IBC Annual General Meeting (Toronto) – December 3, 2003 – Ladies and gentlemen, I’d like to take this opportunity to give you a brief tour of the horizon and outline our plans and priorities for this current fiscal year. It’s an ambitious yet achievable agenda that directly reflects the needs and goals of our members. We find ourselves in year three of our five-year plan, as adopted by our board of directors, to address public policy priority issues as identified by our members in 2000.
Auto Insurance reform remains a top priority. Even though we have made significant progress on a number of fronts, much remains to be done.
Auto Insurance regulations are either being reviewed or reformed in every region of the country. Much of it, I am pleased to say, is being driven by the efforts of IBC. We recognize that product reform is critical to keeping costs down and governments are now beginning to agree.
In Ontario, we are working hard to secure the passage of reform legislation now on the table. This legislation addresses the trends that impact the costs of providing auto insurance to Ontario drivers. We are dedicated to seeing it become law and are currently working with government and health care providers to establish fair treatment guidelines through regulation.
On the east coast, parallel efforts are underway to vigorously support reform legislation in the Atlantic Provinces. In Quebec, IBC will work with the government’s steering committee to review any recommended changes to the current regime.
In British Columbia we will, of course, continue to press for changes that will free the public from an outdated and expensive state monopoly and offer them the kind of service only our members can provide. We have publicly expressed our disappointment with recent announcements in BC, but continue to work closely with the government’s Core Services Review process.
Taken together these efforts, and others that are too many for me to list now, will have a powerful and positive impact on our members’ balance sheets from coast to coast.
Financial Services Sector reform is another issue that we anticipate will resurface in the near future. Although new legislation enacted in October 2001 to govern business operations of insurance companies, banks, trust companies, credit unions and other financial institutions curbs the urgency of the bank insurance issue for the next five years, IBC has already started to prepare for the next debate on financial services reform.
IBC is also following the federal government’s commitment to its promise of a new policy framework that promotes efficiency & growth, fosters competition, enhances the regulatory environment and protects the interests of consumers.
On the health care front, IBC is now working hard on a range of important initiatives and we expect it will remain a key item for several years to come. A CEO Steering Committee supported by an advisory group of industry specialists and a multi-disciplined team of IBC staff is directing this national effort.
Let me give you just a couple of examples of initiatives we are currently moving forward on in this area:
We are rallying our members and regulatory authorities to support a whiplash pilot program. This program will help our members and health care professionals diagnose and treat the condition more effectively while reducing the opportunity for fraud.
In Ontario, we are working to consolidate the industry-wide use of the paper-based standard invoice and, at the same time, we’re developing an even more efficient electronic based system.
In the area of road safety, we have undertaken two important initiatives.
The first is the launch of IBC’s 3-year National Road Safety Campaign: Rest Up! Save Your Neck. The awareness campaign began on November 21 with more than 50 media stories and will continue to focus on educating drivers about proper headrest adjustment to prevent whiplash and soft tissue injuries.
The second initiative is a claims experience research study to support our lobby on the issue of medically-at-risk drivers.
IBC’s efforts to restore an effective and fair regulatory environment are continuing on both the federal, provincial and territorial levels. Our goal is simple: to help strike the right balance between government regulation and the efficiencies of a free market.
That effort includes harmonizing the plethora of different rules our members now confront in all the various jurisdictions. That’s one reason IBC is now developing a model provincial regulatory regime with a uniform framework that can be applied in every province.
We have also partnered with OSFI to look beyond Canada’s borders and examine capital requirements in countries around the world. We know that many lessons learned abroad can be applied here at home to the benefit of our members and their customers.
I’m pleased to report that support for our Strategy for Disaster Prevention program continues to grow both inside and outside government. We are introducing a local community recognition program that will encourage municipalities to better prepare for potential disasters.
Personal privacy versus our members’ need for information to fight fraud is a debate that’s now unfolding across the country. IBC is fully engaged in that debate and we intend to ensure that the right balance is struck in every jurisdiction.
Once again, harmonizing the rules in all the provinces is a key priority. That’s why we are now developing a privacy compliance model to serve as a template for all provinces. At the same time we are launching a campaign aimed at consumers to raise awareness and support.
On the issue of auto theft, we are continuing to build on the tremendous progress we’ve made so far. IBC is an industry leader on the auto theft issue, engaging the public in discussion and generating media coverage and exposure. The release of IBC’s study “Theft Trends by Vehicle Age” received more than 100 media hits and addressed the need for protection of older vehicles and their parts from theft.
Another study being conducted is one on the disturbing links between auto theft, organized crime and terrorism.
Stolen cars have become one of Canada’s leading exports. To help put a stop to it, we are negotiating additional international agreements that will lead to more and more stolen vehicles being recovered.
IBC is increasing efforts to keep members informed on our progress in this fight and share in its successes.
Keep in mind that every time we advance an industry issue we need to substantiate our efforts with facts that come from reliable, quality data. IBC uses industry-supplied data to support its lobby efforts, and, in turn, serve the interests of our members. We are now developing data programs that will enhance data accuracy and offer more flexible access. Again, this is a collaborative effort essential to meeting our members’ needs effectively.
After two years of record weak industry results, restoring healthy earnings is the priority for P&C insurers in 2003. The current hard market will strengthen underwriting results and profitability, but it will take time to work out of these difficulties. Results are expected to remain disappointing through 2003.
As we know, the image of the P&C insurance industry is closely linked to the public’s perception of insurance premiums. When there are no, or only small, premium increases, the public’s perception tends to be positive. Conversely, when there are significant rate increases, the public’s favorable perception of the insurance industry tends to erode. In the current market, where the industry is making adjustments to their business practices, managing the public’s perception of our industry is challenging. Members can be assured that their association will do its best to meet that challenge.
Finally, as I mentioned at the beginning, this is an ambitious yet achievable agenda. One we can all be proud of. Of course, I’ve only outlined a few of the highlights and we have a detailed report on our programs for this fiscal year available here for you to pick up.
I want to thank you for your support and all of us at IBC look forward to delivering the results our members deserve.
On a personal note, I would like to thank my predecessor, George Anderson, for his assistance during our transition and the entire IBC staff for their continued dedication and hard work.
Thank you and I hope you enjoy the rest of the meeting.