What is Tarion Warranty and Who Is Responsible for Paying the Tarion Warranty?

Tarion Warranty is paid by the builders. Condominium Tarion warranty is paid 30 days prior to construction and upon before or on the day a permit is issued for freehold home. The cost of the Tarion Warranty is set based on the value of the sale price. Builders will either include it in the sale price or insert the cost into the statement of adjustments upon closing. Please see the table below to view how it is it calculated.

Tarrion Warranty Calculation Table

 

What is included in the Tarion Warranty?

  1. Deposit Protection - For condos up to $20,000 (the rest held by the Trust provisions of the Condominium Act). For freehold up $40,000 (if signed prior to 2003 then $20,000) ** Upgrades and extras may not be covered.
  2. Financial Loss Protection - If the builder fails to substantially perform the contract you may be entitled to the difference between the amount paid and the value of the work.
  3. New Homes - 1 & 2 year protection against defects in workmanship & 7 years against structural defects
  4. Condos - include shared area, coverage beings the day the condominium is registered. Common elements are not covered.
  5. Unauthorized Substitutions - THe builder must gain receive the purchaser's consent to substitute finishes

What is Excluded in the Tarion Warranty?

  1. Damage resulting from improper maintenance
  2. Alterations, deletions or additions made by the homeowner
  3. Defects in materials, design and work supplied or installed by the homeowner/purchaser
  4. Damage caused by the homeowner or visitors
  5. Normal Wear & Tear
  6. Third Party Damages
  7. Secondary/Consequential Damage (damages caused by a defect that is covered by warranty)
  8. Supplementary Warranties/Agreements (,s which are above and beyond the warranty of Tarion)
Note: The Pre-Delivery Inspection and completion of a PDI Form during this inspection are very important in terms of resolving potential disputes about who is responsible for damage in the home. If you are claiming an item of damage that is not listed on the PDI Form, it will be important for you to provide some explanation as to how the damage was caused and why it was not listed on the PDI Form (for example, if the damage was caused later during repair work to the home).