Administrative Rule Review Report  AR07-058

Legislative Service Office

23-Oct-07

AGENCY: Wyoming Real Estate Commission

DATE SUBMITTED: October 15, 2007.

SUBJECT: Chapter II, Sections 3, 4 and 14, Real Estate Commission and Chapter III, Errors and Omissions Insurance

NATURE OF RULES:                     Legislative, procedural

STATUTORY AUTHORITY:         W.S. 33-28-105, 33-28-401

DETERMINATION OF PROCEDURAL COMPLIANCE BASED UPON INFORMATION

SUBMITTED BY THE AGENCY TO LSO:  Apparently complete to date.

SUMMARY OF RULES:  These rules are promulgated primarily in response to 2007 Wyo. Sess. Laws, Chapter 95 (Senate File 139), which requires real estate licensees to obtain errors and omissions insurance through a group policy procured by the Commission or through an independent source.  Chapter III of the rules is created to govern this issue.  The rules require each active licensee to submit proof of insurance coverage through the group plan or through certification of equivalent coverage.  The rules establish the minimum standards of coverage for the group policy obtained by the commission.  The rules establish the types of claims that may be limited or excluded by the insurance coverage.  The rules provide that any group policy must conform to the standards and practices of the insurance industry and be approved by the Wyoming insurance department.  The rules also establish the standards that coverage must meet if it is obtained independent of the group carrier under contract with the commission.  The rules provide that a licensee who is placed on inactive status for failure to provide proof of insurance shall immediately surrender the license and that proof of insurance is required to activate the license.

Chapter II of the Real Estate Commission rules and regulations is amended to define "short term rental" as a rental of real property for 31 days or less.  The rules are also amended to conform to the new requirement for each real estate salesman, real estate broker and associate broker applicant to submit proof of errors and omissions insurance.  The rules are amended to provide that the commission may take disciplinary action against a licensee for failing to obtain and maintain errors and omissions insurance and for compensating any unlicensed person for performing the services of a broker, associate broker or salesman except where the unlicensed person is arranging short term rentals.

A new rule letter was sent to the members of the Corporations, Elections and Political Subdivisions Interim Committee on October 19, 2007.

FINDINGS:  The rules appear to be within the scope of statutory authority and legislative intent.

TECHNICAL NOTES for agency:

Chapter III, Section 9(a)(iv) it appears the reference to "subsection (iii) of this section" should be "paragraph (a)(iii) of this section".

Chapter III, Section 9(a)(iv) – the following subparagraphs should be "(A), (B) and (C)" rather than "(i), (ii) and (iii)" as provided by the Secretary of State's rules on rules and in conformance with the remainder of the rules.

STAFF RECOMMENDATION:  That the rules be placed on the Consent List and be approved by the Council as submitted by the Agency.

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Joshua Anderson

Research Associate

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David K. Gruver

Assistant Director