The Canadian Council of Insurance Regulators (CCIR) has released its 2023 Annual Statement on Market Conduct (ASMC) Public Report, offering insights into the life and health (L&H) and property and casualty (P&C) insurance sectors in Canada.
This report, based on nationwide insurer data, evaluates adherence to Fair Treatment of Customers (FTC) principles and highlights emerging trends in the industry.
The report shows that while most insurers claim to prioritize FTC principles, discrepancies persist between stated practices and observed implementation. Regulators identified instances where insurers lacked comprehensive FTC-specific policies despite their claims.
The data has revealed a decline in claims ratios across most insurance categories, indicating fewer claims relative to premiums. However, large property insurers reported significant delays, with more than 21% of claims taking over 180 days to close—more than double the industry average of 9.7%.
Complaints across both sectors increased, particularly concerning claims and settlements. The L&H sector experienced a 41% rise in product-related complaints, while the P&C sector noted a 30% jump in claims-related grievances.
Distribution contracts in the independent channel increased, especially among large insurers. The L&H sector recorded a notable rise in audits focused on FTC, whereas the P&C sector showed a decline in such efforts. The number of policies in force remained steady in most categories, although accident and sickness policies grew significantly by 17.25%.
Governance remains a focal point in the report, with the CCIR urging insurers to embed FTC principles in their business models and improve their oversight of intermediary practices. Customer satisfaction surveys are highlighted as an effective tool to measure FTC outcomes, but their adoption remained relatively unchanged from previous years.
Claims handling times were found to vary between sectors. In the L&H sector, average processing times ranged from 7 days for prescription drug claims to over 270 days for some group insurance claims.
In the P&C sector, lengthy delays were reported for travel health and property claims. Reasons for claims denials highlight policy exclusions, incomplete documentation, and misrepresentation being the primary factors.
The CCIR has recommended that insurers address delays in complaint handling and enhance FTC-focused practices. Insurers are encouraged to evaluate their operations in light of the report’s findings and to implement strategies that improve customer experiences.
The CCIR noted it will continue to monitor trends, conduct supervisory reviews, and ensure the industry aligns with regulatory expectations to strengthen consumer confidence in the insurance market.
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