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Winter 2017-18
Putting the brakes on
Official Journal of the Canadian Indeépendent Adjusters’ Association
BC’s auto insurance system is out of control
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Contents Winter 2017-18 • VOLUME 11 • NUMBER 6
Spotlight 12 Running past the finish line
14
Dan Langer takes on CICMA presidency in retirement BY EMILY ATKINS
Cover Feature 14 Putting the brakes on Out-of-control costs in BC’s auto insurance system must be stopped BY EMILY ATKINS
News Features
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19 Insurance implications of marijuana legalization BY JENNIFER HUNEAULT AND JASON ARCURI
21 Fentanyl – What you need to know if you encounter it BY MIKE WIEBE
23 New data requirements will make cyber coverage mandatory BY HEATHER A. SANDERSON
25 Lessons from the field in Fort Mac BY KRIS RZESNOSKI
25
23
Departments
5 First Notice 27 On the Scene
Columns 8 President’s Message
WE’RE GROWING
WITH MORE LOCATIONS TO SERVE YOU.
Coast Claims Service and Huston Grant (Kamloops) have joined forces. This means outstanding, consistent B.C. claims service from adjusters you can trust, with more locations coming soon.
VISIT US TODAY! COASTCLAIMS.COM VICTORIA » DUNCAN » COURTENAY & COMOX » NANAIMO » PORT ALBERNI POWELL RIVER » CAMPBELL RIVER » VANCOUVER » KAMLOOPS » KELOWNA
• first notice FN IBC lauds Ontario infrastructure plan The Insurance Bureau of Canada (IBC) is welcoming the climate change provisions in the Government of Ontario’s Long-Term Infrastructure Plan (LTIP). The provincial government released LTIP in late November. Ontario is investing $190 billion in public infrastructure over 13 years, including hospitals, schools, public transit, road and bridges. Part of LTIP seeks to improve the planning processes associated with major capital infrastructure projects. In addition to mitigation and adaptation, LTIP will integrate life-cycle assessments as part of the planning, procurement, development and decision-making phases of infrastructure projects. The government highlighted the need for a provincial climate change risk assessment to help build a better understanding of the vulnerabilities facing communities, infrastructure and the economy. Canada’s P&C insurers have long called on governments to introduce mechanisms for better land-use planning and more resilient infrastructure investments to help mitigate the effect that climate change can have on communities across the country. “Climate change is already having a real and lasting impact on communities across the province,” said Kim Donaldson, vice-president, Ontario, with IBC. “Severe weather events, like floods, wildfires and storms are happening with more frequency and with greater intensity. They damage homes, businesses and wreak havoc on critical infrastructure.” ●
Distracted driving on the rise Despite the consequences of distracted driving – a $280 fine and four demerit points under the Saskatchewan Government Insurance’s (SGI) Safe Driver Recognition program – it continues to be the leading cause of traffic collisions. Police in the province issued a total of 486 tickets for distracted driving – including 391 for using a cellphone while driving – during October’s traffic safety spotlight, SGI reported. Law enforcement also reported 4,286 tickets for speeding/aggressive driving, 310 impaired driving offences and 323 tickets related to seatbelts or child car seats, SGI said. In addition, over the last three years, there has been a steady increase in fatalities, injuries and collisions related to distracted driving. Last year, distracted driving was a factor in nearly 8,300 collisions and contributed to the deaths of 42 people and more than 1,200 injuries. Anti-cellphone legislation was strengthened in Saskatchewan on January 1, 2017. It prohibits drivers from using, viewing, holding or manipulating mobile devices while driving. Novice drivers are not allowed to use a cellphone of any kind, not even hands-free. On a second offence within one year drivers can have their vehicle seized for seven days. ●
5
trends to watch
Five factors, outlined below, can make or break the state of the Canadian property and casualty (P&C) insurance, says Nazir Valani, partner and national leader with KPMG in Canada’s actuarial practice. He spoke at KPMG’s Annual Insurance Conference in Toronto.
1
The Economy
The Canadian economy is on a “hot streak” right now, with 3.1 percent real GDP predicted for 2017. “As the growth increases, the insurance need increases,” Valani said. “The big question is, what will happen to NAFTA? The prediction is business will be cautious because of NAFTA and insurance companies will also be cautious.”
2
Demographics: the aging population
Canada has an aging population, and the number of seniors is projected to double by 2036, leaving fewer workers and more retirees. Insurance will focus on the needs of the aging population, but it will also need to meet the needs of Millennials (those born roughly between 1980 and 1995). Something applicable to both generations would be “a behaviour-driven model, like Fitbit, to get discounts on insurance,” Valani suggested. Immigration is also a factor, with the federal government anticipating 310,000 immigrants in 2018 and 340,000 in 2020. The influx of more people into Canada will lead to increased “insurance, savings and protection needs.”
3
Emerging technologies
Insurance companies are already using emerging technologies – including drones to survey property damage, driverless cars and predictive modelling – to improve efficiency, reduce costs and gain a competitive advantage. “It is important to continue to focus on customer need,” Valani said. “That will always be a Number 1 requirement.”
4
Interest rates
Interest rates have moved up marginally but are still pretty low. The increase “is good for insurance companies with long-term guarantees, because we need these high returns to be able to afford those long-term guarantees and make a semi-decent profit,” Valani said. However, high interest rates could mean Canadian households with record borrowing may end up with mortgage defaults or unaffordable housing, resulting in a decline in the housing market.
5
The weather
Over the last 50 years, North America has been getting hotter. “There’s a sustained increase in frequency and severity of weather events in Canada and globally,” Valani said. Canadians endured their share of weather-related events, including wildfires in British Columbia and flooding on Toronto Island for most of this past summer. ● continued on page 6...
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Winter 2017-18
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• first notice FN
...continued from page 5
Most dangerous places to drive
Who will insure Vancouver rentals?
Halifax has the highest collision frequency rate (7.9 percent) in Canada this year, according to the Allstate Insurance Company of Canada’s 2017 Safe Driving Study. It’s the third consecutive year that Halifax has topped the study of collision frequency. Ajax, Ontario (7.77 percent) and North York, Ontario (7.67 percent) rounded out the top-three communities with the highest collision frequency rate per 100 cars between 2015 and 2017.
Vancouver City Council has approved new regulations for short-term rentals, including Airbnb, legalizing rentals of less than 30 days in principal residences in the city. Now that short-term rentals are legal in Vancouver, what are the insurance implications? “Speaking to home insurance in general, in most jurisdictions, including B.C., there isn’t provincial legislation that forces people to purchase home, condo, renter/tenant insurance,” says Stefan Tirschler, product and underwriting manager at Square One Insurance Services. Tirschler said a bank would require homeowners with a mortgage to purchase home insurance for the house. “That will be a sort of collateral source of motivation to purchase home insurance,” he said. The city is “saying they will only allow you to rent part or all of your own primary residence, so it sort of stands to reason that people who are choosing to rent out part of their primary residence are relying to some degree on that supplemental income, so it’s important to choose a home insurance policy that can insure against that lost short-term rental,” Tirschler said. The city said that it’s “strongly suggesting insurance, but not requiring it,” Kaye Krishna, the City of Vancouver’s general manager of development, buildings and licensing, said. “We have not delved into the details of the terms or coverage of insurance – that’s less of a municipal consideration.” The regulations were brought forward by city staff last June to address the more than 6,000 illegal short-term rentals currently operating in Vancouver. The city estimates that at least 70 to 80 percent of existing listings will be able to operate legally in Vancouver as of April 2018. It also estimates at least 1,000 of the currently illegal rentals are not principal residences and would not be supported as short-term rentals under the new regulations. As part of the new policy, the City will have improved enforcement mechanisms, including a dedicated enforcement coordinator and an additional inspector to support complaint-driven and auditing inspections. Those who rent short-term without a licence will be subject to a fine of up to $1,000 per infraction. Until April 2018, the city will continue to pursue illegal short-term rentals, with a focus on commercial listings, unsafe listings or illegal dwellings, and “nuisance” properties. ●
Hanmer, Ontario ranked as the safest place to drive, with a collision frequency rate of only 3.65 percent. Spruce Grove, Alberta (3.79 percent) and Chelmsford, Ontario (3.82 percent) finished as second- and third-safest driving communities, respectively. Ontario is the only province to report an overall increase in its collision frequency rate – up 4.7 percent since last year. Regionally, this was driven by Metro Toronto, which saw an increase of 8.5 percent, followed by Central Ontario at 5.5 percent. The five communities with the greatest increase in collision frequency were found in southern, central and eastern Ontario. The most severe collisions can be attributed to incidents involving pedestrians and cyclists, while the second-most severe type are head-on collisions. The study examines collision data of Allstate Canada consumers in 93 communities in Alberta, New Brunswick, Nova Scotia and Ontario. ●
P&C workforce faces dramatic job losses Technological automation is going to significantly change the composition of Canada’s property and casualty insurance industry, reducing the workforce by up to 40 percent within the next five to 10 years, predicts RSA Canada president and CEO Martin Thompson. Speaking at the Insurance Institute of Canada’s At the Forefront breakfast in Toronto, Thompson said the rapidly decreasing cost of computing power has given insurance organizations an “unparalleled” ability to process and compute data. This allows insurance organizations to automate certain tasks and roles within the industry, reducing costs and increasing efficiency. The composition of the industry in the future will change as a result, he said. “I think what we are going to see is the number of people in the industry will reduce. My view would be somewhere in between 30 and 40 percent over the next five to 10 years.” Thompson said the composition of the workforce is also going to change dramatically. “If I look at claims, I think you will see less claims administration, and more [positions available in] what I call hard-core technical claims,” he said. ● 6
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Winter 2017-18
New Brunswick moves to protect innocent co-insureds New Brunswick has tabled amendments to its Insurance Act to protect innocent co-insureds in cases of intimate partner violence and property damage. Most home insurance policies exclude payment for loss or damage caused by an intentional or criminal act by any person insured by the policy. The exclusions can be invoked against innocent co-insureds in the context of separation, divorce or domestic violence if a spouse deliberately sets fire or causes damage to the property. Proposed amendments would prevent insurance companies from using exclusions to deny coverage in such cases. The amendments would allow innocent co-insureds to receive their share of compensation. The move brings New Brunswick in line with other provinces that have protections for innocent co-insureds, including British Columbia, Alberta, Saskatchewan, Manitoba, and Quebec. In these provinces, the amount paid out is determined by the innocent co-insured’s proportional interest in the damaged property. ● www.claimscanada.ca
• first notice FN Insurance prices could rise, feds say Increases in natural catastrophes and the price of reinsurance could also drive up the price of insurance products in Canada, the federal financial regulator said in November. “Our concern is in the longer run, we’ll see increases in the price of reinsurance, which will increase the price of products in Canada,” said Neville Henderson, assistant superintendent of the insurance supervision sector of the Office of the Superintendent of Financial Institutions (OSFI). “As some of the risks rise, the reinsurers may decide to not cover it and the direct writers won’t be able to recover it, so we may see an increase in the expense [category].” There has been an increase in catastrophe risk in Canada over the last decade, Henderson said at KPMG’s Annual Insurance Conference in Toronto. And global warming may further increase the number and magnitude of events. The good news is that catastrophe modelling appears to be improving. “We work on it in OSFI, and various companies are working on their own models,” Henderson said. “As we go along with these
August/September
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The Times They
