Thursday, 4 July 2013

FSCO Releases Final Statement Of Priorities For 2013

Section 11 of the FSCO Act requires FSCO to deliver to the Minister of Finance and publish in The Ontario Gazette by June 30th of each year, a statement setting out the proposed priorities of the Commission for the fiscal year in connection with the administration of this Act and all other Acts that confer powers on or assign duties to the Commission or the Superintendent.

FSCO has released a final Statement of Priorities for 2013 which varies slightly from the draft released in April of this year. The changes largely reflect initiatves included in the provincial budget which passed last month.  Here is a summary of the auto insurance initiatives:

Design and implement an information technology Enterprise Development Program
  • FSCO will develop a web-based information technology system offering integrated services to stakeholders by giving them one-window access for all of their dealings with FSCO.
Work with the Ministry of Finance to implement a cost and rate reduction strategy for auto insurance 
  • FSCO will work with the Ministry of Finance on the implementation of legislative amendments from the 2013 Budget that commit to an average auto insurance rate reduction of 15 percent within a period of time to be determined by regulation, and provide the Superintendent with authority to require insurers to re-file their rates for approval.
Respond to the recommendations of the Auto Insurance Anti-Fraud Task Force
  • FSCO is addressing several recommendations. It is working with stakeholders to develop a consumer engagement and education strategy, developing an anti-fraud hotline, and will continue to work with the Ministry of Finance to implement recommendations from the Task Force, as directed by the government.
Respond to Auditor General’s 2011 Value-for- Money follow-up audit
  • The 2012 Ontario Budget included two initiatives that address the auditor’s recommendations.
  • In 2013, FSCO will begin the next five-year review of the auto insurance system which will include a review of cost containment strategies and benefit levels in other provinces.
  • FSCO considers several factors, including ROE, in reviewing the reasonableness of auto insurance rates filed by insurers.
  • FSCO is expanding its auto insurance attestation.
 Enhance auto insurance information and analysis
  • FSCO will conduct a closed claims study on third-party liability bodily injury claims in Ontario.
  • FSCO will review the data available through the Health Claims for Auto Insurance (HCAI) system.
Review and implement requirements for usage based auto insurance
  • FSCO is examining key regulatory issues and working with the auto insurance sector to ensure consumers are fairly treated when implementing voluntary usage-based auto insurance rating programs.
Work with Ministry of Finance on statutory and system reviews
  • FSCO will lead a mandated five-year review of the auto insurance system and a three-year review of the auto insurance risk classification and rate determination regulations.
Develop Minor Injury Treatment Protocol 
  • FSCO has retained medical and scientific experts to develop an evidence-based Minor Injury Treatment Protocol.
Work with the Ministry of Finance to develop and implement changes to the definition of Catastrophic Impairment

Work with the Ministry of Finance to complete a review of insurance company solvency regulation leading to recommendations for changes to the Insurance Act

Develop proposals to modernize disciplinary hearings for insurance agents and adjusters
  • FSCO will consult on proposals to create a model that aligns with the modern disciplinary, licensing, and enforcement processes and standards used in the other sectors FSCO regulates.
Implement fraud awareness stakeholder engagement strategy
  • FSCO will expand its fraud awareness social media outreach across all its regulated sectors.
  • FSCO will partner with law enforcement, the Ministry of Finance, the Ministry of Consumer Services, and industry associations in joint fraud awareness activities.
Work with other auto insurance rate regulators on common rate filing issues and requirements

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