REIX: Real Estate Insurance Exchange - Alberta, Saskatchewan

We’re a non-profit organization which means that premiums are used to pay the costs of defending claims and surplus funds are used to keep premiums low.

Artificial Intelligence In Real Estate

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AI In Real Estate

Over the past few years, Artificial Intelligence has made its way into people’s everyday lives, from chatbots and homework research to virtual assistants and social media content generation. But should you use AI to produce your real estate documents or listings?

Use it as a first draft? Sure. Rely on it? Absolutely NOT.

As it gains sophistication, AI has become a useful tool that can greatly improve a professional’s productivity and efficiency. But it is far from perfect; it doesn’t truly understand the audience or anticipate expectations of clients nor is it cognizant of real estate case law or privacy considerations. It is up to you to carefully review any AI-generated content to correct misinformation, so the end result is an accurate representation of the property you are tasked with selling, buying or leasing.

REIX subscribers are noticing errors caused by a lack of oversight and/or editing of AI-generated copy. While some errors seem insignificant, like mistaking laminate for granite, Dale Ripplinger, Former REIX Advisory Board and Nominating Committee Chair, and Branch Manager at Realty Executives Diversified in Regina, fears that these errors can erode the trust and confidence clients place with their representatives.

“I think the use of AI in listings is dangerous from a liability point of view but even more so as a threat to our perception of professionalism by the public. This is a tool which must be used prudently,” he says. “Using AI in a listing without proper oversight is like driving while texting. Just because we have the technology doesn’t mean that we always need to use it.”

Your clients trust that you as the industry professional are well acquainted with the property in question. You have a fiduciary duty to your clients to represent their interests to the best of your ability. That includes ensuring every aspect of a listing, including segments contributed by AI, contains information that is accurate and verified before signing off on it.

While AI is useful for preparing listings, REIX strongly recommends that industry professionals review everything that is produced by AI, and DO NOT use AI to draft Contracts and Forms; always use association or board forms whenever possible.
Artificial Intelligence can be a great support tool but there is no substitute for conscientious attention to the details. AI has a place in the future of the real estate business, but it takes a backseat to the knowledge and professionalism of the industry members using it.

If you have any questions, concerns or have been served with a lawsuit/demand letter contact REIX immediately at admin@reix.ca.

 

2022 Breaks Claims Records for REIX: Safeguard Yourself Against Future Claims!

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2022 Breaks Claims Records for REIX: Safeguard Yourself Against Future Claims

 

A substantial increase in claims during the 2022 Policy Year has led REIX to caution subscribers to take measures to minimize such occurrences to prevent a potential premium increase.

The most recent claims year, ending this September 30th, was the highest in 11 years, with 103 claims total.

Key factors worth noting in the high number of claims is an increase in carelessness, miscommunication, and a lack of attention to detail when reviewing documentation.

Here are the top 5 actions subscribers can take to help reduce the number of claims:

  1. Review all documents, offers, and contracts two or three times before distributing. This includes (but is not limited to) reviewing the Title, MLS Listings, and RPRs. If anything seems concerning, investigate and verify the information. Do your due diligence.
  2. Review everything with clients to ensure they understand what they are signing, agreeing to, or offering. Ensure that your clients are aware of any risks they could face when they are giving instructions (such as risks with unconditional offers or risks of a deal collapsing).
  3. Follow up on every verbal conversation with an email confirming the disclosures that were made, instructions that were given, and risks that were explained.
  4. Do not make any representations or give advice on anything that is outside of your scope; encourage your clients to seek advice from a third-party professional.
  5. Do not rely on a previous MLS listing. Verify everything and have your sellers sign off on all the information and details you are inputting on the MLS listing/feature sheet. Additionally, if you are using AI technology to create your listing (or any other documents), ensure you are reviewing and verifying all the information for accuracy prior to posting or submitting it.

As soon as you become aware of a claim or a potential claim:

  • DO talk to your broker immediately.
  • DO report this to REIX right away; whether you are served with a Demand Letter, Statement of Claim, or a Civil Claim, there are deadlines for REIX to file a defense on your behalf.
  • DO gather all relevant documents related to the claim and prepare a detailed chronological summary of the background events and discussions giving rise to the claim, as soon as possible and provide all of this to REIX.

As soon as you become aware of a claim or a potential claim:

  • DO NOT admit responsibility, offer to pay money, or provide additional services without REIX’s consent, even if you think you have made an error or omission, as this may jeopardize your coverage.
  • DO NOT communicate, correspond, or produce any documents to any other party named in a lawsuit. Doing so may prejudice your defense and coverage.
  • DO NOT wait to report a claim or potential claim to REIX as this is wasted time and could harm the outcome. The sooner you contact REIX when you feel a deal is starting to go sideways, the better chance there is of REIX being able to help secure a positive outcome.

The most effective course of action is to proactively prevent such claims from occurring in the first place and ensure that you are acting responsibly while consistently fulfilling your obligations as a subscriber.

