A looming commerce struggle with the U.S., mixed with probably the most pure disaster claims losses in Canada’s historical past final yr, could also be a darkish cloud with a silver lining.
Darkish occasions are galvanizing Canada’s P&C insurance coverage business to make inter-Canadian adjuster mobility a regulatory precedence. It’s carried out that earlier than, however timing might lastly be on the business’s aspect.
Some impetus comes from a Jan. 11, 2025 open letter by former Canadian prime minister Jean Chretien revealed within the Globe & Mail urging Canadian political leaders to make the nation much less weak to cross-border commerce restrictions. He wrote: “There are extra commerce boundaries between provinces than between Canada and america. Let’s launch a nationwide undertaking to eliminate these boundaries!”
Canada’s P&C unbiased adjusting corporations have been making the case for nationwide reciprocal adjusting licensing for many years. However not too long ago, a coalition of the business’s associations ramped up lobbying efforts to maneuver the ball ahead.
The coalition consists of Insurance coverage Bureau of Canada, the Canadian Affiliation of Mutual Insurance coverage Firms, the Canadian Insurance coverage Claims Managers Affiliation, the Canadian Impartial Adjusters’ Affiliation, the Insurance coverage Brokers Affiliation of Canada, the Canadian Affiliation of Direct Relationship Insurers and the Omnia Adjusters Cooperative.
The way it works
Beneath a reciprocal licensing regime, “if an adjuster is licensed in a single province, their license is acknowledged throughout the nation,” the coalition wrote to Canadian insurance coverage regulators in September 2024. “Because it stands, every Canadian [provincial] jurisdiction has its personal guidelines and necessities for adjusters. There’s merely no affordable public coverage rationale justifying this kind of fragmented strategy to licensing.”
The business says a nationwide reciprocal licence regime is very essential within the face of elevated local weather threat, which is predicted to trigger extra NatCat claims sooner or later.
“When you concentrate on honest therapy of shoppers and good public coverage outcomes, and having claims handled in a well timed method and correctly, one would assume that [inter-provincial adjuster mobility] can be a step in that path,” says Marisa Coggin, a companion within the company and regulatory group at Dentons LLP. She spoke on the agency’s insurance coverage convention in Toronto final November.
Canada’s P&C insurers dealt with 273,000 NatCat claims in 2024, far in extra of the earlier report of 197,000 in 2016. Final yr, greater than 228,000 NatCat claims occurred in lower than a month.
Patchwork regulation
So far, provincial regulators have provided piecemeal options to permit adjusters from one space of Canada to deal with Cat claims in different Canadian jurisdictions.
In the course of the Calgary hailstorm and Jasper wildfire in 2024, for instance, the Alberta Insurance coverage Council rapidly authorized expedited adjuster licensing of non-resident adjusters.
In Quebec, the Autorité des marchés financiers eased its guidelines and allowed insurers to make use of supernumeraries as claims adjusters, together with these from different Canadian provinces and from the U.S.
A supernumerary insurance coverage adjuster is an individual who shouldn’t be licensed as a claims adjuster however is quickly allowed to behave as one.
And the Monetary Companies Regulatory Authority of Ontario carried out non permanent measures permitting insurers to make use of claims adjusters who held licences exterior the province.
Past non permanent
However these options are all non permanent, sources inform CU.
“After which the disaster passes, and we’re again onto [other regulatory priorities], regardless of the flavour of the day is,” Arthur Hamilton, a counsel in Dentons’ litigation dispute decision group, noticed throughout the agency’s insurance coverage convention in Toronto.
4 years in the past, unbiased adjusting agency CRU Group wanted groups to cope with what was then Calgary’s largest hail declare occasion. Noting Cat adjusters are very like first responders, they introduced U.S. adjusters into Canada to assist.
Usually, Canadian employers hiring non permanent international staff should get a labour market impression evaluation exhibiting no Canadian employee is obtainable for the job. The USA-Mexico-Canada Settlement governing free commerce consists of an exception to this rule for dozens of pros; amongst them, ‘catastrophe reduction insurance coverage claims adjuster[s].’
However confronted with U.S. protectionist commerce insurance policies, IBC is sounding the alarm that bringing in U.S. adjusters to might turn out to be a restricted possibility.
“As famous by the Fraser Institute, this [trade] uncertainty is making a rising crucial for Canadian policymakers to maneuver swiftly to guard the Canadian financial system from the potential impacts of protectionist insurance policies,” Margot Whittington, senior coverage advisor at IBC, wrote in a December 2024 weblog post. “One step Canadian policymakers can take is to eradicate interprovincial boundaries to commerce, capital flows, and labour mobility.
“Particularly, ought to a Canadian-US commerce dispute pose limitations on Canada’s capacity to faucet into American adjuster capability, Canadian adjuster capability might be examined like by no means earlier than.”
This text is excerpted from one which appeared within the February-March print version of Canadian Underwriter. Function picture by iStock/scibak
