DAILY NEWS Feb 8, 2007 4:25 PM - 0 comments

BC adopts home warranty insurance product procedures

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The Insurance Council of British Columbia (Council) decided to proceed with the implementation of recommendations for the distribution of home warranty insurance products as they were originally published.
In 2006 the Council requested industry feedback on the proposed changes.
Five issues were addressed in the proposal. They include: claim administration; licensing; holding out and fee disclosure; builder security; and cancellation of coverage.
The main concern with claims is the timeliness on which they are addressed, says a Council release.
In terms of claims handling and administration, a person "who undertakes more than a clerical role in claims handling must be licensed as a Level 2 or Level 3 general insurance agent."
Otherwise, home warranty claims must be adjusted by the insurer or a licensed insurance adjuster.
Where fees and disclosures are concerned, any fee over and above the home warranty insurance premium, as determined by the insurer, must be disclosed by the agent to the builder in writing before issuing the home warranty insurance.
Council has also brought the builder security requirements under regulatory purview.
From now on, one of three requirements will apply to insurance agents where security is collected from a builder.
And where the fifth issue is concerned: "Council acknowledges that while an insurance agent cannot de-enrol a specific home construction project, it can refuse to provide warranty insurance coverage to a builder for the purposes of any future project."
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