The property and casualty insurance industry
Insurance is part of the financial services sector, and as such,
is regulated by the Department of Finance federally and the Ministry
of Finance provincially. In broad terms, insurance companies come
under federal jurisdiction, and sales intermediaries come under
provincial jurisdiction. At both government levels, life and health
insurance and property and casualty insurance are handled separately.
Federal:
Insurance companies come under the jurisdiction of the Office
of the Superintendent of Financial Institutions (OSFI).
One of its mandates is to ensure that insurance companies remain
solvent, i.e., that they have enough money to pay claims. Earnings
reports and other financial data are filed with the OSFI and listed
on its website.
Insurance companies obtain revenue from two main sources: from
the premiums they charge for insurance policies, and from investments
they make while holding money to pay future claims. When income
levels are good (due to premium pricing, investment returns or
lower-than anticipated claims), insurance companies tend to lower
their rates to attract more business. When income levels are low,
they have no choice but to raise rates to meet solvency requirements.
Insurance
industry overview
The federal government provides consumer information and protection
through these two offices:
Financial Consumer Agency
of Canada
General Insurance OmbudService
The trade association for insurance companies is the Insurance Bureau of Canada.
Provincial:
The Financial Institutions
Commission (FICOM) administers the
B.C. statutes pertaining to insurance and other financial services.
It authorizes insurance companies to do business in B.C. and handles
market-conduct issues.
FICOM does not regulate the Insurance
Corporation of B.C.,
which is itself a Crown corporation. ICBC has a legislated monopoly
for universal compulsory auto insurance in B.C. under the regulatory
supervision of the BC Utilities
Commission. ICBC and private
insurance companies offer optional auto insurance.
The Insurance
Council of B.C. is the licensing and disciplinary
body for insurance brokerages, as well as for individuals who work
as salespersons, brokers, agents and adjusters. Visit the Council’s
website to find out if a certain individual or company is licensed
to operate and whether there are any restrictions on that licence.
The Insurance Brokers Association of B.C. (IBABC) is the trade
association of property and casualty insurance brokerages in B.C.
It is the main provider of pre-licensing and mandatory continuing
education for brokers. IBABC is the ‘voice’ of the
insurance brokerage industry in B.C. and represents the interests
of its members and consumers to government and to industry stakeholders.
Membership is voluntary, and about 85% of the insurance brokerages
in B.C. are members of the IBABC.
IBABC is a member of the Insurance Brokers Association of Canada. IBAC is the national trade organization that brings together and represents the 11 regional and provincial associations of property and casualty insurance brokers in Canada. These associations represent approximately 30,000 insurance brokers in virtually every community across the country.
The Insurance Dispute Resolution Services of BC is a not-for-profit ombudservice that provides dispute resolution services and advice to the insuring public and the insurance industry. IDRSBC offers a range of options for resolving insurance disputes that are generally lower-cost and faster than going through the courts. |
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