Jul 14 | 2017

Why Jack Smith* was glad he had E&O Extra® with Protection+

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E&O InsuranceWhen Jack’s clients were slapped with a $47,000 development charge, they were astounded. Jack made an honest mistake in failing to advise them about this charge and that there was no cap on it.

To maintain their reputation and keep their clients happy, the law firm was able to negotiate with the builder to reduce it to $10,000. Looking at a reasonable industry standard, the purchaser of a new home could expect to pay $7,500 in development charges so the firm covered $2,500 from their own pocket and the clients paid the remaining amount.

Luckily for Jack, he was protected by his E&O Extra** with Protection+ insurance. He submitted a claim to FCT and was reimbursed for the $2,500 paid to smooth things over with the client.

If you were in a similar situation, would you have been protected?

FCT understands that mistakes happen. We offer insurance products to complement your mandatory E&O insurance. We provide reimbursement for losses resulting from claims against your mandatory E&O insurance for residential and commercial real estate transactions. This includes your standard deductible payment and any increase in premium***.

For additional coverage, like Jack’s, you can add Protection+ to your E&O Extra policy for a minimal fee.  It offers you the ability to settle smaller claims directly with your client and avoid going through your mandatory E&O coverage. It covers up to $10,000 per policy year or a maximum of three claims (whichever comes first).

Contact us to learn the different ways we can protect you and your reputation.

 

*The name has been changed to protect the privacy of our clients.
** E&O Extra does not cover dishonest, fraudulent or criminal acts of omissions.
*** Standard deductibles, premiums and coverage amounts vary by region.
Insurance by FCT Insurance Company Ltd. This material is intended to provide general information only. For specific coverage and exclusions, refer to the applicable policy.
Jul 7 | 2017

3 Tips to Stay Healthy When it Gets Busy

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Tips to stay healthyWhether you’re a lawyer, lender, mortgage broker or realtor – working in the real estate industry can be unpredictable. Before you know it, things get hectic and you can slip into bad habits like skipping meals, not exercising and working on just a few hours of sleep. This will eventually take a toll on your health and even your mood. But when you’re busy, it’s even more important to maintain peak performance.

Here are three simple ways you can stay healthy and energetic all year round.

1. Make healthy food choices

Not that you can’t enjoy the occasional pizza party, but think of it this way, nutrition fuels your body and you’ll get the most out of premium gas. If you skip meals, you may end up making bad food choices out of hunger. Try to stash healthy snacks like fruits, nuts and pre-cut veggies at your desk. This way you won’t need to rely on candy bars and fast food to get you through the day.

2. Keep active

You may be sitting hunched over a desk all day or behind the wheel of a car – going to client meetings or rushing from one property to another. Take some time in the day for a quick stretch break or better yet, start a fitness challenge with co-workers. Getting other people on board is a great way to ensure you all stay moving and motivated.

3. Set expectations and priorities

At the end of the day, you’re only human. Make sure your clients and co-workers have reasonable expectations of you. Create a list of priorities for the day to help you get organized and let people know when they can expect deliverables.

Do you have any other tips to get through busy periods? Share it with us in the comments section!

Mar 21 | 2016

Need a reason to choose FCT for commercial title insurance? Forget about one — we’ll give you 10!

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The top 10 reasons to partner with FCTAs Vice-President, Commercial Solutions, I am responsible for leading and growing the Commercial Solutions Division here at FCT. To accomplish this, my team listens to what our commercial customers are saying they need in order to succeed. We then provide them with the products and services to help them reach their goals and protect their investments.

It’s been said before, but it bears repeating: commercial title insurance offers essential protection and helps make a commercial transaction far more efficient. Plus, it has been providing Canadian lenders, lawyers and their clients with critical peace of mind since 1991, when FCT introduced the concept to the Canadian marketplace.

Today the title insurance market is a little more crowded than it was back then. Commercial customers have a choice to make and although we think that the choice is crystal clear, people still sometimes ask:

“Why would I choose to partner with FCT for commercial title insurance needs?”

I love this question, because not only do we have a good reason for you to choose FCT, we can actually give you 10 . . . and in video form, no less!

So if you’re looking for:

  • Products that meet your needs;
  • Service that makes you feel valued; and
  • Solutions that will help build your business and protect your investments

there is no need to look any further than FCT. We’ve been here since the very beginning and we will continue to innovate, well into the future.

Are you a customer of FCT? If so, tell us why you chose to partner with FCT by commenting below.

