A Closer Look at the New Practice Audit Program A new program will see the Insurance Council work directly with licensees to provide practice guidance and address potential issues. Launching mid-September, the Practice Audit Program aims to enhance licensee support and public protection. First mentioned in the July What’s New at Council email, this article provides more detail about the program. Under the new program, practice audits will be initiated by the Insurance Council through audit requests communicated in advance to licensees. Audits will be selected based on areas of risk identified annually, as well as on a random basis. The audit process will involve an audit questionnaire form being sent to the licensee. They will have 21 days to complete and return the questionnaire for review by the Insurance Council’s Practice and Quality Assurance Team. Areas that the audit will look at include: errors and omissions insurance, authority to represent, proper recording of insurance transactions and related financial affairs, client confidentiality practices, and compliance with practice advisories. After the questionnaire is reviewed, if no issues are found, a confirmation letter will be sent and the practice audit is closed. If an issue is identified, the licensee will be contacted by phone to discuss further and may receive a practice reminder letter at which time the audit will be closed. In cases where a serious conduct or competence issue is identified, the matter will be reviewed further. By working together with licensees to prevent non-compliances through support and education, the Insurance Council is aiming to avoid potential harm to the public and regulatory breaches that end up resulting in discipline for the licensee. This approach is intended to improve public protection while helping licensees be successful in meeting their regulatory requirements. More detailed information about the Practice Audit Program will be made available on our website shortly.
Update on Changes to the Financial Institutions Act The Financial Institutions Act is the provincial legislation that governs the regulatory framework for credit unions, insurance companies and intermediaries, and trust companies in BC. Amendments to the Act were enacted in November 2019 and are being introduced in stages through regulations. Earlier in the year, we reported on a number of changes to the Act relating to the Insurance Council and its licensees that were brought into force in January. An additional set of regulations was brought into effect as of June 22, 2020. What’s Changing? This latest set of changes addresses: Licensee Remuneration – The Act now authorizes the Insurance Council to make rules regarding the remuneration of licensees. Delegation to Committees - The Insurance Council will have the ability to delegate a hearing committee the authority to make enforcement decisions. Standardized Council Compensation – Insurance Council members may be remunerated in accordance with the general directives of the Treasury Board, instead of an amount established by the Lieutenant Governor in Council. What’s Next
Additional regulations to implement the Financial Institutions Act changes are anticipated over the coming months and we will continue to provide updates as more information becomes available. You can find more detailed information on the amendments to the Act on the BC government website, including amendment wording.
Annual Filing and Terminations Annual filing for 2020 concluded at the end of July. In August, licence terminations were issued to 3,729 individuals for non-filing. This year, the annual filing process was conducted entirely through the Insurance Council’s online portal. The online process resulted in a greater number of licensees initiating their filings sooner, and Insurance Council staff were able to assist licensees via support calls and emails more quickly.
Disciplinary Decisions Randal Thomas Brett Haw was disciplined for breaching the Insurance Council Rules and Code of Conduct by forging two clients’ signatures on an insurer’s application documents, obtaining copies of their signatures from their home insurance file, taking their application information over the phone without both clients on the call, and withdrawing their insurance applications without consent. More
Varinder Kaur was disciplined for breaching the Insurance Council Rules for failing to maintain errors and omissions (E&O) insurance, conducting business while she was without E&O insurance, and failing to notify the Insurance Council that she was without E&O insurance and authority to represent an agency. More
Lini Outh was disciplined for breaching the Insurance Council Rules and Code of Conduct for fraudulently transferring and insuring a vehicle in an individual’s name without their knowledge or consent and, when the transactions were discovered, fraudulently transferring the vehicle to a motor vehicle dealership. More
Grant Donald Stobbe and Okanagan Valley Insurance Services Ltd. were disciplined for breaching the Code of Conduct by processing a temporary operating permit contrary to, or without, the instructions of the registered owner of the vehicle, failing to confirm a signatory’s identity, and obtaining a forged signature. More
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