IBC calls on Ontario to adopt file-and-use process for private passenger auto insurance
Changes could be coming to the way in which auto insurance rate changes are implemented in Ontario. According to Canadian Underwriter, the Insurance Bureau of Canada (IBC) has released a paper calling for the province to adopt a file-and-use processing system for private passenger auto insurance.
In insurance, file-and-use refers to regulation by which companies can begin using new consumer rates prior to receiving relevant government approval. The institution through which Ontario drivers seek this approval is the Financial Services Commission of Ontario (FSCO). All changes are subject to an extensive review. As a result, "Insurers often have to file hundreds of pages of documentation and wait several months even for a small price adjustment," notes the IBC.
On top of the file-and-use proposal, IBC, in its recommendations, is looking to increase insurance efficiency all across the board. It wants FSCO to also "amend the prescribed insurance forms to include the necessary data collection and consent provision disclosure statements that would allow consumers to enter into contracts and deliver and/or receive information electronically [....which] should include the use of e-signatures."
This initiative comes as part of Ontario's Red Tape Challenge, a government-run consultation program that was created in order to do away with unnecessary practices that are draining businesses' time and resources. In total there are six different broad areas of consultation that the provincial government is looking to tackle: automotive parts manufacturing, food processing, financial services (what this proposal falls under), mining, chemical manufacturing, and forestry. Consultations began last spring and will fully conclude in winter 2018.