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What's New
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Saskatchewan-Final Version of ISI Regulations Released
Saskatchewan published in the Gazette of April 16 The
Saskatchewan Insurance Amendment Regulations, 2010.
These regulations set out the restricted license regime
for Incidentally Sold Insurance (ISI). The regulations
permit third parties to be licensed. Mortgage brokers
may also obtain a license for ISI. With respect to
training/ knowledgeable representatives, the regulations
require every restricted licensee and every insurer to
be accountable. The regulations come into effect on
September 1, 2010.
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New Brunswick-Consumer Advocate Annual Report for 2009
The office of the consumer advocate has published the
annual report on its 5th year of operation. 85% of the
files handled by the office related to P&C insurance and
15% related to life and health. Of the P&C files, 60%
related to auto insurance. The report notes that auto
rates went down by 1% and was the fifth year of
reductions. The report notes that “Affordability and
availability of auto insurance are no longer serious
issues in this Province and stability appears to have
set in for the benefit of the consumers over the past
few years. The average rate has gone from $1040 in 2005
to $751 in 2009.”
Issues noted:
Credit Scoring
The advocate has spoken out against credit scoring by
noting that “As a matter of social policy it should not
be allowed in the property and casualty industry
market.”
House insurance
Premiums are on the rise due to due to increased flood
claims and rebuilding costs. Under-insurance is another
issue resulting in adjustments in premium levels. There
appear to be some signs of instability in the market.
Minor injury cap for auto
The cap is under review and no decision has been
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CISRO Review of LLQP
CISRO is undertaking a review of the Life License
Qualification Program (LLQP) curriculum. CISRO advises
that it has been nine years since the LLQP was
developed. Three new modules are being added to the
measurable objectives, namely Tax Free Savings Accounts,
Registered Disability Savings Plans and Pension Income
Splitting. Industry is asked to make suggestions of
additional learning and testing topics. Feedback should
be sent to Pat Chamberlain at
pchamberlain@abcouncil.ab.ca
. The LLQP curriculum can be found on the
CCIR website. Input is requested by March 31, 2010.
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Quebec- Business Continuity Guideline Released
The Business Continuity guideline was issued by the
Autorité des marchés financiers (AMF) on April 1st,
2010, in accordance with An Act respecting insurance,
R.S.Q. c. A-32. It applies to all financial institutions
exercising their activities in Québec. The guideline
sets out the AMF’s expectations for financial
institutions’ legal requirement to follow sound and
prudent management practices. The AMF expects each
institution to develop strategies, policies and
procedures based on its nature, size, complexity and
risk profile, to ensure the adoption of the principles
underlying the guideline by April 1st, 2012.
Business continuity management consists of establishing
procedures to identify and deal with major operational
incidents likely to pose a threat to the financial
institution, such as natural disasters, power outages,
telecommunications failures, computer malfunctions,
piracy, terrorism, pandemics etc. Financial institutions
must develop a business continuity plan to ensure it is
optimally prepared to handle major operational
incidents. This is a written action plan that sets out
the procedures and resources required for the continuity
and resumption of the institution’s operations. The
guideline sets out principles such as senior management
responsibility and the need to identify critical
operations and possible threats. The document can be
found
here
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Quebec-
Reinsurance Guideline
A reinsurance guideline has been posted to the AMF
website. The guideline is effective April 2010. The
guideline deals with management of the risks of
reinsurance ceded, including retrocession, as well as
management of the risks of alternative risk transfer
mechanisms (ie an arrangement allowing for the transfer
or mitigation of insurance risks without necessarily
resorting to reinsurance. Such arrangements primarily
involve a transfer of risk to the capital markets, such
as the securitization of policy liabilities or the
issuance of disaster bonds.) The AMF expects each
insurer to develop strategies, policies and procedures
based on its nature, size, complexity and risk profile,
to ensure the adoption of the principles underlying this
guideline by April 1st, 2012.
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New Brunswick-Credit Score Legislation Passed-
Regulations Consultation announced
Bill 43- An Act to Amend the Insurance Act passed third
reading. The Bill puts in place regulation making
authority to set up prohibited underwriting and
insurance rating and classification practices for all
classes of insurance. The Minister is open to dialogue
on the regulations. The Superintendent has sent a
request for information to interested parties. Input is
requested by May 14.
New Brunswick has determined that the credit history,
credit rating, credit score or credit-based insurance
score of a person will be prohibited for underwriting
and rating purposes for private passenger automobile
insurance and for underwriting purposes for residential
property insurance but is prepared to review proposals
from industry on rating mechanisms that provide
consumers with true discounts.
The province has also determined that the following
factors will be prohibited for private passenger
automobile insurance and will likely be prohibited for
residential property insurance:
- Level of
income
- Gross or net
worth
- Indebtedness
of a person
- The fact
whether a person who would be an insured person
under the contract has a credit card;
Notwithstanding
the decision to include these items, the province is
seeking input on the appropriateness of applying these
factors to residential property insurance and seeking
input on the appropriateness of prohibiting credit
scores and these other factors for other lines of
property and casualty insurance.
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Atlantic Region- Maritime Insurance Harmonization
Project
Catherine Smith Horsman is no longer with the Maritime
Insurance Harmonization Project. Ms. Smith has accepted
a position with Service Nova Scotia.
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BC, Alberta & Saskatchewan - Trade Agreement -The New West
Partnership
In April, British Columbia, Saskatchewan and Alberta launched the
New West Partnership , an agreement intended to create Canada’s
largest interprovincial barrier-free trade and investment market to
the benefit of workers, businesses and investors in all three
provinces. The three provinces signed the New West Partnership at
the third joint British Columbia-Alberta-Saskatchewan Cabinet
meeting in Regina. Building on shared strengths, the New West
Partnership contains four components:
- A comprehensive economic
agreement, which will remove remaining barriers to trade,
investment and labour mobility.
- An international
co-operation agreement, that will see the three provinces
co-operate on trade and investment missions to international
markets, and share foreign market intelligence to advance joint
interests and increase business competitiveness.
- An innovation agreement,
which will enable provincial innovation efforts to be
co-ordinated to better attract investment and talent, helping
build critical mass of innovation activities in the West.
- A procurement agreement
that will enable the provinces to capitalize on their combined
buying power through the joint procurement of goods and
services.
The New West Partnership
Agreement can be viewed at
here
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