The much-anticipated introduction of electronic proof-of-insurance for auto insurance in Canada’s largest p&c segment has been met with great fanfare from insurers eager to enhance convenience and shift policy documents online.
Ontario has become the fourth province — following Nova Scotia, Alberta and Newfoundland and Labrador — to officially allow digital ‘pink cards,’ with regulatory safeguards designed to address data privacy concerns.
The Financial Services Regulatory Authority of Ontario (FSRA) stipulated in a guidance bulletin earlier this month that electronic insurance cards must have several security features — including ‘lock screen’ capability, which reduces the risk of other people gaining access to other applications and information stored on a policyholder’s device.
“This risk should clearly be communicated by insurers to policyholders,” FSRA said.
Ontario Finance Minister Rod Phillips said there will be a year-long phase-in period, during which insurers will have to provide a paper version along with the electronic option.
He said that will allow all relevant stakeholders to provide input on whether any further regulatory changes need to be made.
“Ontarians will have a choice of carrying electronic of pink slips — this is a proven innovation that has been adopted in three other provinces.
“We are not eliminating the (paper) ‘pink slip’ but are offering drivers another option,” Mr. Phillips said. “With the proliferation of mobile devices, apps and add-ons, it only makes sense that Ontarians can take advantage of the same options drivers in other provinces can for the convenience that a digital slip will offer.”
He stressed that the electronic ‘pink slips’ will have built-in safeguards so that they cannot be altered, nor can they access a driver’s location or driving information without the driver’s knowledge.
Mr. Phillips said the intention to allow electronic ‘pink slips’ was laid out in the spring budget but consultations with the insurance industry, consumer groups, law enforcement and privacy experts delayed the implementation date.
The government said consultations with the public indicated a majority of Ontarians want to have access to electronic proof of auto insurance.
“Earlier this year we asked Ontarians about ways to make auto insurance more accessible, affordable and convenient,” Mr. Phillips said. “Fifty-one thousand people provided us with their ideas and 68% said they believe insurance companies need to provide them with more options for online and digital tools.”
Despite the safeguards included with the new regulations, privacy experts warned policyholders to think twice before handing over their phones to authorities.
Ann Cavoukian, executive director of the Toronto-based Global Privacy and Security by Design Centre, noted that today’s cellphones contain a great amount of personal information that policyholders may not want to share with others.
And Brenda McPhail, director of the privacy, technology and surveillance project at the Canadian Civil Liberties Association, told CBC News she believes the province may be thinking only of convenience and ignoring other implications.
“We have to be careful that this isn’t yet another occasion where we’re being asked to hand over our privacy for the sake of supposed convenience,” she said.
The Insurance Bureau of Canada and auto insurers themselves welcomed Ontario’s announcement with open arms. “Being able to provide digital documents to today’s tech-savvy consumer is a baseline expectation of service we are thrilled to now be able to provide,” said Kim Donaldson, IBC’s Ontario VP.
She said the bureau expects more provinces to follow suit in the near future.
Intact Financial subsidiaries Intact Insurance and Belairdirect have released enhanced digital proof of auto insurance that policyholders can access on the insurers’ respective mobile applications.
“We’re committed to meeting the changing needs of customers in an increasingly digital world,” said Danny DaCosta, Ontario senior VP at Intact Financial. “We know their time is valuable and our digital pink cards offer a secure and convenient way to provide insurance information in an easy-to-access, readily available format, when and where they need it.”
Aviva Canada also applauded the Ontario government for approving electronic proof of auto insurance.
“This is an example of stakeholders collaborating effectively to meet the evolving needs of customers on choice and convenience,” said Phil Gibson, managing director of personal insurance at Aviva Canada.
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