Director s Message. January 29, 2010

Transcription

1 Auto Insurance Services e-newsletter January 2010 Issue 1 The Auto Insurance Services e-newsletter provides updates to automobile insurance industry stakeholders on the regulatory activities of the Auto Insurance Services Branch (AISB) of the Financial Services Commission of Ontario. AISB oversees the regulation and support of the auto insurance system. January 29, 2010 Inside this issue: Improving the Auto Insurance Rate Filing Process R&C Study of Filings Efficiency through ARCTICS Key performance measures The R&C Teams The newsletter is produced and distributed by the Financial Services Commission of Ontario (FSCO). For more information, visit FSCO s website at Director s Message FSCO is pleased to launch the Auto Insurance Services e-newsletter for automobile insurance stakeholders. The newsletter is part of our efforts to continually improve services and ensure that our actions as a regulator are transparent, efficient and effective. The newsletter aims to ensure that our clients know what to expect from our services, and understand their own responsibilities. In the 2009 Statement of Priorities, FSCO identified the need to work with stakeholders to improve the rate filing approval process. Our first newsletter focuses on the Rates and Classifications Unit s work and outlines the ways in which insurers can assist in improving the filing process. The newsletter will also keep stakeholders informed of the progress of the auto insurance reforms. We plan to publish the newsletter semi-annually along with special issues as needed. We hope you enjoy our inaugural issue. Thank you, Darlene Hall Director Automobile Insurance Services Branch

2 Improving the Auto Insurance Rate Filing Process Ensuring maximum efficiency in the automobile insurance rate filing process requires a partnership approach. Our Service Commitments In order to improve the rate filing process, FSCO staff will: ; Update FSCO s Filing Guidelines and Technical Notes on a regular basis (after consulting with insurers) to make them as clear as possible. ; Update and post FSCO benchmarks on a regular basis. ; Arrange pre-filing meetings as needed in order to understand your objectives and to facilitate completing the filings in a timely manner. ; Communicate regularly with you by: a. Sending an acknowledgement letter upon receipt of a rate filing. b. Issuing an incomplete notice when documentation is missing. c. Issuing technical questions to further our understanding of the filing. d. Sending a letter following approval of the filing to identify issues to take into account that could speed up approval of the next filing. ; Work with the Insurance Bureau of Canada (IBC) through the Canadian Auto Insurers Rate Regulators Association (CARR) to harmonize filing requirements where possible. View FSCO s guidelines on our website at FSCO is working with IBC and members of CARR to develop standardized rate profiles Stakeholder Responsibilities You can contribute to a smoother process by making sure to: ; Request a meeting with Rates and Classifications Unit (R&C) staff before filing if you are proposing significant changes. ; Review our Filing Guidelines and Technical Notes before filing. ; Ensure you have carefully considered your proposed changes to avoid significant amendments to the filing after it is sent to R&C. ; Have your materials peer-reviewed to ensure accuracy and completion before sending them to R&C. ; Explain any significant changes in assumptions from prior filings. ; Submit the filings through the web-based Automated Rates & Classifications Technical Information Communication System (ARCTICS). ; Designate a primary contact person for the filing to avoid conflicting information and speed up approval. ; Include a table of contents, page numbers, cross-referencing between exhibits, and a legible font size in the filing. We suggest a pre-filing meeting if you are planning significant changes. R&C Study of Filings We are conducting a study of the filing process to identify areas where clearer filing guidelines can be developed and timelines for review and approval can be shortened. The first step in the study is to review the quality of filings being submitted. The quality grading system uses the criteria outlined below. As of October 31, 2009, about one-third of major private passenger auto rate filings were graded as below average. 2

