What insurers can expect from FSRA’s review of home insurance claims

Ontario’s insurance regulator is conducting a review of home insurance claims handling to help the industry identify the greatest risks for consumer harm. 

Initially announced in June 2023, the Home Insurance Thematic Review is on its way to being published, after which its findings will be shared with the P&C industry, representatives of the Financial Services Regulatory Authority of Ontario (FSRA) said during its 2024 FSRA Exchange Event in Toronto.

Huston Loke, executive vice president of market conduct at FSRA, explained the reasoning for why the regulator is undergoing this review.  

“I think it’s fair to say that many consumers don’t know exactly what’s going on in terms of their policy and coverage and so on,” Loke said.  

Factors contributing to consumer confusion could range from climate change, differing claims expectations and insurance costs, he suggested.  

“We decided that we would work with insurers to determine what the complaint handling processes, and the claims handling processes, yielded.” 

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Other potential issues may stem from insurers’ outsourcing of claims management and distribution, FSRA wrote in its announcement.  

“We know that from time to time, there are issues in terms of getting adjusters on site, because that’s part of what happens when there’s 10 [catastrophe] events,” Loke said. “We know that there are situations where customers aren’t happy yet. And that’s where the complaint handling piece comes in. But what’s more challenging is to figure out what can be done to help with this. 

“We have come up with a few mechanisms that will assist in adjuster capacity, and we’re working with our partners across the country and learning more about how they do the same,” Loke said. 

The report will provide suggestions for handling home insurance claims and identify contributing factors that may cause consumer harm.  

For example, “We think it is important to state the timeliness with which your claim is handled, and the ability to have feedback and information to a customer,” he said. “Those are important factors that are part of fair treatment.” 

The report will also provide the disclosures that homeowners will need in order to “make the best decision” for their homes.  

Feature image by iStock.com/Solidago