Effective July 13, 2020, existing inactive and Pending Type 1 claimants, who have not yet had their foundations remediated, will be able to transfer their claims, registered with CFSIC, upon the sale, transfer or conveyance of the home in question to another party.
(From inception, CFSIC has always permitted those claimants designated as “active” to transfer their claims.)
Claimants with questions about how to transfer an existing active, inactive, or Pending claim should contact ESIS ProClaim by email at cfsic@esis.com or by phone at (844) 763-1207. Your best source of claim transfer assistance will be ESIS.
What follows provides homeowners with detail about how the claim transfer process works.
First, it’s important to note that Type 2 claimants cannot transfer their claims.
Additionally, effective November 16, 2021 at 5:00 PM, CFSIC will not permit a claim to be transferred unless the Original Claimant (claimant transferring the claim) has taken all steps necessary to complete the claim transfer process within no more than a total of 30 days from the date of sale, conveyance or transfer of a fee simple interest in the property covered by the original claim.
Understanding the Paperwork (Transferring a Claim)
To transfer a CFSIC claim, some forms need to be completed. Here’s what they are:
- The Claim Transfer Data Form: This is a simple form completed by the Original Claimant indicating that the claimant wishes to transfer the claim (see Step 1 below for more information).
- The Claim Transfer Agreement: This is a form provided to the Original Claimant by the Superintendent’s office making it clear that the duties and rights associated with the claim will be transferred to a new homeowner (see Step 2 below for more information).
- Cancelling the Construction Contract: If a signed construction contract exists for the claim, the contract needs to be cancelled (see Step 3 below for more information).
- Acknowledging the Contract Termination: If a signed construction contract exists for the claim, a form must be completed by the contractor acknowledging to CFSIC the termination of the construction contract (see Step 4 below for more information).
- Terminating the Participation Agreement: If a countersigned Participation Agreement has been issued by the Superintendent’s office, it must be terminated (see Step 5 below for more information).
PLEASE NOTE that your particular claim may be transferred at any point in your claim adjustment process prior to the commencement of construction, and as a result all these steps may apply to you, or as few as just the first two may apply.
Duties of Original Claimant and Contractor
With respect to the transfer of a Type 1 claim through the sale, transfer or conveyance of an eligible residential building, the following steps in the process will apply:
(The claim transfer process can happen very quickly. Following these steps will make the process smooth and effective.)
Step 1: Requesting a Claim Transfer Data Form from ESIS ProClaim (claimant responsibility)
Prior to the transfer of a claim being made, the existing Active, Inactive, or Pending claimant (Original Claimant) will request a Claim Transfer Data Form from ESIS ProClaim. ESIS ProClaim will provide the Original Claimant with this form, for which it will be the Original Claimant’s sole responsibility to complete and to return to ESIS, and where the data in this form provides the necessary claim transfer information. (ESIS ProClaim will not accept a Claim Transfer Data Form from anyone except an Original Claimant or appointed counsel to that claimant. ESIS ProClaim will not accept a form transmitted by a realtor or by the purchaser of the property in question.) Claim Transfer Data Forms can be returned to ESIS ProClaim as an email attachment, by fax, or by US Postal Service. The form cannot be uploaded using the electronic application portal located on the CFSIC website.
Step 2: Completing the Claim Transfer Agreement for the Superintendent’s Office (joint responsibility claimant/Superintendent)
Upon successful completion of the Claim Transfer Data Form, ESIS ProClaim will alert the Superintendent’s office that a claim can be validly transferred using a Claim Transfer Agreement (PDF). The Superintendent’s office will contact the Original Claimant and will provide a Claim Transfer Agreement whereby the Original Claimant will transfer certain rights, duties, and obligations to the new owner of the property in question (Transfer Claimant). The Superintendent’s office will only provide to and accept Claim Transfer Agreements from the Original Claimant or Original Claimant’s counsel; it will not accept a Claim Transfer Agreement from a real estate agent or the new owner of the property in question.
Step 3: Cancelling the Construction Contract (only if applicable; joint responsibility claimant/contractor)
If a valid construction contract has been entered into between the Original Claimant and a CRCOG-approved contractor, the Original Claimant must contact the contractor, and the Original Claimant and the contractor will be required to mutually agree in writing to void any existing contract and provide evidence of this to ESIS ProClaim.
Step 4: Termination of Contractor Acknowledgment (only if applicable; joint responsibility Superintendent/contractor)
If a valid construction contract has been entered into between the Original Claimant and a contractor, the contractor must complete a Termination Agreement voiding the original Contractor Acknowledgment covering the project and provide it to ESIS ProClaim. If CFSIC has paid the contractor a deposit on the construction to be performed, the contractor must return the deposit at the same time the Termination Agreement is returned to ESIS ProClaim. Upon return of the deposit in full, the Superintendent will countersign the contractor’s Termination Agreement.
Step 5: Termination of Participation Agreement (only if applicable; joint responsibility claimant/Superintendent)
If the Original Claimant has a fully executed Participation Agreement with CFSIC, ESIS ProClaim will provide the Original Claimant with a Termination Agreement, terminating any existing fully executed Participation Agreement. The Original Claimant will sign the Termination Agreement and return it to ESIS ProClaim for countersignature by the Superintendent. ESIS ProClaim will then provide a fully-executed copy to the Original Claimant.
