First American Spatial Solutions Receives Risk Location System Verification
—Accurate, Detailed Premium Tax Database Supports Correct Billing and Reduces Compliance Liabilities—
July 21, 2009, AUSTIN, Texas
First American Spatial Solutions, a member of The First American Corporation (NYSE: FAF) family of companies and a leader in spatial and natural hazard risk solutions, announced today that it has received official notification from the Kentucky Department of Insurance that its premium tax database has been designated as a “verified risk location system.” With this verification, First American Spatial Solutions can now offer the insurance industry a comprehensive tax database to alleviate the complexities of tax jurisdiction assignments in the state of Kentucky.
By using a “verified risk location system,” insurers can have greater confidence in the accuracy of tax information. Insurers will also be protected by the state of Kentucky’s “Hold Harmless” provision and will not be liable for additional tax or penalties if it is determined that an address is not properly assigned to its designated jurisdiction. In order to be classified as a verified risk location system, the First American Spatial Solutions’ premium tax database and decision engine had to demonstrate accuracy at a rate of 90 percent or better. The system must undergo recertification every three years.
“Correctly assigning tax jurisdictions and then collecting and remitting taxes to each taxing locality throughout the state can be an extremely complex task,” said Dan Lawson, director of Tax Application for First American Spatial Solutions. “ZIP code-based solutions are prone to errors. Our solution will help enterprises throughout Kentucky reduce costly audits, customer service problems and non-compliance issues.”
First American Spatial Solutions’ insurance premium tax output identifies the lowest level taxing authority by name and by Federal Information Processing Standards (FIPS) code. With a special tax-code field, the system also provides the state Department of Insurance community code for the city and county and the state coding which allows insurers to better understand offsets and the minimum tax indicator. First American Spatial Solutions calculates the distance of the address to the boundary of the jurisdiction.
The premium tax database has information for 20 states that have a local insurance premium tax (IPT) that provides several levels of information, including:
- Output of the lowest level taxing authority and any special coding from the states needed to identify the jurisdiction along with the standard jurisdiction name and FIPS code
- Easy business rule development based on match code and distance to jurisdictional boundary
- Output of fire district name where it is a part of the jurisdiction for the IPT
Developed at a granular level of detail, using proprietary methodology, First American Spatial Solutions’ databases deliver the most accurate information upon which insurance companies are able to base the decisions that affect the insurance enterprise as a whole. Since First American Spatial Solutions owns and maintains its databases, clients are guaranteed accurate alignment of data layers, up-to-date information and a single point of contact for support. For more information, please visit: www.faspatial.com/index.php/products/databases/tax-databases.html
About First American
The First American Corporation (NYSE: FAF) is a FORTUNE 500® company that traces its history to 1889. With revenues of approximately $6.2 billion in 2008, it is America's largest provider of business information. First American combines advanced analytics with its vast data resources to supply businesses and consumers with valuable information products to support the major economic events of people's lives, such as getting a job, renting an apartment, buying a car or house, securing a mortgage and opening or buying a business. The First American Family of Companies, many of which command leading market share positions in their respective industries, operate within five primary business segments, including: Title Insurance and Services, Specialty Insurance, Information and Outsourcing Solutions, Data and Analytic Solutions, and Risk Mitigation and Business Solutions. More information about the company and an archive of its press releases can be found at www.firstam.com.