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Compensation from the government in the face of the industry : a cohabitation, will need to develop


Andrea Lubeck

13 July 2017 07:00

Jean-François Gagnon

Discussions between the insurance Bureau of Canada (IBC), the insurers and the ministry of public Security have led to an agreement to allow flood victims certain to be compensated by the assistance program of the government.

Thus, the eligible amounts and the list of goods covered by the program were expanded specifically for people affected by the floods that occurred between 5 April and 16 may. The program will also cover the amounts that exceed those of the police, up to the maximum amounts provided for in the program.

Pierre Babinsky, director of communications and public affairs for the IBC, spoke on the issue with, a sister publication of the Journal of the insurance. He stressed that the discussions with the government continues, » to find a formula for the long-term coexistence of private insurance and government assistance «.

Jean-François Gagnon, associate attorney at Langlois Lawyers, explains that this situation was » special «. Therefore, it was important that the programs offered by the insurers and the government are complementary, not in opposition.

«It was necessary to settle the question of the cohabitation, first, to ensure that the insurance vienna to enhance the compensation from the government, and not the contrary. We must not lose sight of the fact that the government program comes as a last resort. «

Protection against flooding is a thing new to the country. Until recently, Canada was the only country in the G8 that does not have a program by the insurers to cover the flooding for the residences, reminds Me Gagnon.

«The insurers have started to mobilize after the events of Calgary in 2013. As there was no offer of insurance at maturity, the space compensation was occupied by the government. At that time, the industry and the government have desired that the main response comes now of insurers «, he said.

He recalled that, in insurance law, it sets out an offer to maturity when all insurers are protecting almost all their customers against a loss. At the date of the flood, the offer was not mature.

In the rest of Canada, an offer of insurance is filed promptly, but is deployed more slowly in Quebec. Some insurers in Quebec offer the rider against the rising flood waters from the months of march 2017. Intact Insurance, Desjardins General Insurance group, Aviva, belairdirect, Warranty, and Sonnet are part of the insurers providing protection to their insureds.

In the long term, the coexistence of the program, disaster financial assistance and the offer of private health insurance is it possible ? Yes, says ms. Gagnon.

«The interest of the government is to promote the emergence of the insurance market mature. When we look at the evolution, we can anticipate that the government will be reduced. At maturity, there would be an offer strong insurance by the insurers, and the presence of the government in case of need, » he explains.

He also stressed that, from the moment that the insurance becomes mature, the government assistance will be limited to areas where private insurance is not available. It may also be paid to exceptions that are not included in the insurance policies.

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