Jul 9 | 2014

Creative ways to help your vendor close the deal

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creative

In my previous blog posts I have focused on the value title insurance brings to commercial real estate lawyers/notaries that are acting on behalf of purchasers. Now I would like to discuss how title insurance can be leveraged when acting on behalf of the vendor to help close deals. Below are two situations where a commercial lawyer/notary can leverage title insurance to ensure a deal closes as planned:

Reduce the odds of a purchaser walking away from a deal

• The situation: Every once in a while when acting on a sale, you may come across that purchaser who is looking for any excuse to walk away. This can potentially mean the end of a deal for your vendor. As a lawyer acting on behalf of the vendor, you want to limit these reasons and increase the chances of closing.
• The solution: The Agreement of Purchase and Sale provides that the purchaser will accept a title insurance policy which insures over various title objections that are unknown to the vendor and could be raised by the purchaser. As a result, the purchaser can’t walk away from the deal if title insurance can cover the issue. This could include any issues that arise during the due diligence process, including encroachments, old mortgages not yet discharged, discrepancies in the legal description, non-compliance with zoning by-laws and so on.

The vendor knows of an existing problem with the property

• The situation: The vendor is aware of a problem with the property that is being sold (e.g. the building encroaches into the municipal setbacks) and is concerned that a prospective purchaser might walk away from the deal or insist on abating the purchase price because of it. Often times these issues are relatively minor and have existed on the property for many years.
• The solution: Speak to an underwriter at FCT first to confirm that coverage is available. If so, then the vendor must disclose the issue to the potential purchaser and add it as a condition that the purchaser will accept title insurance to cover the defect. This means that there is less likelihood that the purchase price will be called into question or the deal will fall through.

To effectively implement these solutions, we have provided samples clauses that can be easily inserted into your agreements. Click here to view these clauses.

With a better understanding of our policies, lawyers/notaries are making the most of the myriad benefits they offer. By finding new ways to introduce title insurance at the beginning of transactions, you can add value to all parties, including vendors. By maximizing the coverage it affords, vendor clauses will provide a smoother and more efficient closing process for both you and your clients, while saving money and stress.

Are there any other ways you use title insurance to help close your deals? Tell us!

Nov 14 | 2013

Will you face the risk of mortgage fraud without title insurance?

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mortgage fraudRecently I read an answer column in @TheProvince suggesting to a BC homeowner that they work with a bank and a lawyer to remove a fraudulent mortgage from their property. http://ow.ly/qorbe My heart sank when I noticed the absence of any information about title insurance by the homeowner or the columnist.
Hot housing markets with high home prices attract fraudsters. BC has some of the highest home prices in the country and counter-intuitively one of the lowest adoption rates of title insurance. I have created a chart below to demonstrate what happens if there is a mortgage fraud on your house with and without title insurance.  On one side of the table are the steps a homeowner with title insurance needs to do when he/she finds out that there is a fraudulent mortgage on title and on the other side are the steps for a homeowner without title insurance. The process from a title insurer’s perspective generally takes 3-8 months depending on the complexity of the claim.

Actions With Title Insurance Without Title Insurance
At time of home purchase Homeowner pays one-time premium for a homeowner title insurance policy. Premium is based on home purchase price. For properties valued between $200- $500,000, the premium averages $250-$350. Homeowner may also purchase Title Fraud protection policy after purchase (Cost is slightly higher than at time of purchase transaction) Homeowner declines or is not advised of homeowner’s title insurance at time of purchase.
Secure legal representation Contact title insurer and submit claim:- Provide documentation, statements etc to title insurer to establish coverage under claim. Title insurer secures representation on claim file with a knowledgeable legal advisor. Homeowner must locate a lawyer who practices in the area of title fraud.- Homeowner(s) must attend an initial meeting with & determine if they want to retain that lawyer to take on their case. May require more than 1 meeting
Cost for legal representation There is no deductible on a title insurance policy. Homeowner must discuss terms of payment with the retained lawyer and pay an upfront  retainer if requiredEstimated $3,000-5,000.
Hearing Process Once title insurer agrees to cover your claim, insurer completes the process of having the fraudulent mortgage deleted from title. Insured may be required to attend meetings or hearings to complete the process Homeowner must liaise and instruct the lawyer as the case continues.
If hearing is successful, fraudulent mortgage is removed from title<
May be able to recover some costs from a Provincial Land Title Assurance Fund
Total Cost to Restore Title Policy Premium amount averages: $250-$350.00 $10,000-15,000.00 estimated

The real benefits to the homeowner with title insurance are as follows:

  1. You have the peace of mind that you have insurance coverage for the issue;
  2. You do not have to worry about paying any of the out-of-pocket legal costs associated with having the mortgage deleted from your title;
  3. You have the peace of mind that you are dealing with a company that is very familiar with the    issue of title fraud and will choose knowledgeable professionals to deal with the matter; and
  4. The cost to you at the end of the day will be significantly less.

