Tarion Warranty Corporation

Ontario to introduce new home warranty regulator

Thursday, February 21, 2019

The Ontario government has announced plans to transform Tarion Warranty Corporation and implement initiatives to better inform and protect new home buyers, including purchasers of cancelled pre-construction condominium projects.

The Ontario government plans to:

  • Work with the Home Construction Regulatory Authority to establish a separate regulator for new home builders and vendors to address any concerns about the conflict of interest with Tarion performing both functions;
  • Introduce legislative amendments that, if passed, will require Tarion to publicly disclose compensations for its board and executives and move to a more balanced skills-based board composition;
  • Explore the possibility of introducing a multi-provider insurance model for new home warranties and protections in the province, with a decision coming later this year; and
  • Introduce new initiatives through work with the Condominium Authority of Ontario that will better inform and protect purchasers of cancelled condominium projects.

The changes follow the release of a 2016 independent report from the Honourable Justice Douglas Cunningham featuring several recommendations on transforming Tarion. The report noted an inherent conflict of interest in the current structure of Tarion that leaves new home owners vulnerable.

“Establishing a separate regulator for new home builders and vendors addresses the current conflict of interest with Tarion,” said Bill Walker, Minister of Government and Consumer Services, in a news release. “[This] announcement will help make Tarion more accountable and transparent and provide quality service for the people of Ontario.”

Tarion has been responsible for administering the Ontario New Home Warranties Plan Act since 1976. New homes built for resale or under contract with an owner must be enrolled in Tarion’s statutory home warranty program and builders must be registered. Tarion is expected to continue to provide services to new home owners, builders and vendors during the transformation, while operating under greater government oversight.

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