Auto Insurance News and Information
IBAO Supports Bill to Protect Consumers by Limiting Referral Fees
Toronto, ON (Mar. 10, 2017) – The Insurance Brokers Association of Ontario (IBAO) supports MPP Mike Colle's Private Members Bill 103, Personal Injury and Accident Victims Protection Act, 2017, introduced in the Ontario Legislature on March 8, 2017.
Bill 103 would help to protect consumers by amending the Law Society Act to prohibit licensees from soliciting, accepting or paying a referral fee in the case of a personal injury claim. The Bill would also stop licensees from referring a client with a personal injury claim without their express written consent. Moreover, the Bill would amend the Solicitors Act, which would cap any new contingency fee arrangement at 15 percent of the award. Any amount paid to the solicitor in excess of that percentage must be reimbursed.
IBAO has been a strong advocate for the limitation of referral fees, voicing this recommendation as part of their 2017 Pre-Budget Submission. IBAO calls for transparency in all legal costs surrounding auto insurance, including referral fees. Prescribing a consumer-friendly and publicly available fee disclosure report should be required by all legal actors in order to protect the interests of the consumer.
"Insurance brokers across Ontario are working hard to advocate for affordable automobile insurance balanced with the benefits and protection of consumers' needs," IBAO CEO Colin Simpson states. "A major cost driver on the auto insurance product has been zealous litigation incented by contingency and referral fees. IBAO is supportive of Bill 103 which would help to protect consumers and keep costs down. All other parties in auto insurance industries are already required to disclose their compensation – it's time lawyers and paralegals do the same."
The Insurance Brokers Association of Ontario is a ‘not for profit’ association that represents and serves the interests of more than 12,000 independent Property & Casualty Insurance Brokers in the Province of Ontario. For information about IBAO, visit www.ibao.org to receive timely news and information updates.
Source: Insurance Brokers Association of Ontario
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