CISRO urges due diligence in insurance shopping

Amid Fraud Prevention Month, CISRO advises verifying agent licenses to protect against fraud

CISRO urges due diligence in insurance shopping

In recognition of Fraud Prevention Month, the Canadian Insurance Services Regulatory Organizations (CISRO) urges consumers to deal only with licensed insurance providers, as announced in Newswire Canada. 

This national awareness campaign, occurring every March, aims to equip Canadians with the knowledge to recognize, reject, and report fraud. In 2022, the Canadian Anti-Fraud Centre (CAFC) documented over 50,000 fraud reports, with the reported losses surpassing $400m. 

Patrick Ballantyne, the Chair of CISRO, highlights the importance of vigilance in fraud detection, especially when purchasing insurance.  

He states, "When it comes to detecting fraud, the old adage 'if it sounds too good to be true, it probably is,' can be a guiding principle. It can also apply to shopping for insurance.”  

He further details the protective role of licensing, which demands that applicants fulfill specific educational requirements and undergo criminal background checks. Ballantyne encourages consumers to verify the licensing status of their agents and brokers as an essential protective measure.   

Ballantyne identifies several red flags that consumers should be wary of, such as significant discounts on insurance premiums, requests for payments through unconventional methods like cryptocurrency, money wiring, or gift cards, and interactions with unlicensed providers.  

He emphasizes that consumers should purchase insurance policies exclusively through licensed agents or brokers, or directly from the insurer. Additionally, when engaging with a third party for policy purchase, it is crucial to ensure the agent or broker is authorized and licensed by the provincial regulator. 

 Highlighting the importance of informed decision-making, Ballantyne reminds Canadians to understand and define their insurance needs before starting their search for a provider.  

He points out, “Not all providers offer the same products or services, and not everyone will be a good personal fit. They're working for you, so make sure you're comfortable with them.”  

He advises consumers to always verify the license, thoroughly read through the paperwork, and ask questions to ensure full understanding before signing any contracts.