June 22, 2017 11:30
Photo : Freepik
RSA Canada application to the department of Finance of Québec, which is planning to abolish the rule limiting the participation of insurers in the insurance brokerage firms in damage, maintain this rule in order to avoid that the brokers will find themselves in a situation of conflict of interest. For the insurer, this rule helps to maintain a strong competition in the province, which is the key to better premiums, and advisory services more reliable for the customers.
In a letter to its brokers and that the of the insurance Journal has obtained a copy, RSA claims to believe strongly in the importance of a network of independent brokers and the need to demonstrate greater transparency as to the ownership of brokerage firms, so that only the brokers who are not controlled or directed by insurance companies can designate themselves as «brokers» in the true sense of the term.
A letter to the department
Also, the insurer announces that he will send to the ministry of Finance of Quebec, a letter presenting its position, and more particularly, the negative consequences that a revision of the rule of 20 % would have on the dealers and the customers.
RSA claims, inter alia, that the maintenance of the rule of 20% will allow the brokers to remain independent, preventing conflicts of interest and in contributing to the establishment of a trust relationship between the broker and the client.
Encourage a high level of competition
The company also claims that the abolition of this limit would result in an increase in the volume of acquisition of brokerage firms and, for the purpose of controlling the distribution. This phenomenon could have the effect of reducing competition in the insurance sector
RSA stresses that the rule of 20% returns to encourage a high level of competition that, ultimately, benefits the customers. According to her, the brokers will be able to remain trusted advisors who make decisions with qualitative and informed based on the needs of their customers, and not on affiliations of the firm.