AMF expectations regarding usage-based insurance programs


Montréal - The Autorité des marchés financiers (the "AMF") is publishing a Notice about its expectations regarding usage-based insurance (UBI) programs. This initiative is intended to highlight, for insurers, firms and representatives offering damage insurance, the importance of effectively managing the risks associated with data sent via UBI programs used for automobile insurance rate-making and of acting fairly in their dealings with consumers who participate in such programs.

As consumers increasingly have access to an array of products that use driver behaviour data to set car insurance premiums, we believe it is appropriate at this time to inform industry participants of our expectations, said Louis Morisset, AMF President and CEO. "We want to ensure that consumers have access to all the information they need to make an informed decision and that insurers and service providers maintain sound practices concerning the data collected as part of UBI programs," concluded Mr. Morisset.

Fair treatment of consumers
Based on the principles and expectations set out in the Sound Commercial Practices Guideline, the AMF expects insurers and their representatives to inform consumers of the features of UBI programs, in particular the eligibility criteria, the type and use of data collected and their impact on insurance premiums.

The AMF therefore expects insurers to provide training to representatives so they can suitably advise consumers based on their needs.

Protection of personal information and privacy
The AMF is of the opinion that data collected by insurers in connection with UBI programs must be treated as personal information. Therefore, service contracts related to this type of program should include terms and conditions for overseeing service providers in order to ensure that practices pertaining to the treatment and use of insureds' data comply with An Act respecting the protection of personal information in the private sector. The Commission d'accès à l'information is responsible for the enforcement of and compliance with this Act.

Advice for consumers
Before signing up for a UBI program, consumers should ensure that they fully understand the program by asking questions about the type and use of data the insurer will be collecting and how such data will be protected. They should also inquire about potential decreases or increases in premiums, and how they can withdraw from the program.

For more advice about automobile insurance, visit the AMF website.

The Autorité des marchés financiers (the "AMF") is the regulatory and oversight body for Québec's financial sector.

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