PURPOSE: This rule defines terms and explains usage rules for those terms used in this chapter. This regulation implements section 379.010, RSMo.

1. (1) As used in this chapter—

   1. (A) Authorized real estate security means an amortized note bond or other evidence of indebtedness, not exceeding one hundred percent (100%) of the fair market value of the real estate, secured by a mortgage, deed of trust or other instrument constituting a first lien or charge on real estate, provided—

      1. 1. The real estate loan secured in that

manner is one authorized to be made by a bank, savings and loan association or an insurance company, which entity is supervised and regulated by a department of this state or an agency of the federal government; however, in the case of residential real estate loans only, the list of entities in this paragraph shall include mortgage bankers and mortgage brokers supervised and regulated by a department of this state or an agency of the federal government; or

1. 2. The lien on that real estate may be

subject and subordinate to the following:

1. A. The lien of any public bond,

assessment or tax, when no installment, call or payment of or under the bond, assessment or tax is delinquent; or

1. B. Outstanding mineral, oil or timber

rights, rights-of-way, easements or rights-ofway or support, sewer rights, building restrictions or other restrictions or covenants, conditions or regulations of use or outstanding leases upon real property under which rents or profits are reserved to the owner;

1. (B) Contingency reserve means an additional premium reserve established for the protection of policyholders against the effect of adverse economic cycles;
2. (C) Director means the director of insurance, state of Missouri;

3. (D) Mortgage guaranty insurance means—

   1. 1. Insurance against financial loss by

reason of nonpayment of principal, interest and other sums agreed to be paid under the terms of any note or bond or other evidence of indebtedness secured by a mortgage, deed of trust or other instrument constituting a lien or charge on real estate or on an owner-occupied mobile home; or

1. 2. Insurance against financial loss by

reason of nonpayment of rent and other sums agreed to be paid under the terms of a written lease for the possession, use or occupancy of real estate provided the improvement on that real estate includes a building(s); and

1. (E) Policyholders’ surplus means the aggregate of capital, surplus and contingency reserve.

AUTHORITY: section 374.045, RSMo Supp. 1999.* Original rule filed April 11, 1996, effective Nov. 30, 1996. Amended: Filed Aug. 31, 2000, effective April 30, 2001. *Original authority: 374.045, RSMo 1967, amended 1993, 1995.