catastrophes, we expect companies to take their earnings and appropriate it into their models [and] change their calibration.” Henderson said OSFI is working to ensure companies take account of the changes they have been experiencing, update their models, and understand the impact of reinsurance. “We noticed that a lot of companies really don’t understand the reinsurance coverage very well,” Henderson reported. “As a regulator, we don’t want to have any kind of imbalance or inequity in how we treat various marketers of those products. So, we need to correct some of that.” There were also several reinsurance items that companies didn’t understand or misapplied. “We want to make sure we don’t have any unintended impacts, so they’ll be a lot of discussion,” Henderson said. “And quite frankly, there are some aspects of how reinsurance is done that we’re not entirely sure how it works, so we’ll need some input from the reinsurers so we can better understand how companies can maintain enough capital.” Primary insurers in Canada should understand the reasons for reinsurers’ rate actions, the risk that the reinsurers have, and the recoverability from the reinsurers, he said. ●
2017
Are a Changing
–
age
nce Cover
ura tion of Ins The Evolu
Marijuana for Medical
Official Journal of
Published by:
t Adjusters’ Association the Canadian Indeépenden
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Message from the President La Plume du président MONICA KUZYK Happy New Year and welcome to 2018. This is a great time to be working in our industry. We are witnessing tremendous disruption, we are seeing incredible opportunities for collaboration, and as a result, our industry is alive with innovation. Every organization looking to advance digital capabilities is focused on collaboration within the company and with external partners and stakeholders. They have come to understand that this is how to create value and establish a competitive advantage. Each day we read about insurers who have abandoned their traditional methodologies in the way they connect and engage with consumers and policyholders. Their decision to transform how they do business changes the way each in which we operate as adjusters and underscores the need to build strategic partnerships and collaborate. The independent adjusting community is rising to this challenge. Firms are building new relationships with providers able to deliver solutions that enable an interconnected claims experience. Drone technology, virtual interviews, and technology platforms such as Encircle, Snapsheet and WeGoLook are being used to enhance the customer experience and deliver on the stakeholder’s brand. In this new environment, claims professionals need to exercise sound judgment in a complex environment, solve problems quickly and deliver an individualized experience that resonates with policyholders. As an extension of the carrier, adjusters must be ready to offer different options to solve policyholder problems, we must be conscientious and efficient in meeting commitments, and above all we must actively listen to what is important to the policyholder at the time of claim. Collaboration is the “act of working together to realize or achieve something successfully”. In our industry, it is also about fostering a climate of trust and respect, being transparent and able to discuss relevant issues of mutual benefit to policyholders and consumers. In the Atlantic provinces, a Protocol has been established to enable quick dispatch of qualified insurance adjusters to provide services to Atlantic Canadians in severe weather and catastrophic events. The Protocol considers quick submission and pre-approvals pending severe weather. Bringing multiple stakeholders together in the spirt of “doing things right and doing the right thing” is one of the many ways effective cooperation allows us to remain relevant. It’s a great example of collaboration and leadership. At the CIAA, over the past several months, we have opened discussions with like-minded associations in the spirit of collaboration to see how together we can create new opportunities for claims professionals to learn and network. In cultivating these relationships, the associations are better positioned to respond to emerging issues that impact the profession of claims; we can share information and better prepare for the future. Collaboration includes strengthening existing relationships. Since our AGM in September, the CIAA has engaged the Insurance Institute to assist with the evolution of the licensing qualifications process in Ontario. At the national level, the CIAA is leveraging the Insurance Institute to investigate the opportunity for an Xactimate 8
Claims Canada
Winter 2017-18
Bonne année et bienvenue 2018! C’est une bonne époque pour travailler dans notre industrie. Nous assistons à d’énormes perturbations, nous voyons d’incroyables occasions de collaboration et, par conséquent, notre industrie vibre d’innovations. Toutes les entreprises désireuses d’élargir leurs compétences numériques mettent l’accent sur la collaboration au sein de leur entreprise ainsi qu’avec les partenaires et les intervenants externes. Elles ont compris que c’est ainsi qu’elles créent de la valeur et se donnent un avantage concurrentiel. Chaque jour, nous lisons que des assureurs abandonnent leurs approches traditionnelles de connexion et d’interaction avec les consommateurs et les assurés. Leur décision de transformer leur façon de faire des affaires change la façon dont nous fonctionnons en tant qu’experts en sinistres, et souligne la nécessité de construire des partenariats stratégiques et de collaborer. La communauté des experts en sinistres indépendants relève ce défi. Les firmes établissent de nouvelles relations avec des fournisseurs capables d’offrir des solutions offrant une expérience de réclamations interconnectées. La technologie des drones, les entrevues virtuelles et les plates-formes technologiques telles qu’Encircle, Snapsheet et WeGoLook sont utilisées pour améliorer l’expérience client et pour aider à promouvoir l’image de marque du fournisseur de services. Dans ce nouvel environnement complexe, les experts en sinistres doivent faire preuve de discernement, résoudre rapidement les problèmes et offrir une expérience personnalisée qui résonne auprès des assurés. En tant qu’extension de l’assureur, les experts en sinistres doivent être prêts à offrir différentes options pour résoudre les problèmes des assurés; nous devons être consciencieux et efficaces pour respecter nos engagements et, surtout, nous devons écouter activement ce qui est important pour l’assuré au moment de la réclamation. La collaboration est «l’action de travailler ensemble pour réaliser ou atteindre quelque chose avec succès». Dans notre industrie, il s’agit également de favoriser un climat de confiance et de respect, d’être transparent et d’être capable de discuter des questions d’intérêt mutuel pertinentes pour les assurés et les consommateurs. Dans les provinces de l’Atlantique, un protocole a été mis en place pour permettre la répartition rapide d’experts en sinistres qualifiés afin d’offrir aux Canadiens de l’Atlantique des services en cas de phénomènes météorologiques violents et de sinistres catastrophiques. Le protocole prévoit des soumissions et des pré-approbations rapides en cas de conditions météorologiques violentes. Parmi les nombreux moyens dont nous disposons pour collaborer efficacement et pertinemment, il y a notre capacité de réunir plusieurs intervenants dans le but de «faire les choses correctement et de faire ce qui est juste». C’est un excellent exemple de collaboration et de leadership. Au cours des derniers mois, l’ACEI a, dans un esprit de collaboration, ouvert des discussions avec des associations partageant les mêmes idées afin de discuter de la façon dont nous pouvons, ensemble, créer de nouvelles occasions d’apprentissage et de réseautage pour les experts en sinistres. En cultivant ces relations, les associations sont mieux placées pour répondre aux problèmes émergents qui ont des répercussions sur la profession d’expert en sinistres, elles peuvent partager l’information et mieux se préparer pour l’avenir. La collaboration comprend le renforcement des relations existantes. Depuis son AGA de septembre, l’ACEI a engagé l’Institut d’assurance pour l’aider à faire évoluer le processus d’obtention de permis en Ontario. À l’échelle nationale, l’ACEI fait appel à l’Institut d’assurance pour étudier l’opportunité d’une offre de formation sur le logiciel Xactimate. Cela permettra d’assurer que les experts sont qualifiés et possèdent les compétences nécessaires la prochaine fois qu’un sinistre surviendra. www.claimscanada.ca
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software training offering. This will ensure adjusters are qualified with the necessary skills when disaster next strikes. The CIAA/CICMA/CDL joint seminar on November 14th, 2017 was another great example of collaboration. This sold-out educational event provided opportunity for learning across all lines of claims and emphasized the importance of making available relevant learning within our profession. The CIAA is committed to ensuring these joint ventures continue and we thank the CICMA (Canadian Insurance Claims Managers Association) and CDL (Canadian Defence Lawyers) for their continued support across Canada. Collaboration is that ability to develop, maintain and strengthen relationships internally while forging connections with key stakeholders, cultivating win-win relationships and building coalitions externally. I’ve been fortunate to work with individuals who model these behaviors and attributes. While some have titles behind their names, many more are individuals who talk open and honestly, they speak up and share their views constructively and ultimately know how to achieve results. Recently, it has been noted that the number of people leaving the industry will be 30 to 40 percent over the next five to 10 years, and the composition of the workforce is going to change. Technology is identified as the driver of this change. At CIAA, we believe it is creativity and collaboration that drives innovation and change. We’re exploring new solutions to old challenges, forging new relationships to leverage the expertise and experience of proven industry partners to help us move forward. These are exciting times. On behalf of the CIAA, I extend sincere best wishes for the year ahead. ■ Sincerely Monica Kuzyk
Le séminaire conjoint ACEI / ACDSA / CDL du 14 novembre 2017 constitue un autre excellent exemple de collaboration. Cet événement éducatif tenu à guichet fermé a donné aux participants l’occasion d’en apprendre davantage dans toutes les catégories de réclamations et a mis l’accent sur l’importance d’offrir un apprentissage pertinent au sein de notre profession. L’ACEI s’engage à ce que cette coentreprise se poursuive et remercie l’ACDSA (Association canadienne des directeurs de sinistre d’assurance) et la CDL (Canadian Defence Lawyers) pour leur soutien continu à travers le Canada. La collaboration est cette capacité à développer, maintenir et renforcer les relations internes tout en forgeant des liens avec les principaux intervenants, à cultiver des relations gagnant-gagnant et à créer des coalitions. J’ai eu la chance de travailler avec des gens qui personnifient ces comportements et ces qualités. Alors que certains ont des titres derrière leur nom, beaucoup d’autres sont des individus qui parlent ouvertement et honnêtement; ils prennent la parole et partagent leurs points de vue de manière constructive et, ultimement, savent comment obtenir des résultats. On a souligné récemment que le taux de personnes qui quitteront l’industrie sera de 30 à 40 pour cent au cours des cinq à dix prochaines années, et que la composition de la main-d’œuvre va changer. La technologie est identifiée comme étant le moteur de ce changement. À l’ACEI, nous croyons que l’innovation et le changement sont stimulés par la créativité et la collaboration. Nous cherchons de nouvelles solutions aux vieux défis. Nous créons de nouvelles relations pour profiter de l’expertise et de l’expérience de partenaires industriels éprouvés qui nous aideront à aller de l’avant. Nous vivons à une époque passionnante. Au nom de l’ACEI, j’offre mes meilleurs vœux pour la nouvelle année. ■ Salutations, Monica Kuzyk
NATIONAL EXECUTIVE 2017 - 2018 PRESIDENT Monica Kuzyk, FCIP, CRM Curo Claims Services 125 Northfield Dr. W., P.O. Box 218 Waterloo, ON N2J 3Z9 Phone: (866) 952-2876 Fax: (519) 888-9704 E-mail: mkuzyk@curocanada.com
TREASURER Jeff Edge, CIP, CFEI Leading Edge Claims Services Inc. P.O. Box 1399, 78 Highway 20 West Fonthill, ON L0S 1E0 Phone: (289) 897-8676 Fax: (289) 897-8677 E-mail: jeff@leadingedgecs.ca
1ST VICE-PRESIDENT Troy Quigley, BBA, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 - 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-0775 E-mail: tquigley@cl-na.com
PAST-PRESIDENT Heather Matthews, CIP, CRM, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Dr. Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Heather.Matthews@crawco.ca
2 VICE-PRESIDENT Sarah Hirst, CIP, CRM, FCIP ClaimsPro #101, 5083 Windermere Blvd. S.W. Edmonton, AB T6W 0J5 Phone: (800) 565-3128 Fax: (780) 489-8841 E-mail: sarah.hirst@scm.ca ND
SECRETARY Christopher Bartlett, BA, CIP Crawford & Company (Canada) Inc. 400 – 90 Matheson Blvd. West Mississauga, ON L5R 3R3 Phone: (905) 602-9511 Fax: (905) 602-7297 E-mail: Christopher.Bartlett@crawco.ca
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EXECUTIVE DIRECTOR Patricia M. Battle Canadian Independent Adjusters’ Association/L’Association Canadienne des Experts Indépendants Centennial Centre, 5401 Eglinton Avenue West, Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Toll Free: 1-877-255-5589 Fax: (416) 621-7776 E-mail: pbattle@ciaa-adjusters.ca DIRECTOR Paul Féron, FCIP, CRM ClaimsPro 210 – 746 Baseline Rd. East London, ON N6C 5Z2 Phone: (519) 645-6500
Fax: (519) 645-2250 E-mail: paul.feron@scm.ca
Fax: (905) 896-3485 E-mail: apoon@cl-na.com
