By Lori Sartor and Eric Haslett

We’re living in an unparalleled time and one that no one could have predicted. As the threat of COVID-19 continues across Canada and more efforts are put in place to “flatten the curve,” organizations across all industries are now having to navigate through uncharted territory.



Real estate, insurance and legal industries in particular are facing significant hurdles when closing deals, and services like title insurance have never been more important.

In our current landscape, residential and commercial transactions are faced with the possible closure of municipal offices, leading to potential delays in receiving responses to important inquiries, such as work order searches, property taxes and municipal agreement compliance. In addition to relying on traditional in-person customer service, the industry is faced with closures of land titles and registry offices and many provincial law societies are reviewing the rules around the proper means for legal professionals to fulfill their responsibilities.

Across all real estate transactions, these significant changes have opened the door to more vulnerabilities when closing deals. But it’s important to remember that there are services available to protect against these vulnerabilities, such as title insurance, that can ease even the slightest bit of worry amidst uncertain times.

One of the main vulnerabilities that has become more prevalent in recent years is mortgage and title fraud – one of the most common and devastating types of fraud for property owners. Title fraud often starts with a fraudster posing as the property owner, using fraudulent documents to transfer and mortgage a property under their name. In more complex examples, homeowners may be scammed into transferring their property title to a fraudster as a way to complete a fraudulent mortgage transaction. The fraudster will pose as a credible third party, keep the transferred funds and often resell or remortgage.

As we navigate today’s reality, with COVID-19 forcing doors to close and transactions to be completed digitally, this becomes even more probable. However, even in this new digital landscape, experienced underwriters have the ability to spot suspicious activity and report potential issues to all involved parties – halting the fraud before it’s able to take place.

While anticipating a crisis of this nature is near impossible, taking precautions to detect and prevent fraud prior to it taking place are necessary.

Title insurance:

Investing in a title insurance policy is critical to protect against devastating loss caused by mortgage and title fraud. These policies protect against fraud by ensuring that any red flags are raised and investigated by experienced and highly skilled underwriters, and unlike traditional insurance policies, title insurance policies go the extra mile to protect against unknown issues that have occurred prior to the policy’s effective date.

Gap coverage:

To help alleviate some of the worries that come from unforeseen delays caused by COVID-19, gap coverage is also an advisable option. Recognizing this need, FCT extended its gap coverage at no additional cost during this time to ensure that regardless of disruption related to provincial land titles/registry offices, mortgage funds are able to advance without restrictions. By taking advantage of gap coverage, protection is provided for any loss that occurs between when a title search is conducted and when the closing documents are registered.

COVID-19 continues to present an array of new challenges. While it’s difficult to anticipate what could happen during these uncertain times, organizations across industries are putting customers first to do what they can to minimize disruption. For real estate transactions, title insurance companies are in a unique position to take on manageable risk to help lawyer, lender and owner customers continue to operate as usual.

As we look forward, there are many measures in place to minimize disruptions to the closing process, detect and prevent fraud before it occurs, allow deals to close with confidence and help navigate through this unpredictable and unfamiliar territory. The list of unknowns is endless, but one known is constant: there is a solution to every challenge and as an industry, we’re here to help.

Lori Sartor, M.B.A., is vice president, residential solutions for FCT. She also sits on the Board of Directors of the Mortgage and Title Insurance Association of Canada. Eric C. Haslett B.Comm, LL.B is vice president, commercial solutions, responsible for leading FCT’s Commercial Solutions Division, including overseeing product development and operations. Eric joined FCT in 2001 as national commercial counsel and has evolved with the company, serving with great distinction in several different roles.

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