, first that the company (as opposed to the bank) goes bust and stops returning calls, and second, that (whether the failure is by the bank or escrow firm) that the client and/or the agent would have to locate and follow with the insurance company.