Regulatory Framework #1
A: This organization is based in Ottawa and is like a watchdog for insurance companies in Canada.
Q: What is the OSFI? (Office of the Superintendent of Financial Institutions).
. The OSFI oversees the financial health and operations of insurance providers.
. The OSFI prevents the creation of underfunded or risky insurers.
. The OSFI enforces rules to keep existing companies financially sound.
(See page 3-3 in the textbook | LO1).
A: These are the two legal systems in Canada.
Q: What are:
1. Common law
2. The Civil Code of Quebec
(See page 3-8 in the textbook | LO2).
A: This applies to both Canadian and foreign companies operating in Canada and sets the rules for creating and running insurance companies that are federally licensed.
Q: What is the "Insurance Companies' Act"?
The Insurance Companies’ Act covers three main areas:
1.Establishment of an insurance company
2.Prerequisites to operation
3.Supervision during operation
(See page 3-4 of the textbook | LO1).
A: This is a federal statute that governs the collection, use and storage of personal information.
Q? What is "PIPEDA"? (Personal Information Protection and Electronics Document Act)
According to PIPEDA, any data collected must be relevant to the task at hand and treated with the utmost confidentiality. If that information was given for one specific purpose, it can’t be used for another without the client’s clear permission. (See page 3-13 in the textbook | LO4).
A: This non-profit organization is funded by P&C insurance companies and protects policyholders against insurer insolvency.
Q: What is "PACICC"? (Property and Casualty Insurance Compensation Corporation).
PACICC is approved by regulators and functions like a safety net so that Canadians aren't left stranded if an insurance company collapses. (See page 3-7 in the textbook | LO2).
A: These are also known as "mandatory", "prescribed" or "general" conditions of an insurance policy.
Q: What are the "statutory conditions"?
Stat Conditions are built-in rules that apply to accident and sickness, auto, and fire insurance policies. (See page 3-10 in the textbook | LO3).
A: No changes are permitted to these, unless permitted by law.
Q: What are the "statutory conditions" of a policy?
The insurer and the insured may still negotiate changes or omissions but any changes that adversely affects the insured aren't binding. (See page 3-10 in the textbook | LO3).
A: In Alberta, these insurance professions must be licensed in the province(s) they work.
Q. What are "agent, brokers and independent adjusters"?
Company adjusters are under the insurance company license, except in NB NF, PE and QC where a license is still required. (See page 3-6 in the textbook | LO1).
A: These are considered a set of detailed instructions created under the authority of a statute.
Q: What are "regulations"?
A statute is the broad legal framework (Act), while a regulation provides the details and practical applications of an Act. (See page 3-9 in the textbook | LO2).
A: This Act outlines: what constitutes a contract, the basic contents of a policy, grounds for voiding a policy and limitations of action.
Q: What is the "Insurance Acts" of each province/territory?
Each province/territory prescribes the basic provisions for Life, A/S, Fire, Auto and in some provinces, even hail insurance. It also spells out the stat conditions that must be built into each type of policy. (See page 3-9 in the textbook | LO2).
A: Phishing, social engineering, malware, data theft -- are all examples of what?
Q: What are "privacy breaches"?
(See page 3-15 in the textbook | LO4).
A: This introduced compliancy agreements that allow the Office of the Privacy Commissioner of Canada ("OPC") to enter into agreements with non-compliant organizations to become compliant rather than going to court.
Q: What is the "Digital Privacy Act"?
The Digital Privacy Act was created to give Canadians stronger protection over their personal information when dealing with private businesses. Instead of immediately going to court when a company isn’t following privacy rules, the OPC can now work with that company through a compliance agreement (See page 3-15 in the textbook | LO4).
A: These are the five (5) steps organizations usually take when a suspected privacy breach has occurred.
Q: What are:
1. Identify the breach
2. Contain and mitigate the breach
3. Assess risks
4. Employ a notification strategy
5. Prevent future breaches
(See page 3-15 in the textbook | LO4).
A: This is substantially like PIPEDA in Alberta and takes precedence in the province.
Q: What is "PIPA"? (Personal Information Protection Act).
(See page 3-13 in the textbook | LO4).
A: These are main five (5) the laws impacting insurance in Canada.
Q: What are:
1.The Insurance Companies’ Act
2.The Civil Code of Quebec
3.Provincial and territorial insurance acts
4.Provincial and territorial highway traffic acts (or equivalent)
5.Regulations made pursuant to various act
Several laws and regulations oversee how insurance is conducted in Canada. (See pages 3-8 and 3-9 in the textbook | LO2).