Illegal home builders put buyers at risk!

Press Release:

Tarion Warranty Corporation is recognizing Fraud Prevention Month with a strong warning to consumers that an illegally built home in Ontario may come with devastating consequences, including a home that may be unsafe to inhabit or a builder who, once paid, abandons the project altogether.

“When it comes to the largest investment of a family’s life, namely a newly built home, it pays to know that your builder has the technical and financial wherewithal to complete the job and that you have the protection of a warranty if anything goes wrong,” said Howard Bogach, Tarion’s president and CEO. “If builders are not registered with Tarion, they are building illegally and won’t provide warranty protection that is legally required in Ontario.”

Bogach emphasized that every builder in Ontario must be registered with Tarion and must enroll all newly built homes in the warranty program. It’s the law. And almost all municipalities across Ontario are supporting it by sharing their building permit information with Tarion. An additional 15 municipalities have partnered up with Tarion to educate consumers who opt to take out permits in their own names as opposed to using a builder licensed by Tarion.

Illegal builds are more than just a bad idea. They can be expensive for homeowners and builders alike. Last year, for example, Ontario provincial courts set down 117 convictions related to illegal building, and illegal builders paid almost $400,000 in fines for proceeding without proper registration, warranties, or permits. In 2016, one builder even went to jail.

Bogach expects this price tag to increase in 2018 because the fines themselves have increased. Beginning in 2018, builders found in violation of the law will face fines up to $50,000 – up from $25,000 – as well as imprisonment for one year, less a day (twice the previous jail time). Corporations building new homes will face the heaviest penalties with maximum fines of $250,000, up from the previous $100,000. Even directors and officers of these delinquent companies are subject to penalties up to $50,000.

For the homeowner, risks are also high. Unregistered builders do not necessarily comply with Ontario Building Code specifications and the new owner can fall victim to poor craftsmanship, including such dangerous and costly elements as electricity and plumbing. There is also the risk that an illegal builder will take a buyer’s deposit and then abandon the build.

In keeping with its mandate of consumer protection, Tarion advises prospective buyers of new homes to recognize the following signs that a builder may be operating illegally. Builders:

  • Say they built the house for themselves but then decided to sell it.
  • Say they offer their own warranty and the homeowner doesn’t need Tarion’s warranty.
  • Say the Tarion warranty is too costly (sometimes quoting $10k when in fact the maximum cost is $1800 plus taxes.)
  • Offer the consumer a brief contract or, worse, no contract at all.

About Tarion Warranty Corporation

For more than 40 years, Tarion has been enhancing confidence in the new home buying experience. Tarion is a private, not-for-profit corporation that administers the Ontario New Home Warranties Plan Act, and backstops the warranty coverage. We set the standards for builder licensing and after-sales service and step in when your builder cannot or will not fulfill the warranty obligations. Since 1976, Ontario’s new home warranty program has registered close to two million homes and paid put hundreds of thousands of dollars in warranty claims. Our mandate is to serve the public interest, and is what guides us every day.

SOURCE Tarion Warranty Corporation

www.tarion.com

 

When your parents die broke

By Liz Weston

THE ASSOCIATED PRESS

Blogger John Schmoll’s father left a financial mess when he died: a house that was worth far less than the mortgage, credit card bills in excess of $20,000 and debt collector s who insisted the son was legally obligated to pay what his father owed.

Fortunately, Schmoll knew better.

“I’ve been working in financial services for two decades,” says Schmoll, an Omaha, Nebraska, resident who was a stockbroker before starting his site, Frugal Rules. “I knew that I wasn’t responsible.”

Baby boomers are expected to transfer trillions to their heirs in coming years. But many people will inherit little more than a pile of bills.

Nearly half of seniors die owning less than $10,000 in financial assets, according to a 2012 study for the National Bureau of Economic Research. Meanwhile, debt among older Americans is soaring. It used to be relatively unusual to have a mortgage or credit card debt in retirement. Now, 23 per cent of those older than 75 have mortgages, a four-fold increase since 1989, and 26 per cent have credit card debt, a 159 per cent increase, according to the Federal Reserve’s latest data from the 2016 Survey of Consumer Finances .

If your parents are among those likely to die in debt, here’s what you need to know.

*YOU (PROBABLY) AREN’T RESPONSIBLE FOR THEIR DEBTS When people die, their debts don’t disappear. Those debts are now owed by their estates. Some estates don’t have enough assets (property, investments and cash) to pay all of the bills, so some of those bills just don’t get paid. Spouses may have the responsibility for certain debts, depending on state law, but survivors who aren’t spouses usually don’t have to pay what’s owed unless they co-signed for the debt or applied for credit together with the person who died.

What’s more, assets that pass directly to heirs often don’t have to be used to pay the estate’s debts. These assets can include “pay on death” bank accounts, life insurance policies, retirement plans and other accounts that name beneficiaries, as long as the beneficiary isn’t the estate.

“You take it and go home,” says Jennifer Sawday, an estate planning attorney in Long Beach, California.

*YOU NEED A LAWYER Some parents hope to avoid creditors or the costs of probate, which is the court process that typically follows a death, by adding a child’s name to a house deed or transferring the property entirely. Either of those moves can cause legal and tax consequences and should be discussed with a lawyer first. After a parent dies, the executor must follow state law in determining how limited funds are distributed and can be held personally responsible for mistakes. That makes consulting a lawyer a smart idea _ and the estate typically would pay the costs. (The costs of administering an estate are considered high-priority debts that are paid before other bills, such as credit cards.)

At his attorney’s advice, Schmoll sent letters to his dad’s creditors explaining the estate was insolvent, then formally closed the estate according to the probate laws of Montana, where his dad had lived.