Again it should be your choice as a homeowner on how much risk you are willing to take on the issue. So be an informed consumer and, please ask us questions!

Nov 5 | 2013

Financial literacy month – Test your title insurance knowledge

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In Michael’s last blog he spoke about the need to create informed consumers knowledgeable about title insurance. So in the spirit of being an “informed consumers” its time to test your knowledge of title insurance basics. Check your answers below.

1. A title insurance policy deals only with:

            a) the value of the property.

            b) matters which affect the title of the property.

            c) matters that deal with renovations to a property.

2. Title insurance policies require:

 a)  an annual premium.

            b) a monthly premium.

            c) one payment at closing time.

 3. When does the purchaser pay the premiums of title insurance?

           a)  when the lawyer asks for it.

           b) once a year on the closing date.

            c) once, upon closing.

            d) no later than 1 month after closing.

4. True or False? – There is no deductible on a title insurance policy claim.

5. Can title insurance policies be transferred?

            a)      no, never.

            b)      yes, if the insurance allows it to happen.

            c)      yes, when a homeowner writes to the insurance company indicating his or her wishes.

            d)      yes, in the event of a homeowner’s death and according to the provisions in his or her will.

6. Which one of these potential problems does title insurance protect against?

            a)      any fraud or forgery in the chain of title.

            b)      loud neighbours.

            c)     items that were listed in the offer but then taken away.

            d)     bad wiring.

 7. What will trigger a title insurance claim?

           a)     The deck on your new home has become unstable and wobbly and in need of repair.

           b)     You receive a work order from the municipality to remove the deck that you built without a permit.

           c)    You receive a municipal work order to remove the deck that the previous owners built without a permit.

 

Answers: 1) b,  2) c,  3) c,  4) True,  5) d,  6) a,  7) c)

Score:

1-3 correct – Please ask questions on this Blog

4-6 correct – Thanks for reading the FCT Blog!

All correct- Hey do you work here?

Nov 1 | 2013

Financial Literacy Month – The need for informed consumers

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—November is financial literacy month and since the financial crisis there has been a great effort on the part of governments, financial institutions and financial services professionals to increase the financial knowledge of Canadians.  Financial literacy is also one of the main reasons I am committed to The FCT Blog – to increase understanding of title insurance and answer product questions.

 I believe that an informed consumer is the fundamental pillar of financial literacy and subsequently consumer protection.  But how does the average homebuyer hear about the benefits of title insurance? Normally through their lawyer or notary.  But across Canada there are varying requirements on lawyers to provide information about title insurance. In Ontario, lawyers are required by the Law Society to discuss all options to protect their title – a survey with a legal opinion or title insurance. When given this option guess what? According to the Law Society over 90% of consumers choose title insurance in Ontario on their lawyer’s recommendation. I actually think that it is closer to 100% but we can discuss that another time.

 In other provinces many lawyers take it upon themselves to ensure that their clients are informed about title insurance. Consumers need information about the products that will protect and benefit them in order to make an informed choice. As discussed in previous blogs title insurance can protect consumers from many issues where there is no or limited coverage provided elsewhere. I and FCT strongly support the policy that all Canadian homebuyers be made aware of products like title insurance that can benefit them in the purchase of a home.

 So in the mean time, ask your lawyer or notary about title insurance as an option. Or ask me -as always we are happy to help answer any questions in this regard.

Oct 17 | 2013

The title insurance landscape

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The title insurance landscape

When you walk down the street, drive downtown, take a train through the countryside or fly over Canada the landscape features many different types of property. You will see homes, condos, apartment buildings, strip malls, schools, hospitals, office towers, hotels, industrial buildings, infrastructure like power plants, agricultural and wind farms, recreational properties – to name a few.  Each type of property has different characteristics and benefits that come with ownership or “title” to the property.