To quickly report the incident, REIX recommends bookmarking the following claims or potential claim link: https://reix.ca/wp2024/wp2024/claims/how-to-report-a-claim-or-a-potential-claim/.

To find out more information about how to avoid claims related to mortgages and rising interest rates, check out our blog entitled The Effects of Mortgage Rate Hikes on Housing: Crucial Insights for Real Estate Professionals for some helpful tips.

When questions or concerns arise, reach out to REIX at admin@reix.ca for support.

 

Disclosing Suicides and Violent Crimes (UPDATED)

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REIX’s post Disclosing Suicides and Violent Crimes, dated September 15th, says that “while there is no law, or statute requirement, that requires disclosure, there is no question that you must disclose it.”

REIX would like to issue a clarification pertaining to the above. While it is not required that real estate agents must disclose whether a violent crime has been committed on a property, as your insurer, we recommend that it be disclosed to avoid potential lawsuits, and to make it easier for us to defend you in legal actions that arise from issues such as this.

Please see below for the updated blog post.

 

As real estate agents, you’re often faced with difficult decisions – least of all what you should and shouldn’t disclose.

So it’s no surprise that we’re often asked if suicides and violent crimes that occur on properties should be disclosed.

REIX recommends that best practice is to disclose it.

While there is no law, or statute requirement, that requires disclosure, REIX recommends that you disclose it to avoid any potential lawsuits. Without intending to be funny, if you don’t make the disclosure, the neighbours most assuredly will and likely on the day the buyer moves in.

It is advised that an industry member should handle situations like this with tact, sympathy and above all, diplomacy.

So how and when should the matter be disclosed and what do you do to protect both yourself and the other parties to the transaction?

How and When to Disclose

If you’re representing both the buyer and seller, then you should make the disclosure before you write the offer, adding a note in your file indicating the date, time and person(s) to whom you made the disclosure.

If you’re only representing the seller, then the disclosure is made to the buyer’s real estate agent, either before the offer is written (if you are aware in advance that an offer is coming) or before the offer is presented.

Again, ensure you have a note in your file that indicates the date, time and person(s) you made the disclosure to.

Addendum Recommended

Finally, we recommend an addendum be written up and included as part of the purchase contract. It should say something to the effect of “seller has disclosed and the buyer acknowledges that they have been informed of a suicide/violent crime on this property.”

By dealing with suicides and violent crimes in this way, you are being sensitive to the seller’s needs, informative to the buyer’s needs, and protecting both yourself and the parties to the contract from liability arising out of the failure to disclose.

The Real Estate Insurance Exchange (REIX) provides mandatory errors and omissions insurance to over 14,800 Alberta and Saskatchewan real estate industry members and nearly 1,200 brokerages. We’re dedicated to providing high value to our subscribers through exceptional claims, risk and financial management. Be sure to follow us on Facebook!

We Want YOU To Be a Board Member!

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Each year, we look for diverse, experienced Advisory Board members who can share their experience – and this year’s no different.

The REIX Nominating Committee is seeking licensees in all sectors of real estate from across Alberta and Saskatchewan to serve on our Advisory Board and Claims Committee.

“The decisions we make as an Advisory Board are so important to how REIX functions as an organization and in the real estate community,” says REIX CEO Lisa Sabo.

If you are keen to get involved, learn about your insurer from a unique perspective or gain experience as a board or committee member, you may just be the perfect fit.

We’re looking for candidates with knowledge, skills or interests in one or more areas of Board governance and leadership, including strategic planning, fiscal oversight, risk management and loss prevention.

Three Meetings a Year

Not only will you gain – and share – insights and knowledge, but the time commitment is manageable, with only three Advisory Board meetings each year (held in October, February and June).

All appointments will be made at our June 2022 meeting to begin service in October 2022. While Advisory Board appointments are two one-year terms, followed by two three-year terms, for a maximum of eight years, Claims Committee appointments are for a one-year term, for a maximum of eight years.

“We encourage everyone who is interested to apply.  We thoughtfully consider all applications. Our goal is to have our Board reflect the diversity in our real estate community,” says Lisa.

If you would like to volunteer, please download the Nomination Information Form and submit it to REIX Admin at admin@reix.ca. All applications must be received by April 7, 2022.

The Real Estate Insurance Exchange (REIX) provides mandatory errors and omissions insurance to over 14,800 Alberta and Saskatchewan real estate industry members and nearly 1,200 brokerages. We’re dedicated to providing high value to our subscribers through exceptional claims, risk and financial management. Be sure to follow us on Facebook!

The Art of Deception Detection

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How to Detect Deception – bodylanguagetrainer.com

 

We’ve all heard of a lie detector test, but what if we could tell if someone was lying just by looking at them?

According to body language and fraud detection expert Traci Brown, you can.

Brown was the keynote speaker at REIX’s recent 30th Anniversary virtual event, where almost 200 attendees learned how to detect deception.

Brown shared key tips, tricks, facts and myths to help subscribers hone their lie detection skills – and it starts with a baseline.