At the end of this transfer sequence...whether the sequence has entailed just the first two steps or all five...the claim officially transfers from the existing claimant to a new claimant (homeowner) provided that the entire process (whether two steps or five steps) has been successfully completed by the Original Claimant within no more than a total of 30 days from the date of sale, conveyance or transfer of a fee simple interest in the property covered by the original claim.
Duties of Transfer (New) Claimant and Contractor
With the registered claim on the property in question now transferred, the Original Claimant’s duties and obligations are completed. The Transfer Claimant (the new claimant) must now take specific steps.
Understanding the Paperwork (a Transferred Claim)
Now that the claim has been transferred, some paperwork (where applicable) needs to be completed. Here’s what’s needed:
- New Construction Contract: This is either a new construction contract with the contractor who had been chosen by the Original Claimant...or is a new construction contract with another eligible contractor (see Step 1 below for more information).
- New Contractor Acknowledgment: Once a new construction contract has been entered into, the contractor must acknowledge it to CFSIC (see Step 2 below for more information).
- New Participation Agreement: CFSIC will require a new Participation Agreement on the transferred claim (see Step 3 below for more information).
Step 1: New Construction Contract
The Transfer Claimant is now free to engage with the contractor with whom the Original Claimant had entered into a contract, OR to obtain a minimum of two contractor proposals from the CRCOG list of approved contractors. If the claim transferred was an active claim including a signed construction contract (whether or not such claim was under a Participation Agreement at the time of transfer), the Transfer Claimant has 180 days from the effective date of the Claim Transfer Agreement, to enter into a signed construction contract, inclusive of the process of having obtained a minimum of two contractor proposals from the CRCOG-approved list for prior approval by ESIS ProClaim, and to provide the final signed contract to ESIS ProClaim.
The failure of a Transfer Claimant to enter into a final CFSIC-approved construction contract within 180 days from the effective date of the Claim Transfer Agreement removes the Transfer Claimant as a claimant from the CFSIC program.
Step 2: New Contractor Acknowledgment
The chosen contractor will be required to provide ESIS ProClaim with a new Contractor Acknowledgment covering the remediation work specified in the approved contract.
Step 3: New Participation Agreement
The Transfer Claimant will be required to enter into a new Participation Agreement covering the claim, and will be required to provide, prior to the countersigning of the Participation Agreement by the Superintendent, a copy of the recorded deed covering the transfer of the eligible residential building in question.
Inactive and Pending Claimant Considerations
Inactive Claimants
By definition, Inactive claimants are not covered by Participation Agreements, do not have signed construction contracts, and no construction deposits have been paid by CFSIC. A copy of the recorded deed transferring the home in question will be required.
As a result, inactive Original Claimants will need to follow the process noted above only with respect to obtaining the Claim Data Transfer Form and eventually entering into a Claim Transfer Agreement (Steps 1 and 2 only of Original Claimant duties).
Pending Claimants
By definition, Pending claimants are not covered by Participation Agreements, do not have signed construction contracts, and no construction deposits have been paid by CFSIC. A copy of the recorded deed transferring the home in question will be required.
As a result, Pending Original Claimants will need to follow the process noted above only with respect to obtaining the Claim Data Transfer Form and eventually entering into a Claim Transfer Agreement (Steps 1 and 2 only of Original Claimant duties).
Additional Considerations
CFSIC will only accept, as evidence of the transfer of an eligible residential building, a copy of the recorded deed.
The Original Claimant and the Transfer Claimant will agree that, upon the signing of the Claim Transfer Agreement, the claim transfers at the status and the financial value existing at the time the agreement was signed, to the extent that value has been determined. The Transfer Claimant will accept the status of the claim as transferred, inclusive of the Original Claimant’s application and all points of evidence as these are in existence at the time the claim transfer is effected. CFSIC will not require a new commercial insurer declination from a Transfer Claimant upon the effective transfer of a claim, if CFSIC is in possession of a commercial insurer’s written declination letter from the Original Claimant as of the date the transfer is effected. If no commercial insurer’s written declination exists on the effective date of the Claim Transfer Agreement, the Transfer Claimant will have to obtain a declination letter. Similarly, if an Original Claimant transfers a claim to a Transfer Claimant where the Original Claimant has received or is scheduled to receive a full or partial claim payment or settlement from a commercial insurer on or before the date of transfer, the claim is transferred to the Transfer Claimant with the understanding that CFSIC will offset any payment to the Transfer Claimant taking into account the commercial insurer’s contribution to the claim filed by the Original Claimant, and where payment or settlement was or will be provided to that Original Claimant by such commercial insurer, it being agreed and understood that CFSIC is secondary, at all times, to any payment or settlement made by a commercial insurer with respect to a claim, and that, as a result, the Original Claimant and the Transfer Claimant agree that the claim transfers on the effective date of transfer at its applicable CFSIC valuation, with CFSIC’s secondary payment position in full understanding.
CFSIC will not permit the transfer of a claim where any aspect or phase of foundation remediation/construction is already underway, including but not limited to the movement onto the property of construction equipment or materiel.
Finally, please note that the transfer of a CFSIC claim can occur only once: from the Original Claimant (our originally registered homeowner) to a Transfer Claimant (new homeowner). It can never be transferred again. Said another way, if you are a Transfer Claimant, your claim cannot be transferred by you to anyone else.