By CSIO
The Canadian Council of Insurance Regulators (CCIR) has announced that it will implement electronic proof of auto insurance, or eSlips, in the first half of 2017. Once implemented, drivers will no longer be required to carry a paper copy of their proof of insurance. Instead, they will have the option to use their mobile device to display a digital version.
Situation update
Quebec is already halfway there – its regulator (Autorité des marchés financiers) permits insurers to send an insurance certificate that contains prescribed content to consumers via email, whereas printing and mailing a paper copy is still required in other provinces such as Ontario and Alberta. With CCIR’s announcement, however, regulators across the country are poised to fully implement eSlips within the next few months.
Industry and consumer demand for eSlips has grown in recent years — to the tune of 31% of Canadians who are interested in using their mobile devices to store and display digital ID or proof of auto insurance (Forrester Research). In fact, some brokers have gone so far as to design mobile apps that allow customers to do just that, whether regulators approve or not.
“The number one, most-used feature of our app is digital pink slips,” says Sherif Gemayel, president of Sharp Insurance in Calgary. “So the clients will actually use their app to show proof of auto insurance. As it’s not legal yet in Canada, we have a disclaimer on the app that says clients still have to carry their paper pink card in their car, but they’ve never had an issue with it.”
Many Sharp customers report that police have readily accepted eSlips displayed on their mobile phone during traffic stops, suggesting that Canadian consumers and police officers alike are open to an update to existing regulations.
Benefits of eSlips
eSlips will benefit the broker channel in many ways, including:
- Meeting the expectations of consumers for digital delivery of insurance documents
- Reduced operational costs for printing and mailing proof of auto insurance slips
- Fully realize the benefits of CSIO’s eDelivery solution, sending electronic copies of policy documents to insureds without the requirement to mail a paper copy as well
CCIR’s announcement caps off a great deal of effort on eSlips in 2016, including CSIO’s February eSlips Advisory Report, prepared by national law firm Fasken Martineau LLP to educate the broker channel on the legal landscape surrounding eSlips and to advocate for regulatory acceptance. CCIR issued its own Issues Paper and conducted a public consultation shortly afterwards in May.
CCIR identified issues for further study including:
- Consistency of regulations between jurisdictions
- Liability for damage and protection of privacy when mobile devices are handled by law enforcement (g., damage to a customer’s phone while being handled by an officer)
- Liability for telecommunications carriers where the electronic device is unable to download and display the eSlip
- Safeguards against fraud
The American example
When envisioning just what eSlips could look like in Canada, it is worth taking some time to study our neighbours to the south.
Since 2011, the number of states accepting eSlips in one form or another has risen from 0 to 43, which accounts for 86% of all jurisdictions. Unlike the CCIR’s unified approach, laws can vary from state to state. While this variation may lead to confusion for drivers crossing state lines, it provides many opportunities to see how various approaches to regulation work in practice.
For instance, North Carolina allows insurers to send an insurance card electronically, but still requires drivers to carry a paper copy for traffic stops. To address privacy concerns, New Jersey legislation states that the use of an electronic device to display proof of insurance “does not constitute consent for a police officer or judge to access any other contents on the device.”
CSIO is in communication with CCIR on this initiative and looks forward to working with them to ensure the successful implementation of eSlips in 2017.
