Law Times

Law Times • apriL 3, 2017 Page 11 www.lawtimesnews.com Concern that electronic communications require safeguards Red Tape Challenge opens door to innovation BY JUDY VAN RHIJN For Law Times T he Insurance Bureau of Canada is using the Ontario government's invitation for proposals to cut regulations as an oppor- tunity to lobby for technologi- cal advances in insurer-client relationships. IBC suggests the changes do not create additional risk for consumers. The insur- ance bar, while acknowledging the necessity to move with the times, is counselling caution in areas where privacy and security are at stake. "There are opportunities to use technology in Ontario in terms of adjusting practice," says Pete Karageorgos, direc- tor of consumer and industry relations for Ontario at IBC. "People are using smartphones to pay bills and buy coffee. We are looking at new ways to lever- age technology that is used in day-to-day life." The Ontario government's Red Tape Challenge is part of the Business Growth Initiative. According to provincial news releases, it aims to reshape On- tario's economy to ref lect "rapid changes in technology and globalization" and to "leverage Ontario's highly skilled work- force to compete through in- novation." IBC participated in the con- sultation period this past winter for the financial services sector, and a final report will be avail- able on July 31. David Derfel of Derfel Injury Law in Toronto has no concern about the exchange of informa- tion by electronic means. "That's the nature of com- merce today," he says. "It's be- coming paperless and cloudless. We live in a digital world." The Red Tape Challenge is soliciting suggestions on how to improve regulations in six specific sectors in order to save businesses time and money and to better protect consumers, em- ployees and the environment. The resulting action plans will then be combined into a govern- ment-wide plan to address red tape for each sector. "The insurance industry would like to be more in line with current practices, especial- ly with respect to technology," says Karageorgos. "Insurance is very heavily regulated, especial- ly in Ontario. By allowing more freedom we can meet consum- ers' needs and increase competi- tion and consumer satisfaction." The IBC submission con- tains seven recommendations, which it says the government can implement without creating additional risk for consumers. Proposals include electronic communication, digital service of applications, forms and ter- mination notices and electron- ic proof of insurance, as well as smartphone apps, usage-based insurance pricing and customer loyalty programs. The first recommendation asks for an amendment to the Insurance Act to state explicitly that all insurance transactions can be completed electronically if the consumer consents. The second asks FSCO to amend its forms to include data collection and consents so that consumers can enter into contracts and de- liver and/or receive information electronically. Elisabeth van Rensburg is an associate at Will Davidson LLP, a dual practice representing insurers and insured parties, based in Oakville, Ont. "In my experience, a lot of insurers have already started moving towards digital communication, as much as they are permitted," she says. "Most of my communications with adjusters is done via email." In relation to contracts and notices of termination, she is not so sanguine. "As someone representing in- sureds, I'm concerned if they are not getting proper notice," says van Rensburg. "Email would need different rules to ensure there's no dispute when the document is received. There will be issues arising if, say, the insurer has an outdated email address or the customer did not check their email or there is an issue with Internet connec- tion. It doesn't save money or cut costs if it leads to an increase in litigation and disputes." Van Rensburg says she thinks the industry wants to modern- ize, but it's facing hurdles. "Other businesses are going that way and other jurisdictions as well. But when purporting to deal with terminations, ap- plications for insurance and disputes between insurers, ser- vice is usually required to be by registered mail or in person," she says. "This requirement ref lects the seriousness and importance of communications between in- surers and the insured." Derfel is not so concerned with technological change in the industry, as long as proper pro- cedures are in place. "Registered mail is a fairly antiquated means of serving documents and people don't necessarily get them. If I'm go- ing to contact someone directly, contacting them electronically is a very expeditious way of do- ing it." Derfel does propose some safeguards if the change is made. "If insurance companies are go- ing to serve their customers elec- tronically, they need a mechan- ism to confirm receipt." When it comes to cancella- tion of policies, Derfel remains "old school." "It is crucial to be properly FOCUS Elisabeth van Rensburg says 'a lot of insur- ers have already started moving towards digital communication, as much as they are permitted.' See Live, page 12 What do your clients need? The means to move on. Guaranteed. ™ Baxter Structures customizes personal injury settlements into tax-free annuities that can help your clients be secure for life. » Pre- and post- settlement consultation and support » Caring professionalism for over 30 years » No fee to you or your clients Need more information? Contact us at 1 800 387 1686 or baxterstructures.com Kyla A. Baxter, CSSC PRESIDENT, BAXTER STRUCTURES Untitled-3 1 2016-10-12 10:02 AM

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