Title insurance at its core, has one common role – to protect your rights of ownership in a property.  When you buy or take an interest in a property, you want to make sure it is yours and that no one else has, or will have, a claim against your ownership.  As well, you want to know that your use and enjoyment of the property will continue, whether it is for a store, an office or simply your home.  Just as real estate property across Canada varies, so does the title insurance policy to ensure your ownership rights are fully protected.

In future posts, we will cross Canada and visit various properties, in some cases specific properties that we have title insured, to discuss the unique features of title insurance by property type.  For our first stop let’s visit the one that affects most of us – Title Insurance for homeowners.

FCT’s Vice President of Residential Title Insurance Services, Lori Sartor, explains:

When you buy something, usually you pay for it and you take it with you.  You have possession of it, so it is yours to eat, drink, use or throw away.  But real estate is a little different.  When you buy a home, it stays put.  You pay your money and receive a deed to say the home is yours.  In doing this, you assume the vendors actually owned it and had the right to sell it to you.  But what if they didn’t?  What if you are a victim of fraud?  What if someone else were to claim that they own your property?  Your largest single investment in life (and your home) could be at risk.  That’s why all Canadians need title insurance.

A residential home owner policy insures you against loss if you don’t have the ownership you paid for.  Your title insurance company will defend your rights against any valid claim insured under the policy, and compensate you for your loss.  And this coverage remains in place for as long as you or your heirs own the property.  There are no renewals to worry about and no further premium payments.

Generally, title insurance is arranged by your lawyer at the time you purchase your home.  He or she will order a policy from the title insurer and the one-time premium (usually in the range of $200-$350) will be included in the disbursements portion of the lawyer’s invoice.  However, if title insurance was not purchased when you bought your home, it is also possible to buy it afterward.  Simply contact your lawyer or, if you prefer, you can contact a title insurer directly.

In addition to the basic coverage outlined above, there are other areas of protection in a residential owner policy.  They may include the following; however, you should refer to the actual policy for specific coverage and exclusions:

  • Protection against municipal enforcement of outstanding building permit requirements for work done prior to your purchase without a required permit
  • Protection against outstanding work orders prior to your purchase
  • Protection against tax payments owed by the previous owner
  • Protection against encroachments on your property and the forced removal of encroaching structures onto your neighbour’s property
  • Protection against  zoning infractions to ensure you can continue to use your property as a residence
  • Protection against fraudulent mortgages registered illegally against your property or if your property is fraudulently transferred out of your name through forgery or impersonation

Should you wish to learn more about title insurance, you may refer to a publication entitled UNDERSTANDING TITLE INSURANCE, provided by the Financial Services Commission of Ontario (FSCO).  To view this document, please click the link provided below.

http://www.fsco.gov.on.ca/en/insurance/brochures/Documents/undstitins.pdf

So there it is – a summary view of residential title insurance for home owners.  Perhaps you have further questions or thoughts about title insurance.  Well, this is your opportunity to get them answered or shared.  We would love to hear from you.

Oct 4 | 2013

Title insurance — can someone please explain?

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Title insurance It’s been about 20 years and almost 11 million title policies since FCT (then First Canadian Title) opened its doors and created a title insurance industry in Canada. Lawyers use title insurance regularly and, in some parts of the country, almost without exception. Banks and mortgage lenders rely on it. Hundreds of thousands of homeowners have it. One might conclude that it is well understood. But, raise the subject at a backyard barbecue or cocktail party and you’re likely to get blank stares and a bit of mumbling.

What’s more, it’s not easy for the average person to become informed. Lawyers get it. But who has regular, easy access to a lawyer? Insurance brokers can’t help — they don’t sell it. Even the Internet provides no current interactive Canadian source for such information. So, where does one turn for answers? Right here!

FCT is pleased to introduce “The FCT Blog,” a new forum to foster interactive discussion around all things title insurance – and the one place where all your title insurance questions will find informed answers from the industry experts. In the beginning, we will focus on what it is, what it covers, how it is acquired and how claims work. We are open to your questions and plan to address those topics most interesting to you in future posts.

Looking more broadly, FCT recognizes that title insurance is one of many products and services supporting a vibrant housing industry. Through our interaction with buyers, sellers, realtors, lawyers, lenders and appraisers, FCT has built significant expertise and developed unique insights related to our mutual marketplace. As our blog evolves, we plan to share our insights, observations and opinion to build understanding of our evolving marketplace, the changes and impacts we see and the emerging opportunities for innovation and growth. What an opportunity for important dialogue!

So, welcome. We look forward to hearing what you think and how we can serve you better with this exciting, new endeavour.