DIRECTOR Sean Forgie, BA, CIP, CFEI ClaimsPro 1550 Enterprise Road, Suite 310 Mississauga, ON L4W 4P4 Phone: (877) 753-0753 Fax: (905) 565-0009 E-mail: sean.forgie@scm.ca
DIRECTOR Troy Quigley, BBA, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 - 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-0775 E-mail: tquigley@cl-na.com
DIRECTOR James B. Eso, CIP, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca
DIRECTOR Marie C. Gallagher, FCIP, CRM Kernaghan Adjusters Limited 602 – 1 St. Paul Street St. Catharines, ON L2R 7L3 Phone: (289) 786-1074 Fax: (289) 723-1979 E-mail: mgallagher@kernaghan.com
DIRECTOR E. Grant King, BA, B.Ed., CIP Crawford & Company (Canada) Inc. 120 – 237 Brownlow Avenue Dartmouth, NS B3B 2C7 Phone: (902) 468-7787 Fax: (902) 468-5822 E-mail: Grant.King@crawco.ca DIRECTOR Albert Poon, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 – 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181
DIRECTOR Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 2001 Sheppard Ave. East, Suite 810 Toronto, ON M2J 4Z8 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com DIRECTOR Gary Ellis, BBA, FCIP, RF, FCLA, FCIAA, FIFAA AMG Claims Inc. P.O. Box 2102 Sherwood Charlotteton, PE C1A 9E3 Phone: (902) 628-9091 Fax: (902) 628-9093 E-mail: gary.ellis@amgclaims.ca
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Fin Me
CIAA REGIONAL PRESIDENTS 2017 – 2018 NEWFOUNDLAND & LABRADOR Gejapathy Gopal, CRM ClaimsPro 27 Duffy Place, P.O. Box 8686, Station A St. John’s, NL A1B 3T1 Phone: (866) 726-7815 Fax: (709) 726-6106 E-mail: gejapathy.gopal@scm.ca NOVA SCOTIA M. Kenneth MacLeod, CIP Crawford & Company (Canada) Inc. 210 – 500 Kings Road Sydney, NS B1S 1B1 Phone: (902) 564-4519 Fax: (902) 539-0071 E-mail: Ken.Macleod@crawco.ca NEW BRUNSWICK & PRINCE EDWARD ISLAND Greg Potten, BPE, CIP, CFEI, CRM, CLA AMG Claims Inc. 212 Queen Street, Unit 308 Fredericton, NB E3B 1A8 Phone: (506) 458-9000 Fax: (506) 458-9595 E-mail: greg.potten@amgclaims.ca QUEBEC/AESIQ Michel Lacelle, PAA/CIP ClaimsPro 255 Crémazie Est, 2e étage Montréal, QC H2M 1M2 Phone: (514) 340-8959 Fax: (514) 342-5474 E-mail: michel.lacelle@scm.ca ONTARIO Niki McConnell, BA (Hons.), CIP, CRM TC Insurance Adjusters Ltd. 6-2400 Dundas Street West, Suite 388 Mississauga, ON L5K 2R8 Phone: (877) 663-0701 Fax: (905) 916-0242 E-mail: nmc@tcia.ca MANITOBA Craig Shanks, BA, CIP Wheat City Claims Services Ltd. 64 Regent Cres. Brandon, MB R7B 2W9 Phone: (204) 725-7436 Fax: (204) 725-7437 E-mail: craig.shanks@mymts.net SASKATCHEWAN Lee Dixon, B. Comm., CIP Midwest Claims Services #3 – 2217 Hanselman Court Saskatoon, SK S7L 6A8 Phone: (306) 668-0873 Fax: (306) 249-4114 E-mail: lee@midwestclaims.ca WESTERN Jody Schmidt, B. Comm., CIP Crawford & Company (Canada) Inc. 203, 3114 Calgary Trail NW Edmonton, AB T6J 6V4 Phone: (780) 486-8024 Fax: (780) 486-9001 E-mail: Jody.Schmidt@crawco.ca PACIFIC Stacy Phillips, B.Comm., CRM, FCIP ClaimsPro 600, 1111 Melville Street Vancouver, BC V6E 3V6 Phone: (888) 681-6331 Fax: (604) 681-6388 E-mail: stacy.phillips@scm.ca
10 Claims Canada
Winter 2017-18
National Standing Committees 2017-2018 ADVISORY Troy Quigley, BBA, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 - 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-0775 E-mail: tquigley@cl-na.com Sarah Hirst, CIP, CRM, FCIP ClaimsPro #101, 5083 Windermere Blvd. S.W. Edmonton, AB T6W 0J5 Phone: (800) 565-3128 Fax: (780) 489-8841 E-mail: sarah.hirst@scm.ca Heather Matthews, CIP, CRM, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Dr. Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Heather.Matthews@crawco.ca Paul Féron, FCIP, CRM ClaimsPro 210 – 746 Baseline Rd. East London, ON N6C 5Z2 Phone: (519) 645-6500 Fax: (519) 645-2250 E-mail: paul.feron@scm.ca Sean Forgie, BA, CIP, CFEI ClaimsPro 1550 Enterprise Road, Suite 310 Mississauga, ON L4W 4P4 Phone: (877) 753-0753 Fax: (905) 565-0009 E-mail: sean.forgie@scm.ca James B. Eso, CIP, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca E. Grant King, BA, B.Ed., CIP Crawford & Company (Canada) Inc. 120 – 237 Brownlow Avenue Dartmouth, NS B3B 2C7 Phone: (902) 468-7787 Fax: (902) 468-5822 E-mail: Grant.King@crawco.ca Albert Poon, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 – 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-3485 E-mail: apoon@cl-na.com Marie C. Gallagher, FCIP, CRM Kernaghan Adjusters Limited 602 – 1 St. Paul Street St. Catharines, ON L2R 7L3 Phone: (289) 786-1074 Fax: (289) 723-1979 E-mail: mgallagher@kernaghan.com Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 2001 Sheppard Ave. East, Suite 810 Toronto, ON M2J 4Z8 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com CAREER RECRUITMENT PLANNING Richard Swierczynski, BA, CIP AZ Claims Services Inc. 1500 Upper Middle Rd., Unit #3, P.O. Box 76041 Oakville, ON L6M 3G3 Phone: (905) 825-0027 Fax: (905) 825-5543 E-mail: richard@azclaims.ca COMMUNICATIONS Richard Swierczynski, BA, CIP AZ Claims Services Inc. 1500 Upper Middle Rd., Unit #3, P.O. Box 76041 Oakville, ON L6M 3G3 Phone: (905) 825-0027 Fax: (905) 825-5543 E-mail: richard@azclaims.ca
John D. Seyler, CIP Integrated Insurance Resources 5080 Timberlea Blvd., Suite 214 Mississauga, ON L4W 4M2 Phone: (905) 238-4985 Fax: (905) 238-2735 E-mail: jseyler@integrated-ins.ca CONSTITUTION & RULES Paul Féron, FCIP, CRM ClaimsPro 210 – 746 Baseline Rd. East London, ON N6C 5Z2 Phone: (519) 645-6500 Fax: (519) 645-2250 E-mail: paul.feron@scm.ca CONVENTION Troy Quigley, BBA, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 - 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-0775 E-mail: tquigley@cl-na.com DESIGNATION/EDUCATION Gary Ellis, BBA, FCIP, RF, FCLA, FCIAA, FIFAA AMG Claims Inc. P.O. Box 20102 Sherwood Charlottetown, PE C1A 9E3 Phone: (902) 628-9091 Fax: (902) 628-9093 E-mail: gary.ellis@amgclaims.ca Robert V. Pearson, CLA, FCIAA CIAA Honorary Life Member c/o CIAA National Office 5401 Eglinton Ave. W., Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Fax: (416) 621-7776 E-mail: info@ciaa-adjusters.ca Lorne Montgomery, CIP, FCIAA, FCLA Crawford & Company (Canada) Inc. 300-123 Front St. W. Toronto, ON M5J 2M2 Telephone: 416-867-1188 Fax: 416-867-1925 E-Mail: lorne.montgomery@crawco.ca EDITORIAL Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Dr. Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca John M. Sharoun, FCIP, FCIAA, CRM Crawford & Company (Canada) Inc. 300 – 123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 867-1188 Fax: (416) 867-1925 E-mail: John.Sharoun@crawco.ca EMERGENCY MEASURES Richard Van Horne Action Investigations Inc. 2 Catelina Court Dartmouth, NS B2X 3G9 Phone: (902) 462-1222 Fax: (902) 462-3688 E-mail: richardvanhorne@actioninvestigations.ca FINANCE Jeff Edge, CIP, CFEI Leading Edge Claims Services Inc. P.O. Box 1399, 78 Highway 20 West Fonthill, ON L0S 1E0 Phone: (289) 897-8676 Fax: (289) 897-8677 E-mail: jeff@leadingedgecs.ca Monica Kuzyk, FCIP, CRM Curo Claims Services 125 Northfield Dr. W., P.O. Box 218 Waterloo, ON N2J 3Z9 Phone: (866) 952-2876 Fax: (519) 888-9704 E-mail: mkuzyk@curocanada.com Heather Matthews, CIP, CRM, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Dr. Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Heather.Matthews@crawco.ca
IBC: LIAISON, LEGISLATIVE & FORMS Lee Powell Vericlaim Canada 5915 Airport Road, Suite 201 Mississauga, ON L4V 1T1 Phone: (905) 671-7834 Fax: (905) 671-7819 E-mail: lee.powell@vericlaim.ca LICENSING J. Miles O. Barber, B.Comm. (Hons.), FCIP, CRM, RF Network Adjusters Ltd. 67 Folkestone Blvd. Winnipeg, MB R3P 0B4 Phone: (204) 897-5793 Fax: (204) 897-5797 E-mail: mbarber@mts.net MEMBERSHIP & QUALIFICATIONS Marie C. Gallagher, FCIP, CRM Kernaghan Adjusters Limited 602 – 1 St. Paul Street St. Catharines, ON L2R 7L3 Phone: (289) 786-1074 Fax: (289) 723-1979 E-mail: mgallagher@kernaghan.com NOMINATING Heather Matthews, CIP, CRM, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Dr. Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Heather.Matthews@crawco.ca Monica Kuzyk, FCIP, CRM Curo Claims Services 125 Northfield Dr. W., P.O. Box 218 Waterloo, ON N2J 3Z9 Phone: (866) 952-2876 Fax: (519) 888-9704 E-mail: mkuzyk@curocanada.com Paul Féron, FCIP, CRM ClaimsPro 210 – 746 Baseline Rd. East London, ON N6C 5Z2 Phone: (519) 645-6500 Fax: (519) 645-2250 E-mail: paul.feron@scm.ca Troy Quigley, BBA, CIP Cunningham Lindsey Canada Claims Services Ltd. 1102 - 50 Burnhamthorpe Rd. W. Mississauga, ON L5B 3C2 Phone: (905) 896-8181 Fax: (905) 896-0775 E-mail: tquigley@cl-na.com Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 2001 Sheppard Ave. East, Suite 810 Toronto, ON M2J 4Z8 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com PRIVACY James B. Eso, CIP, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca Keith P. Edwards, FCILA, CLA, FUEDI-ELAE ClaimsPro 120 Adelaide St. W., Suite 2401 Toronto, ON M5H 1T1 Phone: (416) 777-4479 Fax: (416) 360-7335 E-mail: keith.edwards@scm.ca PROFESSIONAL PRACTICES Heather Matthews, CIP, CRM, CIOP Crawford & Company (Canada) Inc. 539 Riverbend Dr. Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Heather.Matthews@crawco.ca
www.claimscanada.ca
CANADIAN INSURANCE CLAIMS MANAGERS' ASSOCIATION/ CANADIAN INDEPENDENT ADJUSTERS' ASSOCIATION UNITED & COMMITTED LEADERSHIP THROUGH EDUCATION * PROFESSIONALISM * COMMUNICATION
.
DUTY OF CARE WORKSHOP… ARE YOU EXPOSED? An Interactive Format with Industry Experts Discussing Potential Exposures Relative to:
Autonomous Vehicles; Sandra Corbett, QC, Field Law
Care, Custody and Control – Parked Vehicles and Drones; Christina Polano, Thomas, Gold, Pettingill
Parental Liability – Bullying and Social Media; Patricia Forte, Miller Thomson
------------------------------------------------------------------------------------------------------------------------------------------- Registration Fee: CIAA/CICMA Members $215.00 Non-Members $245.00 Name:_____________________________________Company:_________________________________ Address: ____________________________________________________________________________ E-Mail:______________________________________________________________________________ Phone:____________________________
Affiliation: CICMA _____CIAA_______Other ________
Register early - Space is limited - Tickets will not be sold at the door. Register online at WWW.CIAA-ADJUSTERS.CA or return with Cheque payable to “CICMA/CIAA JOINT CONFERENCE” to: Louise Rivett, Integrated Insurance Resources, 5080 Timberlea Blvd., Suite 214, Mississauga, ON L4W 4M2 Enquiries: lrivett@integrated-ins.ca D: 905-247-1072
• spotlight S
Running past the finish line Dan Langer takes on CICMA presidency in retirement BY EMILY ATKINS
D
an Langer likes to run. He applies the energy he gains from being fit and fast to everything he does, including his role as president of the Canadian Insurance Claims Managers Association (CICMA), which he has taken on as a retirement project. Dan took a break from his marathon training (his next objective is the New Orleans marathon in March 2018) to chat about his role as president of CICMA, collaboration and where he sees claims in the future.
Background As with many of a certain age in the claims business, Dan took up adjusting not as part of a grand career plan. In his case it was more of an antidote to boredom, working in the banking industry. And it almost didn’t happen. He showed up for a job interview straight from the hockey arena where he was coaching 10-year-olds, wearing “sweatpants and a hockey jacket, with a whistle around my neck, and I’m thinking, ’this isn’t really going well’.” Nonetheless he landed the job and began his claims career in 1983 with Liberty Mutual in Toronto as an alllines adjuster. After a few years there he moved on to Prudential, taking a job as an examiner. A few years on he ended up back at Liberty when they bought Prudential’s book of business. His job as a supervisor entailed doing a fair bit of training adjusters, which ultimately landed him a job based in Boston. Starting in 1999 he relocated there, travelling around the US offering bodily injury training. After 18 months of being on the road two weeks out of four, he took a new job as an examiner, overseeing larger losses. He was responsible for three divisions, each with eight or nine offices. It was during his time in Boston that 12 Claims Canada
Winter 2017-18
he fell prey to the running bug. As the Boston Marathon went by one April, Dan says he “watched all these people go by, and just got completely inspired. There’s a saying in New England that there are more runners in New England the day after the Boston Marathon than any other time during the year.” But as with his start in claims running, too, almost didn’t work out. He gave up after three months due to sore knees. But, like clockwork, the marathon came by the following April and after being re-inspired he got a copy of Running for Dummies. He’s been pounding the pavement ever since. On his return from Boston to Toronto, when Meloche Monnex bought the personal lines business from Liberty Mutual, Dan switched to being a manager on the auto side, then bodily injury and finally in a national role. He retired from the company in January 2015, but since then has performed several claims-related contracts, helping out at a friend’s company in the Lindsay area. Although Dan is finished with his formal career, he is intent on maintaining his sanity and helping the industry through his association work. He became active in CICMA in late 2004 on his return from Boston. Subsequently, when the Ontario chapter was hosting the AGM, he was invited to work on the organizing committee, and never looked back. At first he was instrumental in updating the association’s website, and from there he was elected president for a two-year term. “It does take a level of commitment not just to the organization, but also to the industry,” he says. “I’ve been very fortunate to be able to work with some very dedicated and hard-working people through my tenure on the Ontario chapter.”
