Dear RCCAQ members:
As the news media keep reminding us, the issue of online insurance sales leaves no one in the industry indifferent!
A variety of statistics and surveys keep vying for our attention. According to CADD (Quebec association of direct insurers), 44% of consumers describe themselves as feeling "comfortable purchasing auto insurance online from start to finish, without the involvement of an insurance agent" (Journal de l’assurance, December 9, 2016). In contrast, CHAD notes that "over 50% of consumers are not familiar with all their contract exclusions and inclusions and do not fully understand all the details" (Journal de l’assurance, December 1, 2016).
No one, least of all the RCCAQ, questions the fact that consumers' purchasing patterns have changed in recent years; the Internet is now a factor that must be taken into consideration. But the real issue at stake is determining what role the Internet should play within a new legislative framework for online insurance sales, as set out in Bill 188.
The RCCAQ's position is clear in this regard. Insurance policies are not like other consumer products; the involvement of a certified representative should be mandatory for all online insurance-related transactions. Claiming that insurance products are straightforward is tantamount to shifting the responsibility for such transactions onto consumers; it also negates the importance of brokers' advisory role and the value added they bring.
Insurance can be sold online in other jurisdictions, such as France. However, the results are instructive. In 2012, only 15% of French consumers bought insurance products online*. Despite being allowed to do so, they understood they might purchase a product that might not provide the coverage they needed. The risks and the potentially disastrous consequences were clear for all to see.
So what will happen when consumers who feel "comfortable" purchasing insurance online go to file a claim? If they are unaware of the complexity of the product(s) they have bought, how will they acquit themselves with their insurer when the time comes?
That's where brokers' advisory role comes in. We see the value of good advice every day, that is, whenever our clients take out a new policy or require assistance reporting or settling a claim. That's also where the RCCAQ comes in. Over the past few months, while Bill 188 was being revised and up until its introduction in Quebec's National Assembly, we lobbied the government relentlessly. We will keep putting pressure on the decision makers as we continue to defend your advisory role. It's in brokers' interest—and it's in consumers' interest as well.
Kathleen Ann Rake
RCCAQ Chair
*Statistic quoted in the study published by Option Consommateurs on online insurance sales, November 2016.
