You asked whether (1) the Connecticut Attorneys Title Insurance Company (CATIC) is subject to Connecticut taxes and, if not, why not and (2) the company has a partnership with for-profit title insurance companies in other states and, if so, if it violates state law or the company’s charter.

CATIC is not exempt from Connecticut taxes. According to Michael Galliher of the Department of Revenue Services, the company is registered and pays the insurance premium tax. This is a 1. 75% tax on total net direct premiums received from policies written on property or risks within the state. Insurance companies doing business in Connecticut pay the insurance premium tax instead of the corporation tax.

According to Rich Hogan, CATIC’s government relations representative, CATIC has formed an alliance with two other title insurers, Attorneys Title Insurance Fund (The Fund) and United General Title Insurance (UGT). CATIC is not-for-profit and is present in the New England region. The Fund is also a not-for-profit company and is present in the southwest. United General is for-profit and is present nationally, outside of New England. The three companies created a joint venture called RealAlliance LLC. Hogan told us that the purpose of RealAlliance is to provide a national web-based referral network of title agents so that their independent title agents can compete more favorably against large national companies. Each of the three companies funded one-third of the venture. The company does not charge fees and is not designed to make money. Hogan said the arrangement does not violate CATIC's charter. He also noted that the Connecticut Insurance Department is aware of the venture.

For your additional information, we attach an October 23, 2002 press release announcing the transaction.

JL: nf