iA Financial Group CEO Yvon Charest sees nothing wrong with consumers’ buying insurance online without representatives.
Interviewed by The Insurance and Investment Journal on the sidelines of the insurer’s annual meeting on May 5, he mentioned the work of Quebec regulator, the Autorité des marchés (AMF) in this area. “The regulator wanted to make sure that if insurance is sold online, that it be done well,” Charest says.
In its orientation document, the AMF recommends that Quebec’s Ministry of Finance take advantage of the current revision of the Act respecting the distribution of financial products and services to regulate this distribution method and make advisory services optional. “Some people will want to use the Internet exclusively as a means of obtaining insurance. We have to be prepared for that,” Charest says.
iA has already gauged consumers’ appetite for buying insurance online. “We tested auto insurance with our distribution partners. On their online auto shopping site, they offered customers the option to buy and shop around for insurance. The proportion of buyers was minuscule. Keep in mind that the consumers are on a high from buying their dream car; they’re not excited about shopping for insurance. They will do that later, at the same time as they fill out the usual paperwork,” Charest explains.
The insurer also tried out other simple products like Registered Education Savings Plans (RESP). “We also tested a tool for advisors with a button to click that would let them step into the sales cycle on the Internet. But we need more data and documentation before determining the potential for success. It is premature and useless to take firm positions for now. Clients will decide how they want to shop.”