According to Brown, there is no single move that indicates lying for everyone, which is why it’s essential to first get a baseline for their behaviour and then look for differences in each person’s baseline. How do they normally gesture and move? What patterns do they follow? How often do they blink?

Once a baseline is established, then the detection begins! Observe the person in four stages: as a question is asked, while they’re thinking about the answer, while they’re answering the question, and after the answer.

Telltale Signs

If you noticed any telltale signs, you may have spotted a lie. Brown says when you see three to five signs in a tight cluster, such as within one sentence, it often indicates deception. They may also be accompanied by a shift in tone or even a change in the pace of their speech.

Brown says it’s a myth that liars will look away and won’t make eye contact, and says that, in fact, they often look at you more to gage your reaction. Another myth? Looking up and to the left indicates a lie. The fact is, everyone has unique eye patterns, so Brown suggests you look for a shift in the pattern, not for a specific movement or eye location.

REIX CEO Lisa Sabo says these skills could prove invaluable for real estate agents and brokers day to day.

“It’s important for REIX to do these kinds of events so that we can continuously give back to our subscribers in an educational and, if possible, fun way. Our goal is to give the industry more tools that they can use in both their busy professional and personal lives.”

CEOs, History and Dave de la Ronde, Oh My!

The effort paid off, with event participants providing overwhelmingly positive feedback.

“Traci Brown was excellent, and I loved how interactive she was,” wrote one subscriber.

“I certainly enjoyed the whole event. A combo of business tied in with a great topic, a presentation with Traci and some fun,” wrote another.

Aside from Brown’s fraud detection presentation, REIX’s Senior VP of Claims Dave de la Ronde spoke to how lying can jeopardize your coverage, reputation and career, and the importance of credibility and truthfulness.

Participants were also treated to a history lesson by REIX’s first two CEOs, Merv Borgeson and Harvey Gamble, in an interview conducted by Sabo, who is just the third CEO in REIX’s history.

Finally, five lucky subscribers – Pat Bedry, Bill Kirk, Carole-Anne Brown, Darren DePagie and Lorna Pylychaty – walked away from the event as prize winners. After correctly answering questions about REIX’s history, they were entered into a draw and were randomly chosen to each win a prize package that included access to Brown’s online training Fraud Spotting Online Deception Detection Training, an online copy of her book How to Detect Lies, Fraud and Identity Theft: Field Guide, and a $200 gift card to a local restaurant of their choice.

The Real Estate Insurance Exchange (REIX) provides mandatory errors and omissions insurance to approximately 13,500 Alberta and Saskatchewan real estate industry members and protects them from financial loss due to negligent acts while performing their real estate duties. Follow us on Facebook!

Meet REIX’s New Advisory Board Members!

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As REIX continues to evolve as an organization, we’re focusing efforts on connecting with subscribers through ongoing education and communication while welcoming new perspectives to stay abreast of trends and developments in the real estate world.

One way we’ve harnessed those new perspectives is with the addition of four new board members. The members represent younger real estate agents as well as seasoned professionals with a wealth of board and industry experience.

The new Advisory Board Members are:

Jennifer Gilbert

Based in Lloydminster, AB with Coldwell Banker, Jennifer is a dually-licensed associate broker and property manager in both Alberta and Saskatchewan. She practices in all trades of real estate and has extensive board experience.

Jennifer was a member of the REALTORS® Association of Lloydminster and District Board of Directors from 2010 to 2015 and its President in 2013/2014. In 2016, she joined the Alberta Real Estate Association Board of Directors and served as its Chair in 2019.

Nathan Hong

Nathan is a real estate agent with Calgary’s Charles Real Estate and is licensed in residential and commercial real estate, as well as property management. He holds a BA from the University of Alberta with a double major in economics and psychology, and has experience driving sales and increasing market share through competitive pricing and innovative marketing strategies for a major Canadian retailer.

Vern McClelland

Vern is an associate broker for RE/MAX of Lloydminster, partner with the Midwest Group and fully licensed in both Alberta and Saskatchewan. He was elected to the Saskatchewan Real Estate Commission in 2015 as one of two industry representatives outside of Saskatoon and Regina, and served as Chair for three years until completing his second term in 2021.

In 2014, Vern received RE/MAX International’s Lifetime Achievement Award for distinguished service to the industry. He has also been a contributing editor to The Meridian Source since 2005, writing columns on real estate and community.

Jaison Thomas

Jaison is a Calgary-based real estate agent with CIR REALTY and has been a licensed Commercial and Residential REALTOR® with the Calgary Real Estate Board since 2007. Prior to that, Jaison spent 15 years in sales and business development in the telecommunications, transportation, software and finance sectors.

REIX welcomes Jennifer, Nathan, Vern and Jaison to the Advisory Board, where their energy, experience and industry knowledge will be put to good use.

The Real Estate Insurance Exchange (REIX) provides mandatory errors and omissions insurance to approximately 13,500 Alberta and Saskatchewan real estate industry members and protects them from financial loss due to negligent acts while performing their real estate duties. Follow us on Facebook!