June 24, 2024

We continue to call for over-arching reform of the auto insurance system in Alberta

May 31, 2024

CADRI supports recommendations by the AIRB that would lead to the simplification of Alberta’s Grid Rating System

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May 22, 2024

CADRI urges Manitoba council to rein in fees 

The Canadian Association of Direct Relationship Insurers has concerns about the Insurance Council of Manitoba’s proposed fee increases for examination fees, general licences for individuals and agencies and the list of agents.

In a recent letter, CADRI acknowledged the council’s status as a self-funded agency, noting that 44% of licence fees, 15% of examination fees and 100% of disciplinary fines are remitted to the government of Manitoba quarterly.

CADRI also recognized that the council’s fee schedule has remained unchanged for 20 years.

The association urged the council to review its budget and reconsider the planned fee increases.

“We encourage the council to be transparent about the benefits that agent and insurer fees contribute to ensuring that Manitobans receive insurance advice from reliable, qualified agents,” association chair and CEO Geoffrey Beechey said. “We would be pleased to explore our position in further detail and consider other options the council may be considering.”

CADRI said in the letter that it appreciated the council’s decision to decrease fees for amending, transferring or reinstating a licence. However, it pointed out that the proposed fee increases would place Manitoba at the higher end of the fee spectrum compared to similar agencies across Canada.

CADRI members, comprising national and international companies, employ licensed agents across Canadian jurisdictions. These agents often secure initial licences in their home province and then obtain and renew licences in other jurisdictions, incurring various fees.

The proposed fee increases would result in higher costs for CADRI members serving insurance customers in Manitoba, costs that insurance consumers would ultimately bear, the association said.

(Copyright Thompson’s World Insurance News.) 

March 18, 2024

Thompson’s News Article: CADRI to FSRA: P&C needs separate regulation

The p&c sector should be treated separately from other financial institutions, the association representing direct marketers told Ontario’s regulator on protecting vulnerable consumers.

In its March 8 submission to the Financial Services Regulatory Authority of Ontario, the Canadian Association of Direct Relationship Insurers suggested a definition change.

“Although FSRA’s proposed approach to strengthening protection of vulnerable consumers covers all its regulated sectors, CADRI submits that FSRA should recognize that the risks facing property and casualty customers are different than those facing life and health customers, mortgage broker clients or deposit-taking credit union members.”

CADRI said that its members have already implemented policies to ensure that all customers are treated fairly, having embraced the Canadian Council of Insurance Regulators’ fair treatment of customers guidance, and subsequently FSRA’s adoption of it.

In its submission, CADRI said auto and home insurance products are similar from company to company and easier to understand than more complex financial instruments with multi-year commitments.

And the risk of harm is more limited when considering p&c, the association said.

“This insurance is a risk mitigation tool; the risks associated with vulnerable consumers might be not getting the right coverage or needing to pay over a period,” CADRI’s submission said.

“There are no assets or funds that someone with malicious intent may seek to access. This distinguishes p&c from other financial sector products.”

The association recommended against creating a stand-alone technical advisory committee for people who need more support.

CADRI also said the current FSRA definition of a vulnerable consumer as “someone who is at higher risk of experiencing financial mistreatment, hardship, or harm due to various factors and personal circumstances” may be too broad.

Some would say that “all of Ontario’s 10 million drivers would have found themselves captured by the definition at least once in their lives,” CADRI said. 

“It should be generally up to the customer to signal the need for additional support.”

(Copyright Thompson’s World Insurance News. 

We suggest to FSRA that existing guidance on fair treatment of individuals needing additional assistance is sufficient for P&C customers

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February 13, 2024

Thompson's News article: CADRI asks to use credit scores for Ontario auto

The Canadian Association of Direct Relationship Insurers wants its members to be allowed to use credit scores in auto insurance ratings in Ontario.

In its pre-budget consultation submission, the association said lower credit scores would translate into lower insurance costs for Ontario drivers.

“We seek automobile insurance that is priced fairly for Ontario’s drivers and a system that sustains competitive insurers to provide Ontario families with greater choice,” the association said in its submission. “To achieve these goals, we recommend a regulatory framework for auto insurance which is principle-based, outcome-focused and efficient.”

CADRI acknowledged that the Financial Services Regulatory Authority of Ontario has been revising its portfolio of rules to ensure that they are consumer-friendly, but pointed out that the provincial government, in its 2019 budget, recommended that ‘drivers should have the choice to lower their premiums by allowing insurers to consider their credit history.’

“We support the Ontario government moving to the next stage in its strategy and providing Ontario drivers with this opportunity.”

The association said that how an individual manages their finances is more predictive of whether they’ll make an insurance claim than other traditional risk variables.

“Credit scores are widely recognized as valid tools to predict insurance claims,” it said.

In provinces like Alberta and Nova Scotia, where credit information can be considered in auto insurance pricing, consumers typically have the option to consent to its use. However, if consumers decide not to provide consent, they won’t be refused insurance coverage.

(Copyright Thompson’s World Insurance News.) 

February 9, 2024

Our pre-budget consultation submission asks government to let Ontario customers allow insurers to use their credit ratings when calculating rates

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