By: Luke Jones, Published on March 29, 2017 11:58 AM, Last Update on March 29, 2017 10:13 AM
The disagreement between the Insurance Brokers Association of Ontario and Aviva Canada has not been resolved, the IBAO’s chief executive said on Tuesday. However, Colin Simpson says talks between the two are ongoing.
Two months ago, the IBAO suspended Aviva Canada’s participation in its sponsorship program after the company announced a controversial new product. Since then discussions have taken place to find a potential resolution.
“We continue to talk to Aviva,” IBAO CEO Colin Simpson said.
“The challenge we have with Aviva is that they have a particular brand strategy that directly competes with you and your offices,” Simpson said during the annual general meeting of the Insurance Brokers of Toronto Region, held Tuesday at Le Parc banquet and conference centre in Markham. “It does so by branding a product with the Aviva brand but is sold at a different value proposition than what you can sell in your office.”
The disagreement started when Aviva Canada launched new team branded home and auto insurance products on Jan. 18. The company is targeting the insurance policies at fans of the Toronto Raptors and Maple Leafs sports franchises. Aviva says those products will be offered at competitive prices to entice fans. The coverage is underwritten by Aviva subsidiary S&Y Insurance Company.
The IBAO said the new solutions were against its policies and did not promote the broker network with Ontario insurance.
“I completely understand Aviva’s position,” Simpson said. “They have a strategy and they want to do it.”
On Jan. 23, IBAO announced that Aviva would “no longer be invited to participate in the IBAO’s Sponsorship Program for the foreseeable future.”
“We will see how this evolves,” Simpson said Tuesday at the IBTR AGM.
“We keep getting asked, ‘Why don’t you pick on Belair?’ or ‘Why don’t you pick on Sonnet?'” Simpson said, alluding to the direct writers owned by Intact and Economical respectively. “To us there is a clear distinction between the value proposition of a direct writer and what Aviva is doing.”
“We have had multiple discussions with Aviva and we continue to have multiple discussion with Aviva,” Simpson said Tuesday. “They see the use of that brand as being to the benefit of the brokerage – ‘whether it’s competing against you or not, any exposure of their brand is good for you.’ We completely disagree. We have examples, we have anecdotes, we’ve got real live rating issues that we have presented them that specifically states that what they are doing is damaging our business. We have customers going into some of our members’ offices that are saying ‘we have worked with you guys for 30 years and you have been ripping me off.’ Consumers don’t understand the nuances of the same branded product. Aviva disagreed with us.”