October 22, 2009 by Canadian Underwriter
Members of the Insurance Brokers Association of Ontario (IBAO) who do not support the association’s call for an “outright ban” on credit scoring need to “get in the game,” IBAO president Peter Blodgett said in a speech made at the IBAO’s 89th annual convention in Toronto.
The IBAO in May 2009 called on Ontario’s insurance regulator to consider expanding its existing prohibition on the use of credit scoring for the purpose of underwriting auto insurance, so that the prohibition would apply to homeowner lines as well.
Several insurers support the use of credit scoring to help rate a consumer’s risk, although there isn’t unanimity among insurers on this point. And so the call for a wider ban on credit scoring has some insurers openly wondering whether the broker association’s position reflects the entire membership.
Blodgett, the outgoing president of the IBAO, acknowledged that some of the IBAO’s members think an “outright ban” may be going to far. But to these members, he issued a direct call to action.
“Our request in [May 2009] has now moved for asking for an outright ban on credit scoring, which I strongly support, and my hope is that our voice will be heard loud and clear,” Blodgett said. “We do, however, have some of our members who are opposed to our position.
“May I suggest it’s time to disregard insurer propaganda and get in the game.”
Blodgett likened the IBAO’s battle against credit scoring to the brokers’ fight against banks on the issue of banks selling insurance on their Web sites.
In both cases, brokers are “doing what we can to ensure that all Canadians are protected and treated fairly,” said Blodgett. “The use of credit is an evil that will do no more than increase cost for those who can least afford it and change our role from a professional advisor to a mere credit counselor.”
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