June 18, 2010 by Canadian Underwriter
Having secured Finance Minister Jim Flaherty’s commitment to prevent banks from selling unauthorized insurance on their Web sites, the Insurance Brokers Association of Canada (IBAC) is concerned that banks have already responded by trying to promote insurance on consumer’s cell phones and personal digital assistants (PDAs).
IBAC is currently awaiting draft regulations that would prohibit banks from selling “unauthorized” insurance on their Web sites. It’s a move IBAC applauded at the Insurance Brokers Association of B.C.’s 62nd Annual Conference & Trade Show on June 17.
“This, my friends, has been a great win for consumers,” IBAC president Justin MacGregor said in a speech to conference delegates. “Banks have been working around the rules now for many years, and trying to find every way they can to promote insurance both in the branch, next door, online, ATMs and now with PDAs and cell phones….
“This announcement is the right policy decision from the government and I think we need to applaud them for making the right decision.”
MacGregor added IBAC’s lobbying efforts have not ended at Flaherty’s proposed new legislation related to Web sites. He reminded brokers that an outstanding, comprehensive private member’s bill, Bill C-457, would expand the prohibitions of banks selling insurance. Quebec Liberal MP Alexandra Mendes introduced the bill in October 2009.
“There’s a private member’s bill that would in essence forbid any promotion whatsoever of any insurance product by banks in Canada – in the branch, next door, on the Internet, ATMs, cell phones and PDAs,” MacGregor said. “Based on this bill, they would not be able to do any kind of prohibited insurance promotion.
“That bill is still on the House agenda, and at IBAC, we think that’s the right way to go.”