Legal federation shares guidance for lawyers tackling title insurers’ reporting obligations

The Federation of Law Societies of Canada has announced that it has published guidance addressing client consent, professional obligations, agency agreements, and other important considerations for legal professionals dealing with title insurers’ reporting obligations taking effect this October. 

As of Oct. 1, 2025, the Regulations amending certain regulations made under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2000 (PCMLTFA) will recognize title insurers as reporting entities. 

In its news release, the FLSC said these regulatory changes will affect real estate transactions and require title insurers to report certain information, including suspicious transaction reports and terrorist property reports, to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). 

The FLSC’s news release added that its new guidance seeks to illuminate what lawyers should consider before entering into agency agreements with title insurers while representing clients in real estate transactions and how to safeguard client interests while complying with their ethical duties. 

Lawyers’ obligations

In its guidance, the FLSC emphasized that legal professionals should obtain a client’s full, informed, and voluntary consent before disclosing any confidential or privileged information to a title insurer. 

According to the guidance, the information relevant to a client’s decision includes information and verification records and the fee a lawyer will receive as the title insurer’s agent. 

The guidance provided that legal professionals should consider their ethical and professional duties to their clients, including those involving confidentiality and solicitor-client privilege. 

The guidance stated that lawyers should advise clients of risks associated with an agency relationship with title insurers, including the potential for a title insurer to report information shared with it to FINTRAC. 

The guidance noted that legal professionals should document the steps taken, ensure that they get the client’s written consent, and consider the terms of any applicable agency agreement. 

Insurers’ obligations

Apart from submitting the required reports to FINTRAC, the guidance explained that title insurers should also establish an anti-money laundering compliance program, comply with identity verification and record-keeping requirements, and abide by ministerial directives. 

The guidance added that title insurers should record the following information on a client’s identity: 

• the purchaser’s name, address, and date of birth 
• the property’s legal description and address 
• the purchase price 
• the closing date 
• the mortgage amount 
• the lender’s name 
• the seller’s name, if known 
• the title information the land registry provided 

The guidance noted that title insurers could retain lawyers or other agents to verify the client’s identity in keeping with their regulatory obligations.