New regulations relating to strata insurance
Following up on Bill 14, Municipal Affairs and Housing Statutes Amendment Act (No. 2), 2020, Government has issued an Order in Council (OIC) with new regulations under the Financial Institutions Act.
Referral payments respecting strata property insurance
The OIC brings into force changes to section 178 of the Financial Institutions Act (FIA), enacted this summer. The amendments prohibit the payment of referral fees or any other kind of compensation to property managers or anyone else who is not an insurance licensee for the sale or renewal of strata property insurance.
Notification Period for Change/Non-renewal of Existing Insurance Policy
The OIC also makes changes to the Marketing of Financial Products Regulation, made under the FIA, including changing the name of the regulation to the Financial Products Disclosure Regulation (FPDR). In instances where strata property insurance will not be renewed or will not be renewed at the same terms and conditions, the regulations will require that insurers provide clients with a notice and/or the proposed terms and conditions a minimum of 30 days prior to the expiration of their existing insurance.
If the insurer provides notice and terms to the agent instead, they must do so a minimum of 45 days prior to the expiry of the existing insurance; the agent is then responsible to provide the terms and conditions or notification of non-renewal to the client a minimum of 30 days in advance of insurance expiry.
Disclosure of Broker Compensation
The amount of compensation involved in strata property insurance sales and renewals will now need to be disclosed to the strata corporation under the amended regulations. Agents will now be required to disclose in writing the actual dollar amount of compensation they receive or, if that information is not available, an estimate of that amount and how it will be calculated. Where there is a material change to the policy terms, disclosure must be provided a minimum of 30 days prior to the expiry of the existing strata contract.
The prohibition on payment of referral fees takes effect immediately and the new FPDR disclosure requirements will come into effect November 1, 2020.
Questions on these new regulations should be directed to the Financial and Corporate Sector Policy Branch in the Ministry of Finance at FCSP@gov.bc.ca.
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Did you know . . .
. . . you won the lottery?
As 2020 – aka annus horribilus – comes to an end, I decided to depart from my usual topics and take a deeper look at what this year has really meant for all of us in BC. I’m a chronic optimist, so tried to find something good that has happened since January 1 2020!
I was not surprised to find that living in BC is equivalent to winning the lottery. Here’s why:
The world population is 7,800,000,000
4.7%, 369,000,000 live in North America
0.48%, 37,600,000 live in Canada
0.06% 5,100,000 live in BC
Stated otherwise, 99.94% of the world’s people don’t live in BC.
In 2020, BC had no earthquakes, no hurricanes, no volcanic eruptions, no major floods, and no major wildfires, compared to many USA states, Australia, New Zealand, and others.
In 2020, BC had an abundance of food compared to Yemen, South Sudan, Syria, and others.
In 2020, nearly 100% of British Columbians lived in (took for granted?) a permanent and safe home.
In 2020, our grandchildren all received quality education from professional teachers, compared to the many war torn countries where children are soldiers or refugees.
In 2020, BC had no civil war.
In 2020, BC had no political protests that turned into riots.
In 2020, BC and the USA held elections:
One person; one vote One person; one vote; then the Electoral College votes; then the House of Representatives votes; then the Senate votes to finally determines the winner – 2 months and 3 days later
The winning party leader is The President is elected separately
The losing party leader accepted Six weeks later, the losing leader has not conceded
defeat the night of the election defeat