July 9, 2019 by Greg Meckbach
If a vehicle manufacturer wants to write auto insurance in Canada, it would need to have a subsidiary that is approved by the government to write insurance, says Ottawa’s insurance regulator.
Asked whether an auto manufacturer can insure P&C risks in Canada, a spokesperson for the federal Office of the superintendent of Financial Institutions said Tuesday that authorization to insure a risk can only be granted to one of two types of firms.
An insurer must either be incorporated in Canada as a P&C insurance company or be a foreign P&C insurance company that receives approval to establish an insurance branch in Canada, OSFI spokesperson told Canadian Underwriter Tuesday.
“The Canadian or foreign insurance company can be owned by another entity whose primary business may, or may not be, insurance (for example an automobile manufacturer),” OSFI said.
Regulation of brokers and agents in Canada is done by the provinces and territories.
South of the border, Porsche Financial Services Inc. announced June 20 that it will offer Illinois and Oregon motorists insurance through Atlanta-based Mile Auto Inc.
The company plans to expand to additional states in the future.
Though it uses the brand Porsche Auto Insurance, Porsche is not a carrier. Mile Auto does not name its carriers but says its auto insurance is underwritten by a national insurance company rated “excellent” by A.M. Best Company Inc., an Oldwick, N.J. firm that analyzes the financial soundness of insurers.
In the U.S., Mile Auto customers use their smartphones to report mileage once a month, and then pay based on exact miles driven. Mile Auto says its policies make sense for clients who drive 10,000 miles or less a year.
Mile Auto says its policies include at least the minimum liability coverages that are required by the client’s state, with the option for increased liability coverage depending on the client’s needs and budget. A Mile auto policy can also include comprehensive (for non-accident vehicle damage or theft) and collision coverage, as well as rental vehicle reimbursement and roadside assistance.
With Mile Auto, clients “can expect an added layer of privacy,” Porsche said June 20. “Simply take a photo of your odometer to submit your mileage instead of using invasive tracking devices or always-on smartphone apps.”