ING Canada promotes risk-based regulation

ING Canadas insurance subsidiaries will be adopting the Insurance Bureau of Canada (IBC)’s Standards of Sound Marketplace Practice, the company announced at its AGM on May 16.
The primary objective of the IBC standards is to encourage the adoption of a risk-based model for the insurance regulatory environment.
The standards are also designed to improve corporate governance and better protect consumers’ interests.
ING said it favoured the risk-based regulatory approach over the current rules-based focus. A rules-based regulatory approach, the company observed, includes specific and rigid measures that directly regulate insurance products, their pricing and sales.
“By adopting the IBC standards, we are promoting a regulatory framework that allows for a more open, market-driven environment, which will encourage more competition, greater innovation and result in better outcomes for consumers,” ING Canada president and CEO Claude Dussault said in a press release. “Quebec’s current regulatory model is the most similar to the proposed framework and as a result its insurance market is one of the most vibrant and innovative in Canada.”
The IBC standards call for:
competitive products that meet the unique needs of customers;
informed and transparent sales transactions;
competent and professional insurance representatives that conform to a specified code of ethics;
fair claims settlement and claims handling; and
timely, accessible and responsive claims handling.
ING said many of its practices already follow the IBCs standards, but where some adaptation of the IBCs standards is necessary, the company has committed to implementing the IBC’s standards by the end of 2007.
“It is our sincere hope that over the same timeframe, provincial regulators will initiate the process of reviewing and eliminating unnecessary rules that have served to limit the benefits of a free and competitive marketplace for consumers,” Dussault said.