Objectives As president, Dan says that providing education and networking opportunities to the members is his primary goal. But he is also aware that, “One of the challenges that we have is maintaining a level of relevance to our members. What are we providing to our members to keep them coming in? In some ways, but not too overtly because we don’t want to scare off the existing membership, we are look ing at the next generation. How can we attract and retain the next level of claims leaders to come to the CICMA and see some value in that?” He believes there is still a “pervasive” belief that “to be a member of the CICMA you have to be a claims manager”. The problem is that in the current claims environment, “with mergers and acquisitions and the way companies are downsizing and reorganizing and growing and constricting, there are fewer and fewer titles of claims manager," he says. "There are still many, many people who are out there providing that function of managing claims and managing claims personnel or leading or guiding claims personnel, but their title isn’t claims manager.” The Ontario chapter has adopted a broader interpretation eligibility for membership in order to ensure continued relevance for the organization. As Dan points out, with the massive outflow of baby boomers from the industry, it will be increasingly important to adjust definitions in order to stay relevant. “In order to continue to make the organization a national organization, we’re going to have to move towards broadening that scope to include the claims leaders and have that more universal acceptance.” www.claimscanada.ca
Consequently, outlines are being drawn for the two organizations to work together, to offer “more of these sorts of joint conferences where we are able to perhaps have a bigger presentation, a bigger event, so we will not be competing against each other to roll out this topic to our constituencies, but rather trying to combine our resources to make these presentations.”
The business of claims
Dan Langer approaches the finish line at the 2013 Yellowknife Marathon.
Communications Continuing the theme of succession, Dan notes that in order to attract the younger generation, it’s important to “speak their language”. To that end he says the CICMA’s website is a priority. “We try to make it a valuable tool to communicate, but we’re also looking at expanding our presence in other social media areas,” he says. “We have to reach out to the next generation, in the environment where they’re comfortable. And it’s not a comfortable environment for us at this point, so we have to make sure that we’re able to get the right people in to help us with that and to move that way.” He notes that as a not-for-profit the association relies on the talents and energy of its volunteers, rather than on cash for social media consultants. “At the Ontario Chapter level we’ve got some bright, key people who have come on. That’s very encouraging,” he says, adding that there are several new national-level delegates who have come from the chapters. www.claimscanada.ca
“They are younger than I am, and they are much more capable of handling and working in those social media environments. So we are beginning to get some younger blood at the table with some fresher ideas. Their acceptance and willingness to champion these changes and take them back to their chapters is fantastic.”
Collaboration This interview, featuring CICMA’s president in the CIAA’s magazine, is just one example of the kind of interaction taking place between the associations. The CICMA/CIAA annual joint conference will be in its 51st year in 2018. “We’ve had a very good working relationship on that for the last 50 years,” Dan says. But he also notes that at a recent meeting of the two groups’ executives, someone pointed out that each group’s mandate of providing their constituency with educational value sometimes ends up with duplicated educational presentations. “As someone put it at the table, ’we’re stealing each others’ lunch’" he adds.
Another piece of the reason for Dan’s continuing involvement, past the normal retirement ’finish line’, is his ongoing concern for the industry and its future. He is particularly watching the continuing process of mergers and acquisitions narrowing the breadth of organizations in insurance. He notes the trend of large companies taking over insurance operations but coming from a different business background with the objective of bringing in processes and streamlining things that worked in other operations. “Claims departments have often been that red-headed stepchild in that fable, right? ’Everybody else brings in money, you cost us.’ Often when the company’s looking to cut expenses— and everybody’s looking to cut expenses—they cut in training, and they cut in claims. That, unfortunately means you’re cutting your service to your customers because if the people who answer the phone in the claims department don’t know how to deal with the person, can’t handle the claim, then you get a lot of dissatisfied customers, and then you won’t get brand loyalty,” he says. “Far too often companies fail to realize that the claims department is what they’re really selling. That’s the product. It’s not until their insureds have a claim where they need the claims department that they come to realize that.” “So I think insurance companies need to view claims a little bit differently and with more of an eye towards that human touch to claims. Instead of everything being process driven, but rather, the outcome being satisfactory for the policyholders.” • Winter 2017-18
Claims Canada 13
The second in our two-part series looking at structural problems in Ontario’s and BC’s auto insurance systems. Please turn to page 17 for an update on Ontario’s proposed auto insurance reforms.
Putting the brakes on
By Emily Atkins
BC’s auto insurance system is out of control
O
ut-of-control costs have pushed British Columbia’s government-run auto insurance provider to the brink of insolvency. A report commissioned by the BC government and published this July by EY looks at the causes and offers potential fixes, but so far, there has been little action. “Affordable and effective auto insurance – A new road forward for British Columbia” is the report resulting from the independent review commissioned for the Insurance Corporation of British Columbia (ICBC), a crown corporation. A little context All vehicles registered in BC must be insured under ICBC’s Basic insurance package (the Basic Autoplan), which offers protection from third-party legal liability, under-insured motorist protection, accident benefits, hit-and-run protection and inverse liability (coverage in parts of Canada or the US where local laws can affect a claim). ICBC, which was created in 1973 as the sole auto insurance provider, has been regulated by the BC Utilities Commission since 2003. BC’s litigation-based scheme allows not-at-fault drivers to sue those at fault for both pain and suffering and economic losses like lost wages, material damages and treatment costs. In the context of rising costs and concerns about affordability, every other jurisdiction in Canada has updated its auto insurance program some time in the past 20 years. BC is the only province that has not modified the adversarial model, the report notes. ICBC is not only responsible for insurance; the corporation also provides driver testing and licensing, registration and road safety services, as well as collecting unpaid fines and supporting the government’s access card program. ICBC’s insured vehicle owners subsidize these additional services.
Structural problems
According to the EY review, BC’s auto insurance scheme is suffering from significant problems. Premiums are high, but not high enough to cover the costs of the program. Without further government intervention – which has already protected consumers from 15 to 20 percent increases – the average BC driver will be facing an annual premium of close to $2,000 in 2019, an estimated 30 percent rate bump, EY says. Five main factors are contributing to the problem: • The number of accidents on BC roads increased 23 percent between 2013 and 2016. That’s 20,000 additional crashes each year. As well, repair costs have increased by more than 30 percent in the past two years, largely thanks to the increasing complexity of modern cars. In the past four years the number of cars over $150,000 MSRP in BC has increased 70 percent. • The number of injury claims is increasing faster than the number of crashes. • The average settlement for minor injuries is climbing, and these are driving new accident claims. In 2000 the average minor injury claim paid out $8,200. In 2016 that average had climbed to more than $30,000. • Claim costs for minor injuries have increased to nearly 60 percent of total bodily injury claims. In 2000 minor injuries accounted for only 30 percent of injury claim costs. In 2016 minor injuries cost $995 million, while major injuries cost $715m. • Rising costs are pushing premiums to an unaffordable level. Breakdown of Costs (claims and expenses) for Basic Product Legal costs 24% Commissions 3% ICBC Operating expenses 15%
Legal & operating expenses 42%
Claimant benefits - Bodily injury minor injuries 20%
hart 2 below shows the breakdown of costs and expenses in 2016 incurred against BC’s Basic surance product. Of note, minor injuries account for more annual cost than seriousClaimant or catastrophic Benefits Claimant benefits - Bodilycosts. injury non-injuries 17% juries, and legal costs are higher than either of these 58%
Claimant benefits - Accident benefits 6% hart 2: Breakdown of costs and expenses Claimant benefits - Property damage 14%
•
Minor injuries account for 20% of total annual cost, while serious and catastrophic injuries Policy year 2016minor soft-tissue injury costs are only account for less at 17%. In most other jurisdictions, Note: IBC operating expenses for Basic product compare favourably to the about half of more serious or catastrophic injuries.
•
Legal costs account for 24% of total annual costs, greater than the cost to run ICBC and from “Affordable and or effective auto insurance – A new road benefits receivedAdapted by either minor injuries non-minor injuries.
national average of Canadian property and casualty insurers
forward for British Columbia”, 2017, EY.
“Premiums collected by ICBC today are the second highest in Canada, yet they are not high enough to cover the cost of paying claims,” the report says. There is currently a gap of $560m between premium revenues and claims costs. The gap is expected to balloon to $1.1 billion a year in the space of the next 18 months if not addressed.
Reform required Clearly, BC’s auto insurance system is in trouble. The EY report bluntly states: “There is no indication that the underlying issues will correct themselves.” Its prescription is major reform arranged around three sets of priority initiatives. First, EY suggests that road safety needs to be highlighted. Changing high-risk driver behaviour will reduce crashes and
www.claimscanada.ca
ote: ICBC operating expenses for Basic product compare favourably to the national average of Canadian property and sualty insurers
claims. Second, the insurance product needs to be redesigned. Third, additional measures such as process improvements need to be brought in on an interim basis to establish a foundation for reform. The report estimates that near-term process improvements could generate as much as $150m in savings and revenue, while road safety initiatives could net $250m in savings by 2021. That would still leave a sizeable deficit in the context of the projected $1.1b gap.
Tweaking the system The report notes that speeding, distracted driving and impaired driving accounted for more than 84 percent of road fatalities in BC in 2015. Road safety initiatives would target these, with increased enforcement working alongside improved technological solutions. In advocating implementing best practices from global safety leaders, the report also notes, “in order to make sustainable changes in driver behavior, the three pillars of education, enforcement and driver penalties must be aligned.” Since 2012 ICBC has been implementing process improvement measures in areas such as claims management and handling. It introduced a quality assurance and fraud mitigation program and has reduced management costs and operating budgets. EY singled out two of the claims management initiatives already underway as areas for potential future savings gains. Extension of the quality assurance and fraud mitigation programs can generate $30m to $60m in annual savings. But these are not enough. In the report, EY advocates updating ICBC’s risk model to better reflect drivers’ choices and behaviours. No updates have been applied to the rate design framework since 2007, resulting in an imbalance in the way rates are calculated. EY wants ICBC “to change its pricing and risk model to clearly identify and penalize higher-risk drivers and conversely improve the reward system for those who drive safely.” EY estimates that this could net up to $80m in new revenue every year. The administration of road safety initiatives is another place EY believes there is room for improvement. It suggests ICBC should keep at least some of the revenues generated through increased enforcement, while in the past this had been spread among various government entities. Along the same lines, EY suggests the BC government should reconsider ICBC’s regulation by the BC Utilities Commission. The utility model, it says, was not designed to regulate insurance, and the “future requirements of the organization will require a less expensive and less bureaucratic approach to competitive pricing with an enhanced ability to respond to customer requirements and changing market conditions.” As well, if some of the additional recommendations for changes to the insurance product itself are implemented, a new independent regulatory framework will be required.
A major overhaul According to the report, rescuing ICBC’s insurance programs requires an overhaul of the basic product. The report offers solutions across a continuum of models, from the existing litigation-based system now in use, through hybrid models that cap benefits, and on to comprehensive care models that deliver treatment rather than awards. It goes without saying the current model is not one of the choices EY promotes. It’s seen as highly inefficient, with only 58
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Claims Canada 15
percent of premiums being returned to claimants, not to mention long wait times for resolution due to legal processes. And, as noted above, without changes, this model will result in premiums escalating to almost $2,000 a year to cover costs. As alternatives, EY proposes four scenarios for 2019 with savings in the range of $770m to $1.43b per year. The first introduces caps on pain and suffering, doubles accident benefits, and limits medical payments to $300,000. Based on models in Alberta and New Brunswick, it would net savings of $770m, with an average premium of $1,590. The second concept is based on offerings in New South Wales and Queensland, Australia. It caps pain and suffering, triples accident benefits, and limits medical payments to $450,000. It introduces stronger rules for litigated claims and adds an independent dispute resolution process. It would save $840m, with a premium of $1,510. In the third model, pain and suffering benefits are capped, accident benefits are quadrupled, and medical payments top out at $600,000. In addition to the stronger rules and dispute resolution process added above, medical and rehab costs would be paid only as benefits, not as a lump sum. The savings from this program, inspired by the one in Victoria, Australia, would be $875m, with an average premium of $1,470. The final model shifts to comprehensive care, enriching benefits without recourse to litigation, eliminating pain and suffering benefits, and enabling the right to sue only in cases of criminal negligence. This is similar to programs in Saskatchewan and
Manitoba. Savings would be $1.43b with annual premiums of $1,340. EY points out changes “must be undertaken in order to materially impact claims costs and assist with achieving financial sustainability without requiring significant premium increases. However, these changes are not quick fixes – they will require thoughtful design and consultation with many stakeholders, as well as legislative changes. The financial benefits would not be realized until implementation is complete in 18 to 24 months.”
It’s political That means 18 to 24 months from the time the safety and program change measures are implemented. But with a change of government having taken place in BC after the report was commissioned, no action has been taken to implement proposed reforms. The office of BC’s attorney general recently acknowledged that ICBC is experiencing a financial crisis and that change is required, but the government has not yet indicated whether, or when, it will adopt the EY report’s recommendations. Meanwhile, opposition parties and special interest groups are taking aim. “ICBC has turned into a train wreck and a national embarrassment,” Scott Anderson, interim leader of the BC Conservatives said in November. “Competition must be opened up to private companies for basic insurance in order to reduce insurance rates for everyone. It is completely unacceptable that BC drivers now pay the highest insurance premiums in Canada,” he concluded.
