Will the real consumer advocates please stand up?

“Insurers […] are the real consumer advocates.”

Don Forgeron, President and CEO, Insurance Bureau of Canada


Where’d they dream that up?

Beyond the headlines and stories focused on the exploits of Toronto’s mayor, the IBC was also making news. As Thompson’s World Insurance News (November 11, 2013) reported, CEO Don Forgeron, at the IBC’s Regulatory Affairs Symposium, was opining on the state of the industry and that review, as it inevitably does, veered towards the apparently precarious condition of Ontario auto. As has become de rigeur in nearly every description of Ontario auto by the industry there was the rote recitation of the now legendary “losses” between 2008 and 2010.

One wonders when the industry will acknowledge that those prior year losses never happened or, perhaps more modestly, that the clock did not in fact stop in 2010. OTLA has obtained independent actuarial analysis showing that insurers actually turned modest profits between 2006 and 2010. Also, let’s recall that following those “reforms” of September 2010, which saw coverage slashed and premiums hiked, the industry went on to do so well and so quickly that one insurer, perhaps indiscreetly but apparently quite honestly, noted a few short months later that they were already seeing the benefits of the changes!  You might also wonder why the IBC is not coming clean on the fact that the industry has in fact raked in massive profits from their Ontario book of business since 2010. We know now that they made billions in profits and continue to do so.

Forgeron had stern words for politicians, who, he was quoted as saying, were appealing to a “short-term” audience. If only politicians could learn the insurers’ math! He was then quoted as saying: “so we must lead. Insurers are no longer just business people, we are the real consumer advocates.”

Really? The real consumer advocates? That’s an amazing and audacious statement.

Is this the same IBC that advocates so shamelessly for restrictions to the definition of catastrophic impairment, changes that will affect the most vulnerable of these consumers they pretend to represent? The same IBC that justifies the continued practice of subjecting claimants to intrusive and suspect medical examinations? The same IBC that stresses the incidence of fraud in the system, to the point where the casual observer might doubt the veracity of any claimant and their entitlement to benefits?

Let’s be clear: the Insurance Bureau of Canada represents insurers and their shareholders. Those interests lie in maximizing the return on equity. Most reasonable people might conclude that the core mandate of the insurance industry is not just incompatible with the consumer interest but diametrically opposed to the interests of consumers. Real consumer advocates, like the people at FAIR, are those who have been through the system and have some valuable advice and lessons for others who at this point do not even know that they will be in an accident one day. They are the ones who have nothing to gain at this point and even shoulder some risk in speaking up to a powerful industry lobby. That’s the definition of a real consumer advocate.

Contributed by John Karapita, Director of Public Affairs at OTLA.

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