Five of Canada’s top 10 insurers will now accept business quoted using standardized consent language that shifts responsibility onto the insurer where credit scoring is used.
“Many brokers do not know that they are exposing themselves to risk when they collect clients' credit information without consent,” says Chris Floyd, president of the Insurance Brokers Association of Ontario. “Under the previous language, brokers were responsible for the collection and use of credit information, even though they were not the ones using it. Having this new language in place will shift the onus back to the insurer.”
This language is respective to only those quotes where credit is used in the quoting process to determine rate.
Over the past year the IBAO has been working with insurers to develop the broker consent language and since gaining consensus has sent this wording to their online quote providers for adoption.
Five of the largest insurers have agreed to use this language and each of the BMS vendors have been sent the language to embed into their system.
“This wording will enable our Brokers to obtain consent on behalf of the insurer in respect to a quotation that includes personal credit information including credit score, as permitted by law,” says IBAO CEO Randy Carroll. “This is a big win for the broker network.”
IBAO stresses that it has not changed its position as it relates to credit scores being used to rate or underwrite insurance, however the change in wording merely shifts the onus of responsibility for the collection and use of the information back to the insurer.
