Real Estate Council of Ontario (RECO) says the insurance program manager handling the iPro Realty Ltd. matter is working toward processing the “significant volume” of agent commission protection claims within months.
An update released by RECO on Wednesday offers a glimpse into the insurance payout situation for consumers and agents. In August, Mississauga-based iPro was forced to close after the discovery of a $10.5-million shortfall in its trust account.
The fallout has been concerning and confusing for many of those affected.
Since Aug. 29, the insurance program manager has been paying eligible consumer deposit claims submitted under the professional liability insurance program. Consumer deposit claims are being paid on a rolling basis, in line with transaction closure dates, said RECO.
The path is not as straightforward for agent commissions. The program manager is currently investigating outstanding commission protection claims, said RECO.
“This process is complex, as it must balance the number of claims against the available funds and insurance limits,” reads the notice. “While commission-related claims can sometimes take years to resolve, our goal is to finish the process within months, not years.”
RECO said the proper assessment of claims must be meticulous.
In some cases, it said, transactions appear to have been reassigned to other brokerages, which is “complicating the process of determining which claims are valid.”
RECO said it will provide another update within the next eight weeks.
The total amount of insurance coverage for consumer deposits and commissions is up to $8 million in aggregate ($4 million for each) with an additional limit of $200,000 per individual, per claim (not per transaction), RECO has publicly stated.
Real Estate Magazine asked RECO how many claims have been submitted, to which a spokesperson replied, “Unfortunately, we do not have that information available at this time.”
Interim report not publicly released
RECO also said Wednesday that the interim report from Dentons Canada LLP, which is conducting an independent review of the iPro matter, was shared with Minister of Public and Business Service Delivery and Procurement Stephen Crawford.
The final report is due on Oct. 30. RECO said under Crawford’s direction, the findings will be made public after the ministry has had the opportunity to review the final report.
Courtney Zwicker is a digital reporter and associate editor for REM. Based in Atlantic Canada, she has over a decade of experience covering daily business news.