Ontario moves on Marshall recommendations Anderson aligned the party with the Canadian Taxpayers’ Federation (CTF), which released a report in August called “Political risk: The case for ending ICBC’s insurance monopoly”, written by independent policy analyst Mark Milke. “The best auto insurance option for British Columbians is wide-open competition,” Milke said in a CTF statement. “Government monopolies made no sense in the 1970s and make even less sense in the age of the Internet and easily obtained competing quotes.” “When governments interfere in insurance markets, in the policy that should result from actuarial calculations, governments subvert the sound basis for such risk management,” Milke wrote. He advocates turning ICBC into a co-op along the lines of MEC (outdoor gear retailer Mountain Equipment Co-Op). “So long as it involves full competition from the private sector [it]…would increase choice, service and price possibilities for consumers. It might also be the most politically attractive option: It combines the usefulness of competition with a co-operative model already known by many British Columbians.” “We need to look at real reforms to our auto insurance system in BC, otherwise drivers will continue to get gouged by a politically-manipulated monopoly,” CTF’s BC director Kris Sims noted in a press release. “Limiting payouts to injured British Columbians and hitting them with photo radar are terrible options. Let’s break the monopoly and let competition help keep rates in check.” •
By Emily Atkins
In our last issue we looked at Ontario’s Marshall Report, “Fair Benefits, Fairly Delivered” (“Looking under the hood – Ontario’s mandatory auto insurance system needs more than a tune-up”, October/November 2017, page 12). In it David Marshall made extensive recommendations designed to address the fact that Ontario has the lowest accident rates in Canada, yet its drivers pay the highest premiums. His proposals were designed to meet five goals: Provide a safety net for the injured; make benefits easy to understand; make benefits easy to access without the need for legal assistance; make premiums affordable; and, ensure the system is adaptable. On December 5th the Ontario government announced it is “moving forward with significant structural reforms” to address some of the issues Marshall raised in his report. In announcing Ontario’s “Fair Auto Insurance Plan”, finance minister Charles Sousa said the reforms introduced over the years to reduce insurance costs “don’t go far enough”, and based on Marshall’s recommendations, the province aims to “to help victims, tackle fraud and further reduce premium costs.”
The Plan The initiatives introduced under the plan are as follows: Standard treatment plans will be developed by Spring 2018. These plans will focus on making sure people with the most common collision injuries, such as sprains, strains and ...continued on page 18
...continued from page 17
whiplash, receive timely, appropriate and effective treatment. According to the government’s backgrounder on the new plan, the treatment plans will focus on “recovery, monitoring health outcomes and increasing awareness of the best treatment practices” with the objective of ensuring patients get the care they need. In alignment with Marshall’s observations, the government says treatment plans will help to reduce costs by changing the focus from cash payouts to ensuring accident victims get appropriate care. Independent examination centres will be established to assess more serious injuries. This will help “resolve and reduce” disputes between insurers and accident victims over competing diagnoses, as well as helping to reduce the costs associated with resolving those disputes. The independent examination centres will work to develop standards for assessors in order to ensure that neutral assessments are respected. A Serious Fraud Office will be established in Spring 2018. Staffed jointly by representatives from the Ontario Provincial Police and the Ministry of the Attorney General, the office will “combat serious fraud, with a focus on auto insurance fraud, which has been identified as one of the factors contributing to higher premiums.” The province’s Financial Services Commission will review the risk factors used to calculate premiums. This review will take place by Spring 2018. The goal is to ensure drivers in certain parts of the province are not paying unfairly high rates. In cooperation with the Law Society of Upper Canada, the province will ensure that lawyers’ contingency fees are fair, reasonable and more transparent. “We are working with the Law Society to increase access to justice, and protect accident victims from unscrupulous practices and unreasonable fees,” said attorney general Yasir Naqvi. “This is critical to protecting consumers and another step to building a more accessible and fair justice system for Ontarians.” The province wants to protect people who need legal and paralegal services – especially those who are vulnerable, like accident victims – and ensure they understand the agreements they are entering into. As well, the Law Society has approved the changes to: Introduce a mandatory standard contingency fee agreement; create a ‘Know Your Rights’ guide for the public, which contains information on consumer rights in relation to contingency fee agreements; require legal professionals to publicly disclose the maximum contingency fee percentage they charge by practice area; and, require lawyers and paralegals to report annually on their contingency fee practices. Amendments to the auto insurance act will be introduced with the goal of modernizing the auto insurance rate approval process, reducing red tape and strengthening consumer protection. As planned, the amendments would give the Financial Services Regulatory Authority (FSRA) of Ontario authority to establish rules, “enabling it to promptly and effectively respond to insurance market trends, facilitating industry innovation to benefit consumers.” Finally, the government plans to establish a panel of five experts who will advise on enacting the reforms, consulting with stakeholders including drivers, insurers, health service providers and legal service providers. The panel will be appointed by the Minister of Finance early in the new year.
Mixed reaction As with Marshall’s report, reaction to the government plan has been mixed. On the positive side, the Insurance Bureau of Canada (IBC) said it is looking forward to working with the FSRA in its role as the new regulator. “A proactive, innovative regulator will champion achievement of long-term change leading to sustainable improvement in rates for Ontario drivers,” said Kim Donaldson, IBC’s vice-president, Ontario. “Comprehensive structural change is the
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only way to lower the cost of auto insurance for consumers. Ontario’s property and casualty insurers will continue to be an active partner, along with other stakeholders, to help make this system better for all Ontarians.” The Insurance Brokers Association Ontario (IBAO) supports the plan but cautions the government to take care on its implementation. The IBAO urges a measured approach on the risk factor review and the transition to FSRA. The association is concerned about disruption that might be created by rate changes. “Insurance brokers, who represent over six million policyholders in Ontario, encourage stabilizing auto insurance rates so they can provide affordable coverage that’s balanced with the necessary benefits and consumer protections,” said Colin Simpson, CEO of the IBAO. The brokers also noted that they have, in the past, championed the limitation of referral fees, previously calling for transparency in all legal costs surrounding auto insurance. “Prescribing a consumer-friendly and publicly available fee disclosure report should be required by all legal actors in order to protect the interests of the consumer,” the association said in a statement. Legal professionals are viewing some parts of the plan with skepticism as well. “The proposed “Independent Examination Centres” (IECs) are essentially “DACs Round 2”, David Raposo, chair of the Accident Benefits Committee of CDL and a partner at Dutton Brock in Toronto told Claims Canada. “The problem with the previous Designated Assessment Centres (DAC) system was the perception that they were biased because the assessments were funded by insurers. The government has already suggested the IECs will also be funded by insurers. For the IECs to work and be respected by all parties there must be a transparent method of selecting qualified doctors and there must be real quality control,” he added. Raposo also said assessors must have more clinical experience than the three years of experience required in the old system: “The government has not released any details on how assessors are to be chosen, funded and at what cost – ie. are the assessments going to continue to capped at $2,000 per assessment or will it be a higher (or lower) cap per assessment? To avoid the perception that this proposed system is going to be similar to the DAC system the reports must be considered to have greater weight than they did in the DAC system, or even be considered final with some right of appeal.” Other opinion suggests the plan and its timing are politically motivated. With a provincial election looming in June 2018, some believe that the Kathleen Wynne Liberals are pushing the plan with vague deadlines of “Spring 2018” as a means to pacify Ontario voters. Raposo believes “the timing does likely mean this will be an election issue for the government. I understand the government is assembling a five-person consultation panel of experts to make recommendations. Those recommendations will likely be shared with stakeholders and once decisions are made as to how it is going to work the government will need to implement then same with legislation. All of this is unlikely to occur prior to the election in June, 2018.” Likewise, the Chatham Daily News asked in an editorial on December 7: “The Wynne government is promising to have some of these measures underway by spring, but who’s to say that following the June 2018 election, they won’t be dismissed as “stretch goals” by Wynne if she’s re-elected?” For its part the government is vague about implementation. In an email, Scott Blodgett, a spokesman for the Ontario Ministry of Finance, said only that the advisory panel will be established early in the new year, and will “inform the need for any legislative amendments. It will help the government identify the challenges and opportunities associated with potential approaches to implement the reforms.” Timelines for the remaining pieces of the proposal have not been made public. • www.claimscanada.
Insurance implications of marijuana legalization BY JENNIFER HUNEAULT AND JASON ARCURI
With legalization of recreational marijuana use slated to take effect in Canada on July 1, 2018, challenge and change is on the horizon. But with change also comes great opportunity, not only for businesses and industries directly involved in the production and distribution of marijuana, but also in ancillary markets, including the insurance industry. Bill C-45, the regulatory framework for recreational marijuana in Canada, not only decriminalizes the possession of less than 30 grams for those over 18, but it also permits adults to grow up to four marijuana plants per household. Moreover, it establishes a licensing framework for the importation, exportation, production, testing, packaging, labelling, sending, delivery, transportation, sale, possession and disposal of cannabis. Bill C-46, a companion bill, establishes three new drug-impaired driving offences. So what will the potential economic impact of legal marijuana be in Canada? According to a 2016 report prepared by Deloitte, entitled “Recreational Marijuana: Insights and Opportunities”, legal consumption, as well as ancillary markets related to security, testing, transportation, tourism, taxation, and paraphernalia, could generate $22.6 billion in revenue per year. Sales alone could reach $8.7 billion annually, which is similar to sales numbers generated by wine. While the effects of marijuana legalization may take years to be fully appreciated, there are a number of immediate policy-related implications the insurance industry should be considering in preparation for legalization. www.claimscanada.ca
Homeowner policies In the context of claims made under a homeowner’s policy of insurance, consideration needs to be given to both claims related to property damage, and claims for theft, or damage to marijuana plants. For property damage claims, personal cultivation of marijuana introduces a peril that is currently excluded in a standard homeowner insurance policy. Current standard policy wording includes exclusions for indirect or direct loss or damage to a dwelling used in the processing or manufacturing of marijuana. These provisions will require amendment. Moreover, insurers should consider amendments to specifically address how they intend to treat marijuana plants for the purpose of theft or damage claims. Will marijuana plants be considered to be personal property, or will claims for plant theft and damage fall under the “tree, shrub and plant” portions of the policy, which generally include a maximum payout per loss? Proactively clarifying these portions of policy wording will assist in the claims process in the future. Additionally, in-home marijuana production comes with inherent risk, which could result in increased water, mould, and fire damage claims. Legislative change will bring the process into the legal framework, which in turn will provide insurers with the ability to openly provide coverage for personal cultivation, while charging premiums reflective of the risk. The proactive development of industry-wide standards and safety controls can also assist in managing risks, and reducing claims. Auto policies A 2014 Centre for Addiction and Mental Health policy paper: "Cannabis Policy Framework", suggests that nine percent of licensed drivers in Ontario, aged 18 to 29, report having driven
within an hour of using marijuana. In randomly screened Ontario drivers, 10.2 percent tested positive for at least one drug other than alcohol, with 43.6 percent testing positive for marijuana. With this backdrop, it is not an over-reaction to speculate that marijuana legalization, in conjunction with newly established impaired driving offences, may result in an increase in impairment cases. Problems with determining “impairment” aside, an increase in claims could, in the Ontario context, result in increased exposure for insurers under the OPCF 44 provisions of an auto policy, namely under the “underinsured” motorist provisions. Pursuant to section 7.2.2 of the Ontario Automobile Policy (OAP1), coverage for accidental loss or damage caused by a driver under the influence of “intoxicating substances” is excluded. Insurers will be in a position to restrict the liability limits available under the at-fault motorist’s policy to $200,000, the statutory minimum limits. However, the resultant effect is that injured plaintiffs will shift to seeking compensation from their own insurer, under the terms of their own policy. In the accident benefits context, currently entitlement to income replacement benefits, non-earner benefits, and other expenses is excluded under section 4.4 of the OAP1 where a claimant is convicted of a criminal offence involving the operation of an automobile. These provisions will also require review. Outside of implications on current coverage and policy, the legalization of recreational marijuana can also result in business opportunities for insurers, through the creation of new and emerging areas of coverage and product offerings.
