7 February, 2018 10:54
Louis Morisset | Photo : Denis Méthot
To force a broker to offer four proposals from insurers to a client when buying a individual insurance as proposed by the bill 150 would not be easy, according to theAuthority of the financial markets.
This is what the representatives of the regulator stated in a parliamentary committee on Tuesday. «It would be a challenge in some cases,» said its CEO Louis Morisset, when he was interviewed by the member of the Coalition Avenir Québec, François Bonnardel.
He said fear for the future of brokers. «What the legislature should decide today and not give you any latitude, by regulation, define two, three or four proposals, he requested the Authority. Four, reassure me, but I am not reassured at all for the sustainability of the brokers. «
Minimum number : a «very good idea,» says Louis Morisset
«Our perspective is that in the current state of the market, to establish a minimum number seems to us to be a very good idea. In the niche market of insurance of individuals, four submissions can be a challenge, » agreed the CEO of the Authority.
«In insurance companies, it comes in any way restrict the ability of a broker. If we put this in a law and in the facts, it doesn’t work, this will be a problem. What is being suggested, it is to ensure that in the law, we will strengthen this foundation so that insurers respect the independence of brokers. «
Louis Morisset said, as well as search for a solution to a real problem. «People claim to be brokers when they are not. I think that a legislative solution that comes to establish a number of submissions is desirable, but it is necessary that it works. For it to work, it is necessary to reinforce this measure with more impacts with respect to insurers, to raise awareness and to enable us to act in respect of the influence they may exert on brokers «.
What is contained in the bill 150
The bill 150 amends the Act respecting the distribution of financial products and services. It is noted that an insurance broker must provide the client with the products of at least four insurers that are not part of the same financial group, by proposal of insurance.
In the case where the broker would not be able to present to its customers the products of at least four insurers, article 244 stipulates that it should retain the information and allowing him to prove that he has made every effort to comply with the required provisions. It could then continue to offer these insurance products.
Unanimous rejection on the part of industry groups
This requirement included in the bill was rejected unanimously by all the groups from the industry who made submissions to a parliamentary committee. Some consider it inapplicable and inappropriate, considering it as unrealistic and burdensome in today’s market where consumers are seeking a fast service.
A group has raised a minimum of two proposals, but the president of The Capital financial Group, Jean St-Gelais, pleaded in order to avoid that the number is specified in the act. He had said at that time that he preferred to defer to the Authority.