IBC hails auto insurance fraud reform by Ontario government

Toronto, ON (Jan. 22, 2013) – Insurance Bureau of Canada congratulates the Ontario government on its most recent efforts to tackle auto insurance fraud. Late yesterday the government announced that it would be introducing new regulatory amendments aimed at making insurers, consumers and health care providers more accountable when dealing with claims as a result of motor vehicle accidents. The proposed regulations would be another important step toward stamping out fraud and reducing the cost of automobile insurance premiums.

“We congratulate the government for moving ahead with these crucial reforms,” says Ralph Palumbo, Vice-President, Ontario, with IBC. “The proposed regulations would make the system more transparent and fairer for everyone – consumers, insurers and health care providers. We all need to work together to fix our broken system.”

Under the new rules:

  • Insurers would be required to provide claimants with all reasons for denying a claim.
  • Claimants would have the right to receive a bi-monthly detailed statement of benefits paid out on their behalf.
  • Claimants’ role in preventing fraud would be increased. For example, they would be required to confirm their attendance at health clinics.
  • Health care providers would be subject to sanctions for overcharging insurers for goods and services and, providers would be banned from asking consumers to sign blank claims forms.

Requiring claimants to be more vigilant about their involvement in the claims process after a motor vehicle accident is a crucial move, Palumbo says. “Claimants can help stop abuse by being active participants in their own healing,” he says.

The new rules would also help curb abuses by a small minority of unscrupulous health care providers who scam the system by overcharging.

Finally, requiring insurers to provide reasons for denying a claim and details of benefits paid out are positive steps. They reinforce the industry’s position that everyone – including insurers – has a role to play in fighting fraud.

“Insurers are ready to do their part,” adds Palumbo. “More reforms are needed. We are optimistic that, if we all work together, we can achieve a better auto insurance system for consumers.”

IBC continues to advocate for a range of reforms to the Ontario auto insurance system, including the adoption of a new science-based definition of catastrophic loss and the licensing of health clinics that assess and treat injured people who make auto insurance claims. It is currently conducting a wide-ranging consumer education campaign to explain to Ontarians how auto insurance works, and highlight the high cost of fraud and its effect on premiums.

About Insurance Bureau of Canada

Insurance Bureau of Canada is the national industry association representing Canada’s private home, car and business insurers. Its member companies represent 90% of the property and casualty (P&C) insurance market in Canada. The P&C insurance industry employs over 115,000 Canadians, pays more than $7 billion in taxes to the federal, provincial and municipal governments, and has a total premium base of $44 billion.

To view media releases and information, visit the media section of IBC’s website at www.ibc.ca and for IBC on Twitter follow @insurancebureau.

SOURCE: Insurance Bureau of Canada

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