A lawyer also can advise you how to proceed if a parent isn’t just insolvent, but also doesn’t have any assets at all. In that situation, there may not be a reason to open up a probate case and deal with collectors, Sawday says.

“Sometimes, I advise clients just to lay the person to rest and do nothing,” Sawday says. “Let a creditor handle it.”

*YOU NEED TO TAKE METICULOUS NOTES The financial lives of people in debt are often chaotic _ and sorting it all out can take time. As executor of his dad’s estate, Schmoll dealt with over a dozen collection agencies, utilities and lenders, often talking to multiple people about a single account. He kept a document where he tracked details such as the names of people he talked to, dates and times of the conversations, what was said and required follow-up actions as well as reference numbers for various accounts.

*YOU SHOULDN’T BELIEVE WHAT DEBT COLLECTORS TELL YOU Some collectors told Schmoll he had a moral obligation to pay his father’s debts, since the borrowed money might have been spent on the family. Schmoll knew they were trying to exploit his desire to do the right thing, and advises others in similar situations not to let debt collectors play on their emotions.

“Just don’t make a snap decision, because it’s very easy to say, ‘You know what? I need to think about it. Let me call you back,”’ Schmoll says.

_______

This column was provided to The Associated Press by the personal finance website NerdWallet.

1 in 5 top British insurance employees are women – survey

1 in 5 top British insurance employees are women – survey

The progression of women in the British workforce is in focus following the requirement for companies to publish gender pay gap data by April 2018.

Data from insurer Standard Life <SLA.L> last week showed men in the company were paid on average over 40 percent more than women at April 2017, while Aviva’s <AV.L> pay gap was nearly 30 percent, according to data published last month.

Insurers have put the pay gap down to a lack of women at senior levels.

“There is a great determination at the very top of our member firms to tackle this issue,” ABI director general Huw Evans said in a statement. Four in five insurers have diversity strategies and provide training in unconscious bias, the ABI said.

The ABI’s findings came from data covering more than 82,000 insurance employees.

Zurich Insurance buys QBE’s Latam business for $409 million

ZURICH (Reuters) – Zurich Insurance (ZURN.S) said it was buying QBE Insurance Group’s (QBE.AX) Latin American business for $409 million, becoming the leading insurer in Argentina and No.3 in Ecuador.

The acquired business had gross premiums of $790 million last year, with Argentina representing about half and the rest divided among Ecuador, Mexico, Brazil and Colombia, Zurich said in a statement on Sunday.

“This transaction positions us as the leading insurer in Argentina, a market that is demonstrating strong growth, a stable economy and a positive environment for insurance,” Claudia Dill, Zurich’s Chief Executive Officer for Latin America, said in the statement.

Zurich said it expected to achieve an overall return on investment comfortably in excess of 10 percent within the first full year post completion of the transaction. Completion is expected by the end of 2018 and funding is to come from internal resources, Zurich said.

In a separate statement, QBE said it expected a pre-tax profit from the sale of about $100 million.

Australia’s biggest insurer will retain its Puerto Rico operations to service claims from Hurricane Maria, it said.

ZURN.SVIRT-X LEVEL 1
-0.70(-0.22%)
ZURN.S
  • ZURN.S
  • QBE.AX
  • ANZ.AX

”The decision to exit Latin America is consistent with our focus on simplifying the group, reducing risk and improving the consistency of our results,” QBE Chief Executive Pat Regan said.

Europe’s fifth-biggest insurer last year bought Australia and New Zealand Banking Group’s (ANZ.AX) life insurance arm for $2.1 billion, a deal that propelled it to the top rank in the attractive Australian market.

 

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Online insurance sales: a looming disaster

LONGUEUIL, QCFeb. 21, 2018 /CNW Telbec/ – In conjunction with the detailed review of Bill 141, the Regroupement des cabinets de courtage d’assurance du Québec (RCCAQ) would like to emphasize the importance of protecting consumers’ financial well-being by requiring a certified representative to be involved in insurance purchases. The RCCAQ is seeking to avoid disastrous consequences for consumers, particularly when submitting claims to insurers.

Modernization and consumer protection should go hand in hand

The RCCAQ supports efforts to modernize the legislative framework governing the distribution of property and casualty (P&C) insurance products. It decries the fact, however, that this process stands to jeopardize consumers’ interests. “The government should ensure that consumers have access to a distribution model offering the highest possible levels of protection. For many people, a home, a car and a cottage are among their most valuable financial assets,” said RCCAQ chair Christopher Johnson.

Consumers would be left to their own devices

If adopted in its current form, Bill 141 would allow consumers to purchase home or auto insurance online without the involvement of a representative such as a broker. Subject to ongoing training requirements and governed by a strict code of ethics, certified professionals serve as a safety net during insurance transactions, ensuring that responsibility for purchases does not fall solely on consumers’ shoulders. Nevertheless, this fundamental principle is on the verge of being undermined.

“In 2016, a Leger survey1 showed that 76% of Quebecers regarded P&C insurance as complex,” noted Mr. Johnson. “Although they may make for dry reading, riders, exclusions and other insurance policy provisions constitute essential information that brokers are able to explain to their clients. Our role is to work on consumers’ behalf and defend their interests when claims are submitted to an insurer.”

Consumer bankruptcies, as well as painful and expensive court cases with insurers, are likely to occur. The ideal solution, however, is within reach: simply require a certified professional to be involved in the online sales process.

About the RCCAQ
The RCCAQ is a professional association that seeks to promote and defend the socio-economic interests of its member firms, including over 4,200 brokers at some 500 firms and branch offices across the province of Quebec.

___________________________________________
1
 Leger survey conducted on behalf of CHAD in January 2016 (500 Quebecers aged 18 or older were interviewed).

www.rccaq.com

SOURCE Regroupement des cabinets de courtage d’assurance du Québec

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