P&C Insurance (including Auto) Consultation Summary Report

• CADRI
• Co-operators
• Desjardins
• Intact
• AIAC

Stakeholders expressed broad support for the P&C Insurance (Auto) SOP, including:

• FSRA’s commitment to principles-based regulation and focus on protecting consumers;
• Protecting vulnerable consumers in the auto insurance sector;
• Informed consumer decision-making and increased transparency;
• Reviewing territory rating; 
• Improving the Health Care for Auto insurance system with a recommendation to increase data integrity; and

Support for increased choice for auto insurance. Some stakeholders were concerned about volume of planned consultations and expressed interest in a detailed roadmap of planned consultations, milestones and key deliverables.

FSRA thanks stakeholders for supporting the 2023-2024 SOP and Budget. FSRA will consider recommendations on how to improve as part of next year’s Annual Business Planning cycle.

FSRA will keep stakeholders informed on consultation activities as work to reform the regulation of rates and underwriting advances.

• CADRI
• Co-operators
• Desjardins
• Intact
• OMIA

Stakeholders supported defining fairness.

Some stakeholders noted that achieving a practical and impactful definition of fairness will be challenging and depend on consultation and ongoing dialogue with the sector. Stakeholders also expressed concerns about market consequences of defining fairness and that moving too quickly may come at the cost of clarity.

A stakeholder sought clarification from FSRA about fairness as it relates to vulnerable consumers in the context of auto insurance. Some stakeholders expressed interest in FSRA reviewing prohibited factors to ensure that they are in the public interest. Some stakeholders recommend rescinding the territory rating bulletin.

FSRA appreciates your support for FSRA’s commitment to strengthening consumer protection and will continue to explore opportunities to promote fairness in auto insurance.

The development of recommendations on fairness will be based on robust evidence collection and meaningful stakeholder consultation.

FSRA looks forward to receiving submissions from all stakeholders with respect to FSRA’s strategy to reform the regulation of rates and underwriting.

FSRA plans to review the effectiveness of the current list of prohibited elements as part of its work on reforming the regulation of rates and underwriting.

FSRA is also reviewing territory rating and will integrate its findings into recommendations on reforming the regulation of rates and underwriting.

• Co-operators
• Desjardins
• OMIA
• AIAC
• OTLA

Stakeholders expressed concern about the costs and benefits for consumers of an industry-wide fraud reporting service.

A stakeholder suggested reduction in fraud and abuse needs to include enforcement and appropriate deterrents.
 
A stakeholder was unclear how fraud is being defined and how much fraud exists in the system. Up-to-date data on fraud should be made public.

FSRA appreciates stakeholder interest in ongoing work in support of the development of a fraud and abuse strategy.

The first step to addressing and quantifying fraud is obtaining accurate data and then using that data to advance evidence-based tools. 

FSRA is currently developing a Fraud Reporting Service tool that would hold insurers accountable for managing, tracking and reporting fraud. The Fraud Reporting Service will ensure that a common definition of fraud and consistent data will be used when reporting begins.

The Fraud Reporting Service will be enabled by a FSRA Rule, which will be developed in accordance with a robust and transparent public consultation process before coming into force.

FSRA is committed to a consistent approach and transparency in enforcement 
 

• OTLA
• OMIA
• FAIR
• CAP
• CADRI

One stakeholder suggested that consumers be provided with data on insurer profits and profit increases. A clear as well as detailed explanation should be required to justify the individual increases in rate from year to year for any consumer.

Some stakeholders expressed interest in consumer satisfaction benchmarking. Some also expressed concerns about associated costs and reporting structures, which may not provide greater insight to the sector.

One stakeholder suggested that FSRA’s work on empowering consumers and supporting informed decision-making should include publishing consumer complaint outcomes and mandatory disclosure to consumers.

FSRA thanks you for your interest in supporting informed consumer decision-making.

FSRA will consider stakeholder recommendations as work advances and looks forward to engaging the sector on tactics to increase transparency and support informed decision-making. 
 

• OMIA
• Co-operators
• Intact

Some stakeholders had concerns about optional DCPD adding administrative burden without tangible benefits for a large number of consumers.

Stakeholders requested that insurers have all the statutory, regulatory, and administrative materials required to meet the effective date for DCPD optionality.

The government has made it mandatory for insurers to permit consumers to opt out of DCPD coverage effective January 1, 2024. FSRA will release the necessary endorsements and forms in December 2022, which will give insurers time to take the necessary implementation steps in advance of the effective date.

• AIAC
• Co-operators

Some stakeholders expressed concerns about longstanding issues in the HCAI system, including errors and poor data quality, issues with transparency and access to system data (both user and consumer focused)

FSRA is working with health service providers and auto insurers to improve health care for better consumer outcomes.

Stakeholder feedback recently identified four areas of focus: (a) data integrity review, (b) promoting communication between health providers and insurers, (c) creation of an attendant care invoice, (d) measure of health outcomes. FSRA is prioritizing and developing workplans to advance this work.
 

• Co-operators
• CAFII
• Intact
• CADRI
• OMIA

Stakeholders expressed broad support for FSRA's commitment to positive consumer outcomes.A stakeholder expressed interest in FSRA’s deliverable on evaluating external dispute resolution frameworks, including whether it involves improving the legal or tribunal systems for resolving claims.

FSRA appreciates stakeholder support on strengthening the consumer focus.

FSRA is committed to strengthening its consumer research function and will consider partnership with stakeholders in this area.

FSRA’s deliverable related to external dispute resolution relates to complaints. Improvements to the legal or tribunal system are not in scope for this deliverable.
 

• Co-operators
• Intact
• CAFII
• CADRI

Stakeholders expressed strong support for FSRA’s ongoing efforts on innovation.

Some stakeholders expressed support for regulatory sandboxes that provide a safe environment to test innovative products. One stakeholder suggested that FSRA should focus on innovation on long held processes and restrictive rules that inhibit client focused innovation.
Some stakeholders expressed support for increasing collaboration with other regulators.

FSRA welcomes innovation initiatives by market participants and reiterates its commitment to facilitating innovation across FSRA-regulated financial services sectors.

FSRA aims to address barriers to entry and innovation through our Innovation Framework generally and our Test and Learn Environment (TLE) tools specifically.

By developing stronger ties with other regulators and stakeholders, FSRA aims to address mutual challenges and build a stronger and more innovative Ontario financial services market. 
 

• CAFII
• OTLA

Stakeholders expressed broad support for FSRA’s Talent Management Framework to recruit new talent. FSRA will be facing similar challenges as the industry with an increase in retirements and a shrinking talent pool.

FSRA appreciates stakeholder support on enhancing FSRA’s Talent Management Framework and Strategy.

• OMIA

The regulator’s need for increased data analytics requires a disciplined cost benefit process. It may result in additional cost to insurers that may be passed on to the policy holder. 

FSRA will consider the costs and benefits of data and analytics transformation as work advances.