• Improving Claims Resolution Icon

The New Home Warranty Program exists to ensure that homeowners are protected if there are defects in their new homes. When issues do arise, Tarion is here to work with homeowners and builders to make sure claims are resolved. In 2018, we continued to improve our dispute resolution processes, tools and communications to make them more effective and easier to understand and navigate.

Enriching Communication throughout the Claims Process

In 2015, in response to homeowner feedback, Tarion initiated an external review of our dispute resolution processes. The subsequent report triggered a series of improvements as well as new initiatives that have continued to evolve Tarion’s dispute resolution approach. In 2018, we made a number of additional changes based upon recommendations from the external review.

  1. For dispute resolution to be successful, both parties need to first understand the claims process. To provide greater clarity for both homeowners and builders, Tarion revamped its correspondence to include additional information regarding what to expect at each stage of the claims process.
  2. Equal access to information helps promote fairness in the conciliation process. Previously, homeowners and builders were not always aware that Tarion has the authority to require the sharing of drawings, specifications, or other information pertinent to the warranty claim between the parties. With revisions to our communications materials, we now highlight that either party can request additional explanatory documentation via Tarion.
  3. Decision letters document Tarion’s judgment regarding whether particular defects in dispute are warranted or not. In 2018, Warranty Services representatives and managers completed training to help improve their decision letter writing skills, and we will continue this training in the coming year. We also added an additional step wherein each decision letter is reviewed by an advisor who is not associated with the file and who can independently assess and critique its readability.
  4. From conciliation to early intervention to mediation, Tarion has a variety of dispute resolution mechanisms that can be employed to resolve warranty claims. To promote awareness and understanding of the claims process and the various dispute resolution options and how they work, we produced a number of new resources, including the Warranty Process Manual, the 7 Steps to Resolve Your Warranty Claim, the 10 Steps You Need to Know about Your Conciliation video, a podcast on dispute resolution, and several blog posts and articles on conciliation, early intervention and how to make a warranty claim.

Through the continued evolution of our tools, communications and processes, Tarion is helping to ensure both homeowners and builders understand their warranty rights and responsibilities, are aware of the resources available to them and are able to make informed decisions throughout the claims process.

Promoting Mediation as a Path to Resolving Disputes

The warranty claims process can grind to a halt in situations when a homeowner and a builder reach an impasse over disputed issues. Mediation can help the parties find a way forward, eventually leading to a resolution before the matter escalates.

Mediation requires both the homeowner and the builder to agree to participate and, ideally, to sign off on a final negotiated agreement. During the process, both sides have an opportunity to tell their side of the story and what they would like to see done about the issue. The mediator considers both points of view, reviews all the information and documents provided by both parties, helps in the discussion of possible solutions and facilitates in negotiating an agreement.

As part of our mediation pilot, first launched in 2017, a number of staff were trained to act as mediators. In 2018, nine successful mediations took place and, based on the positive feedback from the participants, Tarion will continue to develop and potentially expand this option.

Using Technology to Help Resolve Claims

Over the past decade, Tarion has introduced a variety of technology solutions to assist homeowners and builders in managing and fulfilling their warranty obligations using their desktop computers or smart devices.

Virtual Inspection Pilot: When a homeowner first identifies an issue in their home, they may need advice as to whether it will be warranted. Instead of requesting an onsite inspection, the homeowner can download an app on their phone, call Tarion and use the app to provide a live video feed that appears in a dashboard on a Tarion representative’s desktop. Being able to see exactly what the homeowner is seeing, the Tarion representative can ask questions, provide feedback and even take measurements using this virtual inspection technology. This virtual inspection process was tested as a pilot in 2018 and has shown promise as an area where technology may help us better resolve claims and improve consumer service.

TarionConnect Project: For the next step in the warranty process, the MyHome portal allows homeowners to submit forms and track deadlines while BuilderLink gives builders the ability to view the completed warranty forms and track repair timelines.

Previously, there had been no capability for homeowners and builders to communicate with each other via these tools. But in the past year, we developed and launched a pilot of a new digital warranty management system called TarionConnect, which will help facilitate the claims process by making it possible for homeowners and builders to have an online, interactive exchange about warranty items. A homeowner’s submitted items will appear in TarionConnect and they can add additional notes or photos. The builder, in turn, can log in and update the items as ‘in progress’, ‘completed’ or ‘in dispute’. When there are items that are in dispute, Tarion will receive an alert so we can review the file and intervene to help resolve the issue before it escalates. TarionConnect has shown potential to be a game-changing tool in the warranty management process.

Claim Payments by Type of Coverage

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Appealing a Warranty Decision

In approximately 99 per cent of cases, warranty claims are resolved by builders or through Tarion’s dispute resolution processes. However, if a homeowner is not satisfied with a decision, they can appeal to the Licence Appeal Tribunal (LAT) – an adjudicative tribunal of the Province of Ontario.

Tarion is one of the only warranty providers in Canada that gives homebuyers the ability to access a fully independent tribunal to review its warranty findings, separate and apart from taking the dispute to civil court.

To pursue a LAT hearing, a homeowner must request a decision letter to appeal the matter before the LAT. In 2018, Tarion issued 138 decision letters, which was a 16 per cent drop from 2017.

The LAT provides a pre-hearing process (known as a case conference) that includes case mediation by an independent adjudicator. If there's no resolution in one or more pre-hearings, the matter proceeds to a hearing by a different adjudicator.

In 2018, just over 16 per cent of homes under warranty had a warranty form submitted while less than 1 per cent of homeowners under warranty submitted an appeal to the LAT. Our goal is to continue to improve our dispute resolution processes to reduce the number of claims that proceed to this formal adjudication process.

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Ensuring Fair Treatment

Tarion aims to resolve all claims fairly, but there can be occasions when homeowners feel they have not been treated fairly. The Tarion Ombudsperson Office exists to promote and protect fairness by investigating and seeking resolutions to complaints. Tarion was the first designated administrative authority to introduce this service for consumers, and 2018 marked the 10th anniversary of the Ombudsperson Office. The Office is an impartial, independent and confidential resource that functions independently from the rest of Tarion and reports directly to the Board of Directors.

When homeowners submit complaints, the Ombudsperson Office objectively determines whether Tarion’s process and decision were fair. Their role is meant to supplement – not replace – existing dispute resolution processes and formal channels of appeal. As such, it does not make warranty decisions or policies, nor does it formally adjudicate issues for Tarion.

In 2018, the Ombudsperson Office received 471 complaints. A summary of their activities, case studies, observations and recommendations for process improvement and/or policy changes can be found in the Ombudsperson Annual Report.