OREA Real Estate College

Insurance = Good Business Sense, Plus…

0 Comments 28 March 2012

 

…it’s mandatory. Yet, salespersons, brokers, and brokerages continue to have their registration revoked by the Real Estate Council of Ontario (RECO) for non-payment of insurance. For example, in 2010-2011, RECO issued 26 proposals to revoke registration due to non-payment of insurance.

Participation in RECO’s insurance program is mandatory, and coverage must be renewed annually.

Insurance requirements are set out in Section 11 of Ontario Regulation 579/05: Education Requirements, Insurance, Records and Other Matters. RECO’s insurance program includes commission protect insurance, consumer deposit insurance and errors and omissions, which are defined in the regulation.

Commission Protection Insurance

Insurance to pay claims made by a registrant for commission or remuneration in relation to a trade in real estate if the claims arise out of money or other property entrusted to or received by another registrant in the course of trading in real estate and,

(a) the money or other property has been stolen, misappropriated, otherwise wrongfully converted or obtained by fraud, or

(b) the other registrant is a brokerage and has become insolvent.

Deposit Insurance

Insurance to pay claims for the loss of a deposit or part of a deposit in relation to a trade in real estate if the claims arise out of money or other property entrusted to or received by a registrant as a deposit in the course of trading in real estate and,

(a) the money or other property has been stolen, misappropriated, otherwise wrongfully converted or obtained by fraud, or

(b) the registrant is a brokerage and has become insolvent.

Errors and Omissions Insurance

Insurance to pay for damages and legal costs arising out of claims for damages made against a registrant for an error, omission, or negligent act in the course of trading in real estate.

Stay Tuned

Stay tuned for future blog posts where we will review some of the more common breaches in more detail.

For More Information

For more information about RECO’s insurance program, go to http://www.reco.on.ca/section-professional/tc-231/sc-350.html.

 

 

 

Be Sociable, Share!

Share your view

Post a comment

Join the Conversation

Author

This post was written by who has written 147 posts on Ontario Real Estate Association Blog.

A manager of curriculum services for OREA Real Estate College, Sue writes and edits various documents for the College. She is a graduate of McGill University, and holds a post-graduate diploma in journalism from Humber College and a public relations certificate from Ryerson University.