CANADIAN motorists and the insurance industry are both eager to use electronic proof of auto coverage but apart from Nova Scotia, provincial regulators appear to be in no hurry to introduce it.
The Canadian Council of Insurance Regulators has made it clear that electronic proof of auto insurance should be made available but left it up to each province to decide on implementation.
Catherine Smola, president and ceo of the Centre for Study of Insurance Operations, said the introduction of digital ‘pink slips’ (as the documents are often called) in Nova Scotia appears to be going smoothly.
“The deputy superintendent of insurance for Nova Scotia has said that since implementation no concerns or negative feedback have been raised by consumers or law enforcement,” she said. “Approving (electronic proof of auto insurance) was a fairly easy decision to make in order to demonstrate responsiveness to today’s consumers.”
Malon Edwards, senior communications officer at the Financial Services Commission of Ontario, told Thompson’s that the approval of electronic proof of auto insurance is not on that regulator’s radar.
“At this time, no timetable has been set for the approval of electronic proof of insurance in Ontario,” he said.
Ms. Smola said it is disappointing that provincial regulators have been slow to approve the technology but brokers and carriers can still send eSlips — the CSIO’s electronic pink slip application — as long as they continue to provide the paper copy as well.
“For today’s customers, having access to a digital copy of their proof of insurance is incredibly important, even if they are still required to have a paper copy.”
She noted that a recent Insurance Bureau of Canada survey found that 74% of consumers wanted electronic proof of auto insurance.
Some motorists have been using digital proof without it even being approved.
“Even if it’s just taking a picture of their pink card with their phone, consumers have reported that police have even accepted the digital copy at traffic stops,” Ms. Smola said.
She said Canadian regulators are lagging behind comparable jurisdictions in officially approving the practice.
Electronic proof of auto insurance was approved in Britain in 2010. And in the U.S., 49 states have approved it since 2011 — including all 11 states that share a border with Canada.
“Regulators exist to protect the public interest, so they take a cautious approach to new technology and business models…as with Uber and Airbnb, regulation can take a while to catch up to market reality and consumer demand,” Ms. Smola said.
She noted FSCO approved the use of electronic proof of auto insurance in 2016 but only for Uber drivers.
In February, CSIO launched a new broker solution called ‘My Proof of Insurance, which can facilitate an electronic delivery of proof of auto insurance to consumers.
Ms. Smola said hundreds of brokers have signed up for the solution since its launch and 75% of brokerages in Nova Scotia are using it.
She said providing consumers with the option of electronic proof of auto insurance levels the playing field between the insurance industry and other industries.
“The same insurance customers who can’t receive a digital copy of their proof of insurance can walk into many national retail chains today and request an email copy of their receipt in place of a printed one.
“So the ability to create a digital customer experience isn’t just a value-add for our industry — it’s essential,” Ms. Smola said.
And, unfortunately, consumers don’t realize that the lack of a digital option is a regulatory limitation as opposed to a technological one.
“They are surprised to discover they still require the paper copy and think it’s a technological barrier on the part of their insurance provider,” Ms. Smola said.
“The onus is on regulators to follow Nova Scotia’s lead and the CCIR’s recommendation to adopt a modern approach to auto insurance cards, meeting the expectations of Canadian consumers and ensuring we keep pace with other jurisdictions.”
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