How brokers in B.C. are handling fraud and auto insurance during COVID-19

Brokers in British Columbia are temporarily allowed to conduct insurance transactions such as vehicle insurance renewals by phone and email during the novel coronavirus (COVID-19) pandemic. Measures are also being put in place to verify the identity of the customer to combat fraud.

Last month, the government of British Columbia said it would institute a temporary procedure to allow Insurance Corporation of B.C. (ICBC) customers to receive the following services from participating brokers:

• Vehicle insurance renewal, cancellation and policy changes by phone
• Changes to storage policies and temporary operating permits
• Transactions by email
• Submission of signatures electronically
• Submission of payments by phone
• Receive policy documents by email.

“ICBC, together with the B.C. government, is allowing for a temporary business continuity procedure that allows most transactions to be done over telephone and email, without the requirement for the registered owner to attend in person and without a requirement for a physical or ‘wet’ signature,” said Aly Kanji, president and CEO of InsureLine. “I don’t believe a change was made to the regulations, but the government has allowed a variance to forego the need for a signature in the current situation, on a temporary basis.”

Kanji was one of a number of brokers pushing ICBC to find a solution to enable ICBC agencies to continue to operate without having to keep offices open. The B.C. government said in a press release that many brokerages remain open for business for people who want to visit in person or for transactions that cannot be done over the phone, such as vehicle registrations and new plate policies. Transfer of a vehicle (essentially selling a used car from one registered owner to another) and out-of-province registrations will still need to be done in-person, Kanji added.

To complete an ICBC Autoplan new policy or renewal, the insured is required to attend at an ICBC agent’s office and personally sign the policy documents in order to receive the policy and the decal, Kanji explained, noting that in B.C. the annual registration and basic insurance policy are tied together. Current regulations require an agent to obtain the physical signature from the registered owner in order to renew the registration and insurance.

“As you can imagine, this would require Autoplan agencies to remain open and require the motoring public to continue to physically attend an office to obtain their renewal policy. This does not follow the protocol for social distancing,” Kanji said.

Kanji noted that insurance regulations in the province are 40 years old and haven’t changed and kept up with the times. So given that business is conducted online or over the phone, how is fraud being detected and what extra layers of security exist during this interim period?

Traditionally, the customary practice was for a broker to see a client’s driver’s licence and then ask if they still lived at that address. “Instead, we would now ask open-ended questions over the phone to confirm the identity of the individual; not much different than how a credit card company or bank would verify your identity over the phone,” Kanji said, using the examples of name, address, postal code, birthdate and [driver’s licence] to confirm the identity of the caller.”

For signatures, the client is given two options:

• They can print the document, sign it, and scan it back or take a photo and send it back; or
• The client is sent an email where they are asked to provide confirmation when documents are sent out. It includes language such as:

By directly or indirectly replying to this email, and indicating that you agree, accept, or consent, you thereby

• represent that you are the person to whom this email is addressed
• agree that you are bound by the insurance certificate or policy (the “policy”) attached to this email, as if you had physically signed the attached policy; and
• represent that you have the necessary capacity and authority to enter into the attached policy
• agree that, if you have requested a mid-term change to an existing policy, the attached certificate reflects those changes and replaces the existing policy which is no longer valid.

The client is then asked to respond by email with the word agree, accept or consent, Kanji said, adding that all phone calls are recorded.

“With the COVID-19 outbreak impacting brokers’ offices and customers, these provisional changes are the right move to help protect the health and wellness of everyone, while continuing to meet British Columbians’ insurance needs,” said Chuck Byrne, executive director of the Insurance Brokers Association of B.C.