Commercial cultivation On the mass production front, there are currently 71 Licensed Producers (LP) Winter 2017-18
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(operating 74 sites) that are licensed by Health Canada to legally sell, distribute and grow medical marijuana. From an insurance perspective, LPs are not particularly different from other commercial ventures. Their processes are strictly regulated by Health Canada, and they are subject to regular inspection. A stringent regulatory framework has resulted in managed and significantly reduced associated risks. LPs require specialized property and equipment coverage, along with a specialized insurance product that will cover, as stock, both living plant material, and finished products ready for sale. Other areas of coverage that may be offered to LPs include product liability coverage, business interruption coverage, and Director and Officers’ liability insurance. Once marijuana is cultivated and harvested, its transportation will create potential for loss exposure, and another area for insurer business growth. Currently, medical marijuana is transported
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directly from an LP to the end user by Canada Post, or private courier companies. As per Health Canada regulations, LPs may ship a 30 days supply, or, 150 grams of marijuana at a time. In anticipation of the July 1, 2018 legalization deadline, the Government of Ontario announced on September 8, 2017 that marijuana will be sold in 150 provincially licensed outlets, with 40 dedicated retail locations opening in July 2018, in addition to a provincially run e-commerce website. Supply of a large retail chain, under the management of the Liquor Control Board of Ontario (LCBO) will require product to be transported in bulk, creating an increased potential risk of theft and damage to product while in transit. This model of retail distribution will create an ancillary need for specialized cargo coverage. Finally, the creation of a new legal marijuana retail market creates opportunity for insurers to offer cyber insurance coverage for data breaches involving the exposure of
individual private information to criminal elements by way of cyber breaches. The legalization of marijuana in Canada will bring with it challenges, changes, and opportunities for business, and the insurance industry alike. With the advent of new markets to insure—from licensed producers to ancillary markets—along with the potential implications for personal insurance lines, cyber insurance and trucking, legalization provides an opportunity for professionals in the insurance industry to pioneer new products and coverages. In preparation for legalization, insurers need to get ahead of the risk by reviewing policies and language, and by developing their strategic response on how they will respond to the market. With measured and principled preparation, legalization will afford immense opportunity as the “green rush” takes the country by storm. • Jennifer Huneault and Jason Arcuri are both partners with Hughes Amys LLP.
www.claimscanada.ca
Fentanyl – What you need to know if you encounter it
Synapse
BY MIKE WIEBE
What is fentanyl? Fentany is a powerful synthetic opioid analgesic that is similar to morphine but is 50 to 100 times more toxic. When used legitimately, it is a Schedule II prescription drug and it is typically used to treat patients with severe pain or to manage pain after surgery. It is also sometimes used to treat patients with chronic pain who are physically tolerant to other opioids. In its prescription form, fentanyl is known by such names as Actiq, Duragesic, and Sublimaze. Street names for fentanyl or for fentanyl-laced heroin include Apache, China Girl, China White, Dance Fever, Friend, Goodfella, Jackpot, Murder 8, TNT, and Tango & Cash. The illustration above shows how some nerves make opioids (endorphins) send a signal to other nerves. Narcotics (exogenous opiates) mimic this signal, turning down the activity of a nerve involved in sensing pain. Naloxone (Narcan) is a short-acting drug, which will bring a patient out of an opiate overdose by stripping the opiate from the opiate receptor. It is a lifesaving drug. Naltrexone, a short acting opiate/alcohol blocking agent has been used for the last 30 years. All narcotics work basically the same way fentanyl works, by binding to the body's opioid receptors, which are found in areas of the brain that control pain and emotions. When opioid drugs bind to these receptors, they can drive up dopamine levels in the brain's reward areas, producing a state of euphoria and relaxation. So what’s the difference between morphine and fentanyl? The major www.claimscanada.ca
Target Neuron
E
Signaling Neuron
C
signal
D
signal
B Alcohol A = Naltrexone
= Endogenous Opioids
= Receptor
= Exogenous Opiates
differences relate to how the drug is handled by the body. Fentanyl attaches much more tightly to the opiate receptors than morphine, so you need much less drug to ease the same amount of pain (in fact, fentanyl is about 100 times more potent than morphine). But fentanyl doesn’t last as long in the body. A dose of morphine can kill pain for four to six hours, compared to only an hour or so for a single dose of intravenous fentanyl.
Origin and Production Fentanyl is mainly produced by chemists in China. It is shipped in bricks, or kilos. One kilo of fentanyl, when cut at a ratio of one part fentanyl to 100 parts filler (such as caffeine), will produce approximately a million pills. There are estimated to be 1,400 analogs of fentanyl with only 200-plus that have
been synthesized and studied. It is odourless and tasteless and therefore hard to detect. In one study, the “NIK” (Narcotic Identification Kits) correctly identified fentanyl in only two out of 10 cases. An ion scanner, when correctly set up, will identify fentanyl and various analogs of fentanyl 99.97 percent of the time.
Cross-contamination One of the most dangerous things about fentanyl (or any drug or bio hazard) is cross-contamination. In a fentanyl remediation we conducted earlier this year, the drug producer living in the two-bedroom apartment had been walking in and out of the unit, contaminating the hallways, the elevators and other common areas of the building. In this particular case, fentanyl (and carfentanyl) had been cut with caffeine and was being placed in capsules instead of pressing it into pills. Fentanyl powder and residue was extensive throughout the kitchen and living room as well as the bedroom, where the producer had been using and ultimately overdosed and died. After the apartment was secured and locks changed, we received the call to assess the situation. We were immediately concerned about the traffic area between his fourth floor apartment and the foyer and entrance on the main floor. This had all been contaminated Winter 2017-18
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by footwear used in the apartment. We had to decontaminate the entire hallway, the elevator, both stairwells leading to the main foyer, as well as the hallways from the elevator and stairwells to the foyer. This was completed in a threestep process with a commercial extractor using our bio-wash solution as the encapsulating agent. The contaminated solution is contained and later discarded at the biohazard waste area designated at the municipal waste management station. Now we could set up our zones in the hallway and apartment: red for the
If you’re in Manitoba, this is considered an automobile. Surprised? ARC isn’t.
Your customer has a list of the vehicles that are covered by your fleet policy. You have a list of the vehicles that are covered by ARC Group Canada is a national that policy. network of independent law firms, And your lists aren’t theintimately same. each connected to their local market. When the one vehicle that is involved in Insurance risk appear management an accident is the one thatand doesn’t on experts. Regionalnext? strength. both lists, do you know what happens National scope. ARC does. That is the ARC Group.
dent Law Firms
If you’re in Manitoba, this is considered an automobile.
That is the ARC Group. Education and awareness Go to AskARC.com The key to ensuring safety in our communities is awareness education. FenGo to AskARC.com tanyl drug labs are increasing in Canada, and they have been found just about anywhere—in rented homes and apartments, motel rooms, rental vehicles, abandoned buildings, barns and garden sheds. Everyone should be alert for signs of a potential fentanyl drug lab operation, including: an unusual amount of white or coloured powder on walls or floors; unusual thumping sounds that could indicate a pill press machine; chemical odours—often a strong vinegar smell; ARC Group Canada is a national network of independent law firms, each intimately connected to their local market. tenants reluctant to allow landlords to inspect the property; payment of rent Insurance and risk management experts. Regional strength. National scope. Go to AskARC.com in cash; surveillance cameras; curtains always drawn and exhaust fans running at odd times. Residents may wear filtration masks, safety glasses or other proThe ARC Legal Reporter tective equipment, commenting that Winter Issue – Article they are#1 “painting”. A National Network of Independent Law Firms If you suspect a clandestine fentanyl lab operation, leave the area immediWhen is a medical examination considered a second examination ately. Do not investigate. Do not enter the under Rule 36 of the New Brunswick Rules of Court? premises. Contact your local police. • The ARC Legal Reporter Mike Wiebe is Partner & General Blyth v. Crowther and Kelly Case: Winter IssueReported – Article #1 2009 NBCA 80 Citation: Manager of Trauma Scene Bio Services. When both the plaintiff’s physical and mental condition are in issue in an action, and At Issue:
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al examination considered a second examination e 36 of the New Brunswick Rules of The Court? Court: ARC_Fleet ad_1/2 page.indd 1
v. Crowther and Kelly
dry, using an ion scanner that had been programmed for five to seven different analogs of fentanyl. After spraying the fentanyl with our encapsulating solution and wiping only once with our biohazard wipes, the ion scanner reported a 99.997 percent loss of detection. The ion scanner will measure down to the nanogram. The fact that we bio-wash all contaminated hard surfaces with solution twice and once with a clean rinse wipe, clearly indicates the elimination of any fentanyl presence after our remediation process is complete. Fentanyl remediation is a process foreign to restoration companies. Trauma Scene Bio Services specializes in only trauma and crime scene biohazards,Surprised? which includes ARCdrug isn’t.labs, and fentanyl. Based on this two-bedroom decontamination, our fentanyl remediation process has been examined and ARC approved Group Canada a national by is Alberta Health Services. network of independent law firms, Their results stated that our process each intimately connected to went above theirand localbeyond market. their expectations. As a result, they will be using our Insurance and risk management remediation process as a guideline and experts. Regional strength. National scope. precedent going forward.
contaminated area, yellow for the transitional area and green for the decontaminated area. The PPE (personal protective equipment) required for such a decontamination process must be very thorough—from booties, Tyvek suits, double nitrile gloves, full-face respirators, and wrists and ankles duct-taped to prevent outside contaminants from entering. The hazard assessment completed, now the remediation of the contaminated apartment began. The encapsulating solution we use was tested on actual fentanyl, wet and
Judgment Rendered: Factual Summary:
the plaintiff undergoes a physical examination, will a subsequent application for a psychiatric examination be considered an application for a second medical examination? Should medical examinations that are ordered as part of the discovery process be characterized as ‘independent’ medical examinations? Court of Appeal of New Brunswick October 13, 2009 (Reasons delivered November 2015-02-14 26, 2009) 1:05 PM The plaintiff suffered injuries in a motor vehicle accident and commenced an action seeking damages. Both the plaintiff’s physical state and mental state were in issue in
www.claimscanada.ca
New data requirements will make cyber coverage mandatory
BY HEATHER A. SANDERSON
Enacted by the European Parliament to simplify business rules for companies operating in the EU market and to strengthen the privacy rights of EU citizens, the General Data Protection Regulation (GDPR) comes into effect May 25, 2018. When it comes into effect, Canadian businesses with a presence in an EU country, or that offer goods and services to an EU resident, or monitor the behavior of an EU citizen, will be subject to the GDPR. It extensively regulates the ability of Canadian businesses to use the information they collect from EU citizens. There is unlikely to be grace period. This will mark the beginning of a new global era in data protection. The GDPR will effectively bar entities from the EU if they do not comply with its requirements. If they want entry to the lucrative European market they will have to adapt. Economic—not legislative—pressure means the GDPR is a world-wide game changer that will impact all aspects of global data protection and management. The GDPR compels compliance through grossly punitive sanctions. A serious failure to comply could result in a penalty of 20 million Euros or four percent of the corporate group’s annual worldwide revenue. Sanctions for a less serious compliance failure are half those amounts. If that is not enough, public interest organizations may bring class actions on behalf of those whose rights have been allegedly violated. No business can absorb these penalties. www.claimscanada.ca
Canada’s ‘adequacy’ status is in jeopardy Canadian companies that comply with the current version of PIPEDA (Canada’s Personal Information Protection and Electronic Documents Act) meet the current EU standards for data protection and are deemed to be ‘adequate’. ‘Adequacy status’ means that Canadian PIPEDA-compliant entities can receive data transfers from the EU without concern that they are violating EU data protection legislation and privacy laws, and without any further requirements. However, that level of adequacy may not continue when the GDPR comes into effect, thanks to these changes: • The consent requirement: Data processing must be “lawful” and requires that consent to process personal data must be freely given by the EU citizen in issue; the request for consent must be clear and distinguishable from other matters, provided in an intelligible, plain language and easily accessible form. Moreover, it must be as easy for the EU citizen to withdraw consent as it is to give it. • Rights of Rectification and Erasure (or the right to be forgotten): The data of an EU citizen must be accessible; that citizen has the right to rectify it. Further, entities receiving the data must permanently erase it without ‘undue delay’ if it is no longer needed; or the EU citizen objects to its retention; or it was unlawfully processed. • Conduct Data Protection Impact Assessments: The entity receiving the data must routinely assess how the party delivering the data would be impacted in the event that the data is lost or diverted. • Breach Notification: Under the GDPR, breach notification will become mandatory where a data breach is likely to “result in a risk for the rights and freedoms of individuals” and must be done within 72 hours of first having become aware of the breach. Entities holding the data will also be required to notify the affected individuals, “without undue delay” after first becoming aware of a data breach. The ability to receive data from the
EU enables Canadian businesses to participate in a market of more than 50 million individuals—a critical economic advantage. In September 2017, in an effort to enable Canadian business to continue to operate under ‘an adequacy’ umbrella, the federal government proposed amendments to modernize PIPEDA and, in part, bring it into line with most of the changes under the GDPR. The amendments specify content requirements for reporting data breaches to the Privacy Commissioner and notifying those affected, while clarifying the scope and retention period for record-keeping. However, the amendments do not address all of the GDPR requirements. For example, the key GDPR issue of consent is currently the subject of debate in Canada and it is not part of the package of amendments to PIPEDA. Further, the amendments do not address the requirement to conduct data protection impact assessments nor do they address the right to rectify and to be forgotten. This means that the European Court of Justice will be able to re-evaluate Canada’s current ‘adequacy’ status. However, PIPEDA is not the only dataprotection statute in Canada. British Columbia, Alberta and Quebec have their own statutes that are substantially similar to PIPEDA. So, even if PIPEDA is deemed inadequate, it is possible for the European Court of Justice to declare that one of the provinces meets the adequacy standard. The threat to ‘adequacy’ means that Canadian entities doing business in the EU must retain counsel to carefully review their data collection and handling practices to ensure GDPR compliance and avoid sanctions.
A code of conduct The European Commission has drafted model clauses to be inserted into commercial agreements to force contractual compliance with the GDPR. This will allow Canadian entities to enter and compete in the EU market even if Canada loses its adequacy standard. These clauses will contractually bind Canadian entities to the same standard Winter 2017-18
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of data protection and European privacy law as set out in the GDPR. They also render Canadian entities liable to be audited by the party transferring the data. In view of the uncertainty as to ‘adequacy’, voluntary assumption of the GDPR standards of data protection is the best defence against draconian enforcement.
