Saturday, 28 March 2015

New Inspection Powers to Address Auto Insurance Fraud

New inspection powers that were included in the Fighting Fraud and Reducing Automobile Insurance Rates Act, 2014 come into effect on April 1, 2015.

The Consumer Protection Act, 2002 has amended to regulate consumer transactions involving tow and storage services and establishes rules for the towing and vehicle storage industries through measures that tackle questionable practices.

As examples, rules are provided for:

1. Disclosure of information to consumers.
2. Requirements that tow and storage services provided to consumers be authorized.
3. Deviating from estimated payment amounts.
4. The provision of itemized invoices.
5. Insurance requirements.
6. Publication of rates.
7. A Tow and Storage Consumers Bill of Rights.
8. Requirements that consumers be allowed to remove personal property from towed or stored vehicles.
9. The establishment of qualifications for tow and storage providers.

New inspectors will be appointed under the Consumer Protection Act in order to take a more preventative and targeted approach to enforcement through the use of education and awareness materials and new tools such as warning letters.

With these new changes, inspectors will be able to:

  • Proactively enter a place of business in Ontario Examine documentation relevant to an inspection 
  • Require the person being inspected to cooperate in the inspection 
  • Issue orders to address and correct consumer issues, where appropriate.
This is part of an ongoing process in implementing recommendations made by the Automobile Insurance Anti-Fraud Task Force.

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