Tarion, Ontario’s consumer protection organization for new home buyers, anticipates compensating buyers with over $90 million this year due to an unprecedented number of developers entering receivership and failing to complete residential projects. This surge in claims, described as the “largest claim event” in Tarion’s history, has been attributed to increased interest rates and construction costs causing builder insolvencies and project abandonments. Tarion’s coverage protects up to $60,000 for homes under $600,000 and up to $100,000 for homes over this price, with total anticipated claims potentially exceeding $90 million. Despite these challenges, Tarion aims to mitigate similar future risks by enhancing homeowner education, refining its underwriting processes, and working with the Home Construction Regulatory Authority (HRCA) to impose sanctions on failing builders. Tarion assures that these significant payouts will not affect its capacity to handle future claims, thanks to effective capital management and reinsurance strategies.

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