IBC: Ontario Insurance Act is blocking insurers from conducting digital business

Published: February 14, 2018

Updated: July 24, 2018

Author: Luke Jones

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Ontario’s Insurance Act is blocking the province’s insurance companies from using digital and mobile platforms to interact with customers, the Insurance Bureau of Canada (IBC) said Monday.

The IBC has previously been critical of Ontario’s lack of movement on introducing electronic proof of auto insurance. Speaking this week, Steve Kee, IBC director of media and digital communications noted 15 sections of the Ontario Insurance Act as prohibitive for insurance companies trying to use digital methods to work with customers.

“The Act and regulations require communications using mail, registered mail, delivery or personal delivery – 19th century communications with 21st century customers,” he said.

Specifically, Kee pointed to the following sections of the Act and regulations:

  • Section 134(3) – Where note or cheque for premium not honoured;
  • S. 148, Statutory Conditions 6(1) – Termination;
  • S. 148, Statutory Conditions 15 – Notice;
  • Reg. 777/93: Statutory Conditions – Automobile Insurance: S. 11(1);
  • Reg. 777/93, S. 11(1.1) (a) (b);
  • Reg. 777/93, S. 11(1.2) (a) (b);
  • Reg. 777/93, S. 11(1.3)(b);
  • Reg. 777/93, S. 11(1.7);
  • Reg. 777/93, S. 11(5);
  • Reg. 777/93, S. 12;
  • Reg. 676: Uninsured Automobile Coverage, S. 5(1);
  • S. 232(2) – Policy issued where no signed application;
  • S. 232(3) – Insured entitled to copy;
  • S. 269(1) – Particulars of insurance; and
  • S. 269(2) – Demand for particulars.

Kee says the above sections are outdates, featuring antiquated communications methods.

For example, Section 134(3) of the Act says: “Where a cheque, bill of exchange or promissory note is given, whether originally or by way of renewal, for the whole or part of any premium and the cheque, bill of exchange or promissory note is not honoured according to its tenor, the insurer may terminate the contract forthwith by giving written notice by registered mail.”

Part of Section 12 of Reg. 777/93 says that “written notice may be given to the insured named in this contract by letter personally delivered to the insured or by registered mail addressed to the insured at the insured’s latest post office address as notified to the insurer.”