TORONTO, May 1, 2014 /CNW/ - The Insurance Brokers Association of Ontario (IBAO) is delighted that the 2014 Ontario Budget proposes to ban online retailing of unauthorized insurance products. Premier Wynne committed to examining the issue in October 2013 and today we are pleased to see that the government has sided with consumers.
Currently, Credit Unions are prohibited from selling or marketing unauthorized insurance products such as home and auto insurance in their branches. Credit Unions are currently marketing insurance on their credit union websites despite the intent of regulations under the Credit Unions and Caisses Populaires Act that prohibits the promotion or selling of unauthorized insurance products. Banks have the same prohibitions under The Bank Act. Regulations for banks were enacted in 2012 to modernize these protections for the online space.
There are important consumer protection reasons for this policy. It protects consumers who are vulnerable at the point of lending from an obligation to purchase an important insurance product under duress. Credit Unions and Banks provide wealth management services. Insurance products are risk management services that require different competencies. The prohibition also protects consumers from cross-selling tactics from persons not properly trained to provide insurance advice.
"This commitment by the Ontario government is very important for our consumers," said IBAO CEO Randy Carroll. "On behalf of the IBAO I want to give our sincere thanks to Premier Wynne and Minister Sousa. On behalf of all our customers, I want to urge all parties to support this change and pass this budget."
The 2014 Ontario Budget also renews its commitment to encourage insurers to offer usage based insurance (UBI). "It's good to see that this government recognizes this innovative new technology in its 'Fair Society' section. This new technology along with the proper consumer protections will increase fairness in auto insurance particularly for young people," added Carroll.
The Insurance Brokers Association of Ontario (IBAO) is a 'not for profit' association that represents and serves the interests of over 12,000 independent Property & Casualty Insurance Brokers in the Province of Ontario. For information about IBAO, visit www.ibao.org to receive timely news and information updates. You can also follow IBAO on Twitter or join the IBAO Facebook Fan Page.
SOURCE: Insurance Brokers Association of Ontario (IBAO)
For further information: For more information or for interview opportunities, please contact: Emily Reid, IBAO Public Relations, Telephone: 613-233-8906, Email: [email protected]