Insurers understand the need for electronic proof of auto insurance, but don’t yet have the ability to share this information electronically, Steve Kee, director of media and digital communications with the Insurance Bureau of Canada (IBC), said in an interview with Canadian Underwriter.
“[Customers] want easy, transparent and quick online experiences and I think insurers understand this but, unfortunately, don’t have the ability to innovate their products and share information electronically,” Kee said on Monday. “I think this is one thing where people are saying ‘This needs to change’ and we need to put their needs and expectations first.”
Nova Scotia’s insurance regulator in late January became the first insurance regulator in Canada to issue a bulletin approving the use of electronic proof of auto insurance (EPAI).
Canadian Council of Insurance Regulators (CCIR) recommended Tuesday that EPAI be made available across Canada. While provincial insurance regulators have the legal capacity to allow EPAI delivery, CCIR acknowledged that some jurisdictions still have concerns that need to be addressed about the impact of EPAI, such as privacy and liability. “We encourage regulators in jurisdictions where these concerns exist to work with their respective partners to address operational matters, with the aim of implementing EPAI,” said Patrick Déry, chairman of CCIR.
On Monday, IBC released the results of an online survey that found that consumers were “strongly in favour” of being granted the option of carrying their proof of insurance “pink slip” in digital form. In particular, 74% of Ontario residents polled want the option of receiving their insurance documents (proof of insurance card, insurance renewals) electronically.
The survey of 1,210 Ontarians was completed between Jan. 24 and 26, with a margin of error +/- 2.8%, 19 times out of 20. The results found that:
78% of those polled believe that receiving their insurance documents electronically would be convenient;
88% receive at least one bill electronically (for example, phone bill, bank statement); and
79% of those polled believe that insurance information available online is as safe as paper-based communications
The survey results were featured in a report by IBC titled An Innovation Agenda for Ontario’s Insurance Industry. The report outlines the following steps, among others, to make auto insurance more convenient for more Ontario drivers:
electronic proof of Ontario insurance;
allowing insurers to provide consumers with the option of selecting usage-based insurance to help determine the cost of their auto insurance;
integrating the sharing economy – specifically, technology-enabled ridesharing services – into the auto insurance system, so that insurers can offer new products to cover the risks that individuals face while using sharing economy platforms; and
granting both incumbent insurers and new market entrants access to the “regulatory super sandbox” to encourage new innovations that will benefit consumers
Kim Donaldson, IBC’s vice president of Ontario, said the province’s drivers are very supportive of digital documents. “If we use our mobile devices to get on airplanes and buy our coffees, why can’t we use them to display our proof of insurance?” she said.
The speed of technological change has outstripped the pace of policy and regulatory change, added Donaldson. “Ontario’s property and casualty insurers are looking for the provincial government’s commitment to modernize insurance laws to put customers’ needs first and meet their evolving online financial needs.”
Canadian Underwriter contacted FSCO for this story. FSCO indicated that it would be issuing a statement in the future.