The Ontario Broker - Volume 21, Issue 6 - 8

INDUSTRY & MARKETS
ADVOCACY IN ACTION | CREDIT UNIONS
With IBAO CEO Colin Simpson
" We were clear with the government that on the face of it, we'd be
supportive of this change, provided that existing controls to prevent
cross-selling and tied-selling to protect consumer interests remained
in place. "
Communications outlined a framework of how the regulations
and subsequent business practices could be shaped to safeguard
consumers.
" One thing we strive to do is provide our key stakeholders with
solutions to problems rather than just voicing our concerns. They
specifically thanked us for doing that. "
T
8
he question of whether credit unions should be allowed
to sell general P&C insurance products has cropped
up regularly in the past decade. A few years ago, the
Ontario Government granted credit unions the ability to
purchase insurance brokerages-they're permitted to
buy up to 30% of a brokerage under certain conditions
and a controlling stake with the expressed permission of FSRA's
CEO. This acquisition ability effectively allowed them access to P&C
distribution, while restricting sales to a separate entity and location.
Late last year the IBAO was alerted to credit unions' legislative push
for the ability to sell P&C insurance from the same premises. In the
spring of 2021, the Minister of Finance's office was transitioning
through a period of change, and we wanted to ensure that the new
team was aware of the potential consumer conflicts and concerns with
such a move. Although the IBAO isn't directly opposed to this change
in principle, in July, we submitted a letter to the Ministry of Finance
outlining concerns around how this practice could potentially unfold.
" We worked closely with our government relations advisors and the
Ministry to place strategic messaging in the hands of those that were
influential on shaping the outcome of this issue, " said IBAO CEO
Colin Simpson. " At the request of the MOF team, we set up a meeting
with one of our larger members who had specific experience on the
evolution of credit unions out west to assist in their understanding and
thought process. "
Following the meeting, we submitted subsequent communications
to the MOF expanding and clarifying our discussion issues, including
messaging from the meeting and information gratefully provided by
the Insurance Brokers Association of British Columbia.
At the time of writing, two of the three new regulations on credit
unions have been released for public consultation. We have until
December 24th to respond to proposed regulations and the highlevel
parameters around them. We've proactively connected with
the Ministry following the release to ensure we continue our candid
discussion.
" We're currently reviewing regulations-it appears our messaging was
effective. But the devil is in the details and we'll keep communication
channels open as the insurance regulation itself is drafted.
" We'll continue to submit our comments based on available
information and ongoing review. Once the MOF team collects public
comments towards the end of December, they'll finalize regulation
changes in the new year. And we'll certainly notify our members when
that happens. "
" One thing we strive
to do is provide our
key stakeholders with
solutions to problems
rather than just
voicing our concerns. "
THE ONTARIO BROKER
The Ontario Broker - Volume 21, Issue 6

Table of Contents for the Digital Edition of The Ontario Broker - Volume 21, Issue 6
