Insurer adoption of broker consent language welcomed: IBAO

The Insurance Brokers Association of Ontario (IBAO) announced Tuesday that five of the top 10 insurers in Canada will now accept business quoted using a standardized consent language.

“This wording will enable our brokers to obtain consent on behalf of the insurer in respect to a quotation that includes personal credit information, including credit score, as permitted by law,” says IBAO CEO Randy Carroll, calling this “a big win for the broker network.”

This language is respective to only those quotes where credit is used in the quoting process to determine rate, notes a statement from IBAO.

The language moves the onus of responsibility of consent to the insurer – rather than the broker – for quotations where credit scoring is used to rate or underwrite the policy, IBAO reports. After having worked with insurers to develop the broker consent language and since gaining consensus, the association has sent the wording to its online quote providers for adoption, the statement adds.

“Many brokers do not know that they are exposing themselves to risk when they collect clients’ credit information without consent,” IBAO president Chris Floyd says in the statement. “Under the previous language, brokers were responsible for the collection and use of credit information, even though they were not the ones using it,” Floyd explains.

In addition to five of the largest insurers that have agreed to use the language, each of the broker management system (BMS) vendors have been sent the language to embed into their respective systems, notes the IBAO statement.

The association has not changed its position as it relates to credit scores being used to rate or underwrite insurance, the statement notes. Rather, the wording change merely shifts the onus of responsibility for the collection and use of the information back to the insurer, it adds.