Cyber to be common coverage The risk of non-compliance with the GDPR standards, coupled with the exacting nature of a breach response, increases the risk of business failure following a breach. In the event of a data breach, or an allegation of mismanagement of data, management will be reaching for the protection of any available policy. Most modern property policies and general liability policies exclude the risks associated with allegedly improper data protection and management. The exceptions are some types of first-party crime coverage and, in the third-party coverage arena, errors and omissions coverage, as well as directors’ and of-
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ficers’ coverage. For the most part, any real protection against these risks will be found, if at all, in first- and third-party cyber coverage. Most first-party cyber coverage extends to the loss of company information held by a vendor; coverage for cyber extortion payments; losses generated by social engineering such as phishing attacks resulting in improper transfers of funds; and data replacement costs. Most policies offer some degree of business interruption and extra expense coverage for disruptions due to dealing with a breach. Further, cyber insurance policies often include a service element resulting in the availability of pre-approved incident response specialists, including lawyers and forensic experts whose fees are paid by the insurer. Other cyber policies require the insured to appoint appropriate vendors, but the insurer will provide indemnity for such services. However, few policies cover ‘breachless’ claims—in other words, few policies cover consumer class-action claims
where it is alleged that the entity in issue collected data that it had no right to obtain, sold it, or otherwise ‘mined’ it without consent. Consequently, allegedly wrongful collection practices and, for example, violation of the GDPR’s right to rectify data, may not be risks easily covered under existing cyber policies. Despite the limitations of coverage, the catastrophic financial risks that are likely to follow a failure to comply with GDPR standards mean that over the next year or two, cyber policies will become as common as commercial property and liability policies are now. • Heather Sanderson, a member of the Alberta Bar, is a nationally recognized coverage lawyer and author who provides coverage litigation services, opinions and support to Canadian and American insurers. She is a director of Canadian Defence Lawyers and the Defense Research Institute, a member of the Federation of Defense and Corporate Counsel, and the American College of Coverage and Extra-Contractual Counsel.
www.claimscanada.ca
Lessons from the field in Fort Mac BY KRIS RZESNOSKI
On May 3, 2016 a massive wildfire swept through the remote Alberta community of Fort McMurray, necessitating the largest wildfire evacuation in Canadian history, with upwards of 88,000 people fleeing their homes. May 3rd was a turning point as well for Encircle. We offer all parties in the underwriting and claims process automation tools that allow them to collect, collaborate, and share data in real-time. We had just completed our catastrophe claim process mapping that allowed carriers and contractors to operate in Cats with the exact same field process used in their day-to-day handling of claims. All field trials were positive and efficiency gains were testing high. We were confident that we could enter losses with one process that was so efficient that it could handle the massive surge of a Cat event creating unprecedented efficiency and savings of time. As it would turn out, Fort Mac was an unprecedented Cat in Canada with 2,400 homes and buildings burned causing a loss of nearly $3.68B. There were 27,000 personal property claims averaging $81,000, 5,000 commercial claims averaging more than $250,000, and 12,000 auto claims averaging $15,000. This was going to be a challenge for the entire industry and an opportunity for us to test our new technology in the real world. Not satisfied to just sit back and see what would happen, we decided to put boots on the ground to ensure we could deliver on the promise of ease of use and efficiency. Here we want to share the knowledge and understanding we gained from working with our fellow restoration contractors in the field.
Lesson 1: Manual systems
create massive inefficiencies As the volume of claims begins to escalate for carriers, independent adjusters or contractors, manual systems can take anywww.claimscanada.ca
where from 30 minutes to an hour to set up and transfer claims. Redundancy between the different parties leads to unnecessarily long cycle times and inefficiency. A common workflow we saw in Fort Mac was manual file creation that was transferred to the field teams the next day, and information being written down on paper at the site and entered at night in the camps. These processes added at least one to two hours of additional work per claim and extended cycle time. When the field reports were finally submitted, many contained missing information, inaccuracies and inconsistencies that raised questions or led to mistakes. Digital systems proved that utilizing resources outside the affected area allow for increased scale, increased handling capacity and faster turnaround. Paul Davis Grande Prairie was able to utilize administration teams in the home office allowing them to process more than 12 inspections per day. This was approximately 250 percent more inspections than most contractors could achieve using legacy systems.
Lesson 2: Lack of transparency
creates additional work It became apparent that when narrative reports were generated with limited photographic support, it was hard for reviewers to make effective decisions. In many cases those limited reports created more questions than they answered. Carriers were required to ask for clarification and additional information, which led to a compounding effect. New claims were coming in, but re-inspections and re-worded reports were being requested at the same time, creating an
insurmountable workload for project managers, adjusters and reviewers. Technology changed the way some adjusters were able to work in the field. Kate Nelson, an adjuster at Gore Mutual, noted that “being able to document the loss, attach notes and instructions on how to proceed in real time, and share this with contractors eliminated a huge amount of back and forth calls and emails that take up so much time. Our files were updated automatically while most other teams of adjusters had to wait hours for photos, notes and documents to upload.�
Lesson 3: Early adopters can change the field game Technology quickly changed how data was collected. Contractors and adjusters were utilizing mobile tools that allowed for real-time capture and sharing of photographs, videos, notes, field reports, and the ability to remotely capture signatures and send authorizations from the field. The new technology made accurate and complete paperwork flow instantaneously, letting all parties to work in parallel. Even with reduced capabilities of the communications network tasks could be completed during the day and sent in real-time as the data was collected. This resulted in smaller payloads of information being sent during off-peak hours. Technology that worked both onand off-line was indispensable in the field. Tools that were able to store information on the smartphone or tablet until a reliable connection was made ensured that only one process was utiWinter 2017-18
Claims Canada 25
lized in the field without having to resort to pen and paper and digital cameras. Tamara Roy, of Proserve DKI based in Fort McMurray, went through the devastation of losing her home in the fire, but came back to Fort McMurray to help the community rebuild. Tamara said: “Before we had Encircle, we would take all the photos on site, download them when we got back to the office, put them into the report and then type the report up. With Encircle when you walk out of the house you’re done. It’s a big increase in efficiency because it builds the report for you as you document the claim. Just click and you’re done.” Faced with an extremely challenging and difficult time they were able to refine their process and increase productivity.
Lesson 4: Administrative burdens reduce effectiveness By digitizing administration processes the day-to-day effectiveness of a claim was streamlined, but there were also substantial savings in closing files out. Rob Hryszko who was working with Gore Mutual recognized the advantages: “We shortened our closing cycle time from approximately 2.5 hours to just over 25 minutes. With all the information digitally located in one spot, we were able to quickly and efficiently gather costs and prepare an invoice, and send it to the adjuster without delay.” This shortened cycle time directly translated to increased performance to the adjuster. Kate Nelson, in turn, found “work-
HAVE A TION RESTORA ? N QUESTIO ent? Not a cli lem! No prob t! - no cos s u il a ca Em general. t s r fi @ s question
First General
There when you need us most. 26 Claims Canada
Winter 2017-18
ing with our contractors, who were also on Encircle, I could move on to another claim while contents/stock were being off-loaded and documented. This saved me an hour on every claim and increased my ability to visit more claims each day.”
Lesson 5: The numbers don’t lie
After Fort Mac we were able to work with insurers and contractors to make a rough estimate of the results. On average, project managers were able to increase their claim count from four to five claims a day to 12 to 15 claims inspections a day, with a 150-percent increase in speed. Detailing the loss using photographs and specific narratives increased the quality by over 200 percent, leading to quick reviews the first time through. A dramatic 60-percent reduction of administration process and time meant more time on-site making decisions and less time filing documents. With nearly real-time collaboration, claim submission time dropped by 75 percent and resulted in less decision time.
Lesson 6: Limited connectivity reduces
effectiveness Limited connectivity is common in devastated areas hit by large Cats. Fort Mac had compromised signal strength thanks to rebuilt towers. Combine that with contractors and adjusters working in remote camps with basic services and the huge demand on the Internet in the evening as every adjuster and contractor attempted to transfer photographs and information. Meanwhile workers were using streaming video to talk to loved-ones, resulting in limited bandwidth with massive demand. Information shared by traditional means was severely restricted.
How did Fort Mac spur innovation? Encircle recognized the challenge of getting documents signed in the field. Fort Mac challenged everyone with the displacement of policyholders. Our insurance partners, contractors and policy holders found it very difficult to get signatures captured, because the displaced did not necessarily have access to printers and scanners to get documents signed and delivered. Encircle developed the answer to this challenge with text message/email document sharing where a policy holder can sign the document anywhere in the world where they have a data or cell connection. This is a major digital innovation that was developed by our engineers to solve a very real problem. Getting authorized individuals to sign cannot be delayed, especially in Cat events. Catastrophic events are a time that challenges every part of the insurance industry, from field processes to relationships between carriers and vendors. These events stress the best systems and prompt organizations to figure out how to build their process and protocols. When carriers can obtain a 10- to 20-times ROI on their digital investment, they are able to align the right process with the right technology that delivers real profitability and improves customer service when it counts. • Kris Rzesnoski is vice-president of business development with Encircle. www.claimscanada.ca
• on the scene OTS Industry colleagues gathered at the Sedgwick CMS Canada Inc./Vericlaim Canada Mississauga office on November 6th in celebration of the 80th birthday of Stewart A. Ponton, CIP, CLA, FCIAA. In 1976, Stewart co-founded Ponton Coleshill Insurance Adjusters Limited and actively served CIAA in many roles including National President (1981/82). He was granted the distinguished Honorary Life Member award in 2001 in appreciation and recognition of his years of loyal dedication to the association. ●
L-R: Scott Mastromatteo, NSA Claims; Stewart Ponton; Laurie Walker, Sedgwick; and Ivan Brosbell, ClaimsPro. CIAA Nova Scotia hosted an education session in Sydney, Nova Scotia on November 16th. Presenter Jim Abraham of Canadian Climate Forum and Climaction Services LTD spoke on “Weather and Climate Change in Nova Scotia: Are we getting more extremes? And why”. The event drew a large audience of loss adjusters, brokers, and engineers as well as representatives from the Nova Scotia Department of Housing and Cape Breton Regional Municipality. ●
In the photo (left to right) are: Mario Delorme, Origin & Cause (co-sponsor); Janet Ley, CIAA NS; Jim Abraham (presenter); Ken MacLeod, president, CIAA Nova Scotia Region. Absent from photo, Gary Chant, Meco DKI (co- sponsor). www.claimscanada.ca
Sedgwick Claims Management Services, Inc. will acquire Cunningham Lindsey. “Bringing the incomparable talent, expertise and robust global capabilities of Sedgwick, Vericlaim and Cunningham Lindsey under one umbrella is among the greatest stories to emerge from the claims industry in many years,” said Michael Arbour, Sedgwick group president. “This exciting development puts us in an optimal position to meet the increasingly complex needs of clients around the world.” Cunningham Lindsey group’s 6,000 staff comprise local teams in 600 offices across 60 countries. Their specialties in loss adjusting, thirdparty claims administration, global account management, forensic engineering, and restoration and repair consulting, among others, complement the existing offerings of Sedgwick and its subsidiary, Vericlaim. Following the close of the transaction, the Sedgwick family will be more than 20,000 colleagues strong. The closing of the transaction is subject to customary conditions and regulatory approvals. ● John Martin will join EFI Global Canada as a senior fire investigator. John will help to develop and implement fire investigation services for the company. He is a certified fire and explosion investigator who will be responsible for investigating and assessing fire and explosion damage. John is John Martin an executive board member of the Canadian Association of Fire Investigators, and holds memberships in NFPA, Canadian Fire Safety Association, National Association of Fire Investigators and the London Adjusters Association. John has more than 15 years in fire investigation. He will be based in the Woodstock, London area and will also respond to fires in southern Ontario and the Greater Toronto Area. ● MGB Claims Consultants Inc has opened a Vancouver office to serve the Vancouver and Whistler Region. Jessica Brown will lead the office. Jessica entered the insurance industry in 1999 as a telephone adjuster for a global insurance company. She has over 18 years in the Jessica Brown industry, and has held two claims management positions, with various insurance companies and has been an independent adjuster for the past four years. Her areas of expertise include: Film and Entertainment Production; Cast/Time Element Claims; Ski Hill & Sports Liability; Complex Commercial Casualty; Multi-Party Injury and/or Litigation Claims. ● continued on page 28... Winter 2017-18
Claims Canada 27
• on the scene OTS
...continued from page 27
