April 8, 2004 by Canadian Underwriter
The Canadian Council of Insurance Regulators (CCIR), coming off their spring meetings, has released feedback on the January discussion paper on referral agreements.
Among the respondents is the Registered Insurance Brokers of Ontario (RIBO), which outlined its policy on referral agreements and some of the instances in which that policy has been used to deal with “consultants” charging a fee to refer someone to a broker. We take action against the individual doing this on the basis that RIBO requires “insurance consultants” to be licensed brokers, but we also have jurisdiction to go after any brokers who are part of these arrangements because fees to non-regulated financial service providers are not permitted,” notes RIBO CEO Jeff Bear. “We consider such jurisdiction to be an important regulatory tool for public protection.” Bear notes that the exception to this would be “networking” arrangements, and the Canadian Association of Direct Response Insurers (CADRI) also noted that it would not want to see networking arrangements deterred.
In his response to the CCIR, CADRI president Andrew Rogacki notes, “CADRI is very supportive of a move that would allow referrals of insurance business from a variety of sources. We feel the professionalism of the agent fulfilling the contract will provide the necessary consumer protection.”
Also at the spring meetings, regulators looked at the automobile insurance statistical plan and reciprocal licensing standards for agents/brokers.