New Brunswick insurance brokers have been in a “wait-and-see” pattern for almost a year, as their concerns about licensing interpretations have been all but hijacked by backroom discussions about potential changes in the province’s justice department, which regulates the insurance industry.
“We’re in a wait-and-see mode now to see what’s going to change in the government, if anything, with the government departments,” confirmed Geordie Lamb, president of the Insurance Brokers Association of New Brunswick, when asked for an update on the brokers’ licensing concerns.
These concerns were voiced almost six months ago by then-president Terry Gaudet, who noted at the time that brokers did not agree with the regulator’s interpretations about some licensing provisions.
“At the time, the regulator didn’t agree with us, so we started lobbying for [the association’s interpretation of the rules], and then the government said: ‘We are looking at this new model,’” Lamb said. “It’s a whole new model for the justice department. I think they call it a financial services model.”
Details of the model are not public, and the justice department did not shed any light on the model when asked about it. Lamb said the government’s internal discussions about the model have not yet reached the point of public consultation yet.
“We’ve been following up and saying ‘What’s going on with the services model? Have you got any news for us?’” Lamb said. “The answer is always: ‘We’re working through it right now, and we’ll get back to you when we have something.’”
Internal discussion about the financial services model appears to have extended beyond the government’s estimated timeframe of six to 12 months. In the meantime, the province’s brokers have had to carry on working with a contentious interpretation of the province’s licensing regulations.
“Everything is status quo until we hear different,” said Lamb. “Whether they change that in the near future, before the services model potentially comes in, we’re at the hands of government, waiting to see what they’re going to do.”
Basically, the association and the regulator do not share the same view of what a Class I licensee can do. The regulator told brokers that a Class I licensed broker can basically answer phone calls, take in payments and direct people to a Class II licensed broker to handle sales in personal lines. Brokers, on the other hand, believe a Class I licensed broker is entitled to sell personal lines home and auto insurance under the supervision of a broker with a higher class of licence.
Also under dispute is the regulator’s view that “over-the-shoulder,” physical supervision is required for Class I licensed.
“Their interpretation of it is ‘over-the-shoulder’ supervision, while we are saying that in today’s society, with the technology we have – we have BlackBerries, Playbooks, we have computers for phones, Facebook, whatever you want to use – you can get a hold of your boss or your supervisor in a matter of seconds should a problem arise," Lamb said.