Crawford & Company (Canada) Inc. has grown its global cyber practice with the addition of Neal Jardine as cyber practice leader, Canada. As a seasoned senior general adjuster with Crawford’s Global Technical Services (GTS) division, Neal has more than a decade of experience, both domestically and internationally, adjustNeal Jardine ing property and casualty claims, including cyber losses. Leveraging his experience as a professional loss adjuster and academic credentials in computer science, Neal possesses a unique set of skills and knowledge to effectively mitigate cyber losses. “We are fortunate to be able to leverage Crawford’s global cyber team to bring to the Canadian market proven best practices in our cyber incident response model,” said Paul Hancock, vice-president, Global Technical Services (GTS), Canada. ●
Petley-Hare Limited, with locations in Pickering, Oshawa and Bowmanville, Ontario and on-line insurance broker, Insurance Jack, has bought Emmerson Insurance Brokers in Port Perry, Ontario. Emmerson, a family owned and operated business since 1917, will extend Petley-Hare’s physical presence throughout the Region Dave Hare of Durham. “Petley-Hare will be a perfect fit to carry Emmerson Insurance into the future. The office culture is a match for ours, staff is like family, clients are like friends. I look forward to watching Emmerson Insurance grow and prosper in the future,” said Larry Emmerson. The business will continue to operate as Emmerson Insurance Brokers, with existing staff, from their current Queen Street location in Port Perry. The purchase was finalized on November 30, 2017. ●
Michelle Livingstone, MASc, PEng, is joining Pario Engineering & Environmental Sciences LP as a forensic engineer, motor vehicle reconstruction. Michelle has extensive experience in forensic engineering and mechanical engineering as it pertains to the design of mechanical systems for commercial buildings, including Michelle Livingstone HVAC, plumbing, and fire protection. Her technical expertise in this regard allows her to provide clients with objective and concise opinions regarding system and structural failures. Based out of Pario’s Concord, Ontario office, Michelle will support the Greater Toronto Area as well as providing services nationally for large loss, accident reconstruction, personal injury, and biomechanical investigations. ● 28 Claims Canada
Winter 2017-18
Paul MacDonald will be joining Economical Insurance in the new role of executive vice-president (EVP) of personal insurance effective early January 2018. Paul will have P&L accountability for broker-distributed personal insurance and support a Paul MacDonald renewed focus in personal lines across distribution channels. He will work in close partnership with Tom Reikman, chief distribution officer, and Fabian Richenberger, EVP, commercial insurance. Previously, Paul was senior vice-president and chief claims officer at RSA Canada. Before RSA, he was vice-president, Canadian operations, for SGI Canada. His experience also includes insurance consulting with PricewaterhouseCoopers and senior leadership positions with Aon Risk Services. He has an MBA from Northwestern University/York University and undergraduate degrees in Law from Dalhousie, and Arts from Queen’s. ●
The Guarantee Company of North America (The Guarantee) has appointed Bev Wittmack and Dawn Tattle to its board. Bev is a Director of JEH Enterprises Inc, a privately owned business consortium with significant holdings in commercial and residential real Bev Wittmack estate in Canada and the US, as well as in the Canadian hotel and agricultural industries. In addition, she is a shareholder and director of Fresnel Management Ltd., a company she established with her husband, providing healthcare management consulting services throughout Canada and the US. Bev also served on Dawn Tattle corporate and government Boards and Committees, primarily in the Province of Alberta. Dawn is an award-winning geo-structural engineer with more than 30 years of experience in the construction industry. She is a consultant, educator and keynote speaker in civil and structural engineering. She serves on the Ontario Ministry of Labour’s Prevention Council. Previously, Dawn was president and partner of Anchor Shoring & Caissons Ltd. She also served on several industry boards and is currently on the Board of Directors for the Toronto Construction Association and is a Fellow of the Canadian Academy of Engineering. ● www.claimscanada.ca
• on the scene OTS Vericlaim has a new office in Halifax. In addition, industry expert René Fenez joins the company as assistant vice-president, Atlantic, and executive general adjuster. René brings more than 20 years of experience in loss adRené Fenez justing and management to his new role. His specialties include commercial and industrial property and casualty, environmental liability, marine hull and machinery, protection and indemnity, inland marine, renewable energy, course of construction, business interruption, professional indemnity, crime and fidelity, and cyber. René leads the new Halifax office and oversees loss adjusting services for the Atlantic Canada region. He also will be a member of the company’s Complex Loss Division. He holds the designations of Chartered Insurance Professional, Insurance Institute of Canada, and the Canadian Risk Management, Global Risk Management Institute, as well as the California Earthquake Adjuster accreditation. ● IndemniPro has made organizational changes in Quebec. After a 16year career with IndemniPro, Suzie Godmer has decided leave her current position as senior vice-president, Quebec and Atlantic Canada to join one of Canada’s largest insurers, effective January 2018. Christopher Tirrell, presently an operations manager for IndemniPro, will succeed her. Christopher has experience in both business development and operations. He will continue to be based out of IndemniPro’s Montreal branch office. Michel Lacelle, regional director, Quebec West, will become vice-president, organizational services. In this position, Michel will have specific accountabilities for integration of acquisitions in Quebec, shared services reporting, licensing for Quebec, development of IndemniPro’s Quebec Claims School, Emergency Claims Services management for both the Quebec and Atlantic regions, CAT operations in Quebec, and he will continue to provide oversight for the IndemniPro Specialty Risk Division in Quebec. He will also be based in Montreal. Both Christopher and Michel will report directly to Lorri Frederick, president of ClaimsPro/IndemniPro. ●
CIAA New Members — October 2017 INDIVIDUAL MEMBERSHIP
ESIS Canada Inc. Jocelyn Ho, BA, MA May Ng, CIP, CRM
Toronto Toronto
Level 2 Level 3
Leading Edge Claims Services Inc. Patricia Heaney, CRM, CFEI Fonthill, ON
Level 2
Marsh Adjustment Limited/Réclamation Marsh Adjustment Jostin Frenette Grand Falls, NB Level 1 Manon Gamache, CIP Edmundston, NB Level 2 Larry Hay, CIP Bedford, NS Level 3 Leigh-Ann Jeffcock, BA Bedford, NS Level 1 Donna Nash, CIP Fredericton, NB Level 2 QA Adjusting Company Eric Sizeland, BA, B.Ed.
Winnipeg, MB
Sedgwick CMS Canada Inc. Debbie Laxton Mississauga, ON
Level 1 Level 1
CIAA New Members — November 2017 INDIVIDUAL MEMBERSHIP
Crawford & Company Joshua Landry
Dartmouth, NS
Pearce Insurance Adjusters Brian Lund, BA (Hons) CIP Millbrook, ON
Level 1 Level 3
continued on page 30... www.claimscanada.ca
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Claims Canada 29
• on the scene OTS
Alex Williams
...continued from page 29
On Side Restoration Services Ltd. has expanded with a new Halifax branch led by industry veteran Alex Williams, as branch manager. Alex has been with On Side over six years, and has more than 12 years industry experience. He took over the Grande Prairie branch back in 2014. “I look forward to reaching out to the business and insurance communities in Halifax and getting to know new faces. Our
With over 40 offices on 5 continents, over 30 language fluencies, 18 distinct professional designations and a work history that spans more than 130 countries and 800 industries, we are truly world-class experts with a global reach. To work with a member of our respected team contact any one of our Canadian offices or visit us at mdd.com.
30 Claims Canada
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office location is still getting scouted out but I’ll have boots on the ground ready to go in early 2018,” Alex explained. He is well versed within the emergency restoration sector. He’s worked in several positions including the field, operations manager, project manager, as well as his latest role as branch manager. He also holds his Master Water Restorer through IICRC. ●
For its 16th Annual Technology Conference (ICTC 2018) InsuranceCanada.ca is focusing on the opportunities and challenges provided by new technology in use by Canadian insurers and brokers. AI and its counterparts—machine learning and advanced analytics—are coming into play in insurance companies and larger brokerages. Early implementations are demonstrating the use of AI in claims settlements, providing more accurate insurance product pricing and allowing customers ease of access to a variety of coverages. From the buyers’ perspective, insurers and brokers are finding that customer experience is a critical success factor for attracting consumers while utilizing advanced technologies. Kanetix Ltd will discuss some of the challenges for customer-facing insurance providers as they optimize the customer experience, and techniques—including AI—to better address human behaviours. Other sessions at ICTC 2018 will cover a larger landscape. Experts from the analyst, insurer and technology supplier communities are preparing sessions focused on Blockchain, IoT (Internet of Things) and Digital insurance technologies. David Coletto, CEO at Abacus Data, will provide the keynote address. Based on more than seven years of research, Coletto’s presentation will describe the context around all the technologies, and will offer a Canadian perspective on generational change (Millennials and Gen Z) and the disruptive forces at work in both consumer and insurance markets. The 2018 Insurance-Canada.ca Technology Conference, entitled Insurance Vectors in Play, will be held on February 27-28, 2018 at the Beanfield Centre in Toronto. ● www.claimscanada.ca
• on the scene OTS The 20th annual WICC Ontario Learning Breakfast for Cancer took place November 7 at Toronto’s historic Fairmont Royal York. Attended by more than 400 insurance professionals, the event featured a moving keynote by Dr. Michael Taylor, pediatric neurooncologist at the Hospital for Sick Children, on the encouraging progress being made in the treatment of childhood brain tumours. The fundraiser also celebrated WICC Ontario’s Volunteer of the Year: Hoa La, the tireless president of Mississauga, Ont.-based EcoPure Cleaners.
The 44th annual Engineering Insurance Conference covered hot topics including the application of blockchain technology, analytics for claims handling, tornado and natural hazard resilience and renewable energy storage. Produced by the Canadian Boiler and Machinery Underwriters’ Association, this year’s event transpired on October 5 in Toronto.
www.claimscanada.ca
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Claims Canada 31
APPOINTMENT
David Gambrill David Gambrill has been appointed Editorin-Chief of Canadian Underwriter, effective November 13, 2017. “David is an award-winning writer and editor who’s arguably Canada’s most experienced and knowledgeable insurance journalist,” says Ian Portsmouth, Managing Director of the Insurance Media Group, which publishes Canadian Underwriter, Claims Canada, the Ontario Insurance Directory and other online vehicles for property and casualty insurance professionals in Canada. “David is held in high esteem by many veterans of this industry, and I am delighted with the opportunity to work with him on extending Canadian Underwriter’s leadership in the insurance media market.” David returns to the same role he occupied from 2005 to 2012. Under his editorial leadership, traffic to CanadianUnderwriter. ca tripled, and the magazine won Kenneth R. Wilson Awards from the Canadian Business Press. At the invitation of major insurance organizations, David frequently spoke at a variety of industry functions, including events organized by A.M. Best, the Insurance Institute of Canada and Aviva Canada. “I am delighted, proud and privileged to re-join a magazine that has a long history of consistently leading the field in insurance business journalism,” David says. “Canadian Underwriter features an excellent team dedicated to helping insurance professionals excel in their careers and business. I’m honoured to be given the opportunity to guide the production of timely, informative and relevant content, offered in a wide variety of print and digital formats.” For most of the past five years, David served in a senior communications role with the Insurance Institute of Canada. Prior to his first stint at Canadian Underwriter, David wrote for and edited several respected trade newspapers and magazines, including Occupational Health and Safety, Law Times and Canadian Lawyer, where he won a Kenneth R. Wilson Award for Best Profile.
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• on the scene OTS A record crowd of nearly 750 packed a Hilton Toronto ballroom for the annual Christmas Luncheon of ORIMS, the Risk and Insurance Management Society’s Ontario chapter. Held December 7 to celebrate the season and give back to the local community, this year’s event directed all proceeds from a raffle and food drive to Toronto’s Daily Bread Food Bank.
www.claimscanada.ca
• on the scene OTS
APPOINTMENT
Stephen Lowe Total Textile Solutions is pleased to announce that it has appointed Stephen Lowe of Burlington, Ont. as its new National Sales Manager. Mr. Lowe has more than 20 years of experience in sales, success consulting and strategic planning. For the past 10 years he has worked with international suppliers in the hard goods sector, supplying disaster restoration contractors in both Canada and the U.S. Stephen has a strong understanding of the needs of restoration contractors, insurance companies, and independent adjusters. “Our objective is to build strong relationships with national property restoration contractors, insurers and independent adjusters,” says Lowe. “As we continue to expand our footprint, we will provide even more benefit to our customers. Companies operating regionally and coast to coast want consistent service from a textile restoration company, so it makes sense for them to deal with a company that has a national business presence.” Since early 2010, Total Textile Solutions has had members operating in Quebec, Ontario, Manitoba, Alberta and B.C., and is looking to expand its footprint to the Maritimes in 2018. With 10 locations servicing most major cities and towns across Canada, Total Textile Solutions is rapidly emerging as a leader in the Canadian textile disaster recovery industry. Total Textile Solutions is a fullservice textile restoration provider with expertise in water losses, fire and smoke damage, sewer backup and odour control. It is a memberowned organization with each service location having a vested interest in the companies’ success.
www.claimscanada.ca
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Claims Canada 33
• on the scene OTS Try to distill all of the lessons and insights imparted by speakers at the inaugural InsurTechTO conference into a single prescription, and you might get this: Technological change is everywhere in the insurance industry, and you’d better do way, way more than just get used to it. Organized by Insurance-Canada.ca, the Nov. 6 event included a pitch competition (won by “smart form” developer FormHero) and presentations on a wide range of technology topics, including how to create an innovation ecosystem, leveraging data to make brokers more competitive, and, our favourite, “Broker 2.0: The Transformation of the Modern Broker,” moderated by Canadian Underwriter’s own Ian Portsmouth.
34 Claims Canada
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www.claimscanada.ca
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