3 We are introducing a new system to rate the quality of filings submitted by companies Quality The filing is complete; very well documented, organized and formatted; very easy to follow and understand; all exhibits and explanations are present and correct; contains very specific applicable information; contains good summaries. The filing is complete; neither Below Average nor Good. The filing is incomplete; not organized and poorly documented; hard to follow and understand; exhibits are missing or incorrect; contradictions appear; too general no specifics; contains information that is not applicable; no summary exhibits, response to questions are not complete. Grade Good Average Below Average The most common reasons why the filings were considered below average are: The filing was incomplete because it did not contain the necessary supporting documentation (for example, there was missing data and exhibits, or incorrect data and exhibits, or cases where required exhibits were included only by reference to other portions of the filing). The documentation provided was of poor quality (for example, it had erroneous or missing references, or otherwise was generally hard to follow or understand because of the way it was presented in the filing). Communicating with the Industry FSCO communicated filing requirements to the industry in 2009 FSCO has communicated filing requirements to industry stakeholders and representatives in a number of ways. FSCO s outreach included: Posting updated guidelines and technical notes on the FSCO website in March Informing insurers representatives by of the updated guidelines. Issuing a newsletter through ARCTICS outlining the recent enhancements and future changes. Making FSCO s staff available to discuss the status of the company s filings. In addition to informing industry of the updated guidelines, FSCO solicited industry input through FSCO s Rating and Underwriting Technical Advisory Committee. Our website is now more user-friendly We also made improvements to make the website more user-friendly. The website now provides an index of Property & Casualty Auto Bulletins in one location; and only the most recent consolidated filing guidelines and bulletins for filing requirements are displayed online. Finally, we have developed a notice which confirms the receipt of sufficient information from insurers. Insurers will be issued this notice once their filing is complete, and the review of major rate filings will begin. 3

4 Efficiency through ARCTICS and Compulsory e-filing FSCO s Automated Rates and Classifications Technical Information System (ARCTICS) is operating successfully. ARCTICS benefits both insurers and FSCO by improving efficiency, communication and consistency. The percentage of filings submitted through ARCTICS is increasing. In 2008, close to 60 per cent of all filings were sent online. In 2009, the number had increased to 80 per cent. ARCTICS is currently optional, but by January 2011, it will be mandatory for insurers. Increasing efficiency through automation FSCO will require insurers to file exclusively using the ARCTICS system by January 1, ARCTICS was designed to be user-friendly and FSCO continues to make improvements based on feedback from users. The system has a new look and feel, and a more detailed activity screen has been added to display the relevant information for filings. A new message page was created to broadcast general messages from FSCO and display confidential ones for your company. The system s speed has also been improved, and the process of entering information is faster. Key Performance Measures on Filings We have compiled performance measures for the filing approval process for the 2008 and 2009 fiscal years. Highlights are: FSCO will provide regular updates on key performance measures for the filing approval process The number of Private Passenger Auto (PPA) Major rate filings approved by FSCO increased to 46 from 31 in the previous year for the same period. The average number of days to review and approve a PPA Major filing remained at 55 days, even with a 33 per cent increase in the number of filings. The R&C Teams The sound working relationships between R&C analysts, managers and insurance company rate filing staff have facilitated the joint resolution of a range of issues. FSCO facilitates this collaborative approach by dedicating individual analysts to companies and groups in the industry. Analysts can familiarize themselves with companies' business models and strategies, making their analysis of filings more expert and efficient. Just over a year ago, R&C made additional improvements to this approach. R&C staff was divided into two teams with companies assigned to one of two teams. All members of a team are now familiar with a company s filings, strategies and business models. Was this newsletter forwarded to you? Contact us at autoinsurance.einfo@ fsco.gov.on.ca and you can have the newsletter delivered to your inbox. 4

5 You can contact the members of our teams, their Team Leads, and other R&C staff by telephone or . R&C welcomes your comments and questions, and we will respond within one business day. Nick Polsoni Senior Manager The R & C Teams (in alphabetical order) Philip Adridge Rate Analyst [email protected] Fabio Fantin [email protected] Jennifer Scott Administrative Support Officer [email protected] Tony Lyon Senior Technical Analyst [email protected] Faye Chong [email protected] Michael Manella [email protected] Anna Hahamovich Team Lead [email protected] Mirella Mendicino Sood Rate Analyst [email protected] Van Norris [email protected] Janette Watt Team Lead [email protected] Contact Us Auto Insurance Services Branch Auto Insurance Division Financial Services Commission of Ontario 5160 Yonge Street, Box 85 Toronto, Ontario M2N 6L9 Telephone: (416) Fax: (416) Toll-free: TTY (416) , contactcentre@fsco,gov.on.ca Future Newsletters Progress on Auto Insurance Reforms Updates on Key Performance Measures 5