To the universal horror of the
Canadian banking sector, the country’s finance minister, Jim
Flaherty, has signalled his intention to prevent banks marketing
insurance products online, a policy at odds with the country’s bank
regulator who ruled the practice legal as recently as June.
Legislation dating back to 1991 states banks
can only promote insurance “outside of a branch”, resulting in an
increasing number of banks operating insurance offices adjacent to
bank branches.
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In a further attempt to comply with the
current rules, Canadian banks have successfully increased insurance
revenue by expanding their online offerings, despite increasing
hostility from the country’s insurance brokers.
According to a statement from the Canadian
Bankers Association, which represents 50 domestic banks, Flaherty
made the change “without any public consultations with Canadians or
the banking industry”.
The statement added: “We are shocked that Mr
Flaherty would want to limit how and where consumers can access
information about insurance.”
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