The Bank Act is the law that governs banks in Canada and allows them to engage in certain lines of business. The law is clear. It states that banks shall not be in the business of insurance. Of course, the banks disagree and will continue to argue that we trust them with our mortgages, our investments, etc… why not insurance?
Insurance brokers across Canada agree that the existing restriction against banks selling insurance at the point of granting credit is right for consumers and should be maintained. The Bank Act as it stands protects consumers from coercion and undue influence when it comes to their insurance needs.
In 2018, the Insurance Brokers Association of Canada (IBAC) intensified this advocacy initiative ahead of the statutory review of the Bank Act. Meetings were held with Finance Minister Bill Morneau and senior officials. IBAC CEO Peter Braid also appeared before the House of Commons Finance committee to convey IBAC members’ long-held position that banks should not sell insurance at the point of granting credit.
This strong consumer-protection message resonated with all decision-makers, and the important blanket prohibitions in the Bank Act were upheld in the Budget Implementation Act. With the passage of this legislation, no further review of the Bank Act will occur until the year 2023.
Representation:
- Michael Bastone: Voting Delegate Board of Directors IBAC
- Shani Briffa: Observer, Board of Directors IBAC / TIC Representative on IBAC Broker Identity Program (BIP) Committee