As tariffs and a potential trade war loom over the Canadian economy, Insurance Bureau of Canada (IBC) has renewed its call for the removal of ‘arbitrary’ barriers impeding adjusters’ mobility.
The Canadian property and casualty insurance industry is calling on regulators and policymakers to adopt a system of reciprocity — meaning if an adjuster is licensed in one province, their licence would be recognized nationwide.
Threats of tariffs on Canadian goods have been swirling since before the re-election of U.S. President Donald Trump. Following his Jan. 20 inauguration, Trump has threatened to impose 25% blanket tariffs on all Canadian goods and 10% on Canadian energy, possibly as early as Mar. 4, 25% on steel and aluminum on Mar. 12, and 25% on autos, pharmaceuticals and semiconductor chips in April.
Moves by the Trump administration to implement tariffs on its closest ally and largest trading partner has generated a new push by Canadian officials to consider ways to break down barriers to interprovincial trade and labour mobility. “This is good news for the property and casualty (P&C) insurance industry, specifically as it relates to adjuster mobility,” IBC vice president of strategy Liam McGuinty writes in Tuesday’s article.
Canada’s Minister of Transport and Internal Trade Anita Anand specifically cites, in a Feb. 9 op-ed piece, the “lengthy certificate recognition and licensing processes that delay regulated workers from going where they are needed most. Right now, it is easier for wine producers in [Nova Scotia’s] Annapolis Valley to send their bottles to France than to neighbouring provinces.”
Long-standing concern
From the P&C side, a coalition of eight P&C associations has renewed its long-standing plea for Canadian policymakers to eliminate a pain point that impacts the industry’s ability to respond effectively to consumers after severe weather events.
In a Feb. 10 letter to the Canadian Insurance Services Regulatory Organizations (CISRO), the coalition calls for major reforms to Canada’s adjuster licensing regime — specifically, that policymakers adopt a system of reciprocity so adjuster licences be recognized across the country.
After Trump delayed some proposed tariffs for 30 days earlier this month, Anand was asked if interprovincial barriers could be dealt with within that timeframe. She responded, ‘The short answer to your question is yes,’” McGuinty writes.
Each province currently has its own licensing requirements. This impedes the mobility of adjusters, who are prevented from operating in other provinces without special permission from regulatory authorities.
“There has never been a more critical time to examine the barriers impeding adjuster mobility across the country, for two primary reasons,” McGuinty writes.
First, a Canada-U.S. trade war could limit Canada’s ability to tap into American adjuster capacity, “in which case Canadian adjuster capacity would be tested like never before.”
Second, the rapid growth in the severity and frequency of severe weather events is testing domestic adjuster capacity. “Canada just experienced its worst-ever year for insured losses caused by severe weather events, and the ability to rapidly deploy labour across the country is critical.”
Looking to other jurisdictions
In communications with policymakers, the coalition notes other jurisdictions have found ways to facilitate the free flow of adjusters. For example, in the U.S., all but three states offer reciprocity on adjuster licensing (New York, California and Hawaii are the exceptions).
The coalition also highlights similarities between Canada’s provincial licensing requirements — such as hours of training, nature of education, scope of licence and oversight requirements. “Similarities between regimes confirms that there is no reasonable public policy rationale for not introducing a system of reciprocity,” IBC’s article says.
Proposals for licensing reciprocity are nothing new. In 1990, federal, provincial and territorial governments (FTP) established an Agreement on Internal Trade (AIT) to facilitate the free flow of trade and work mobility in Canada. In 2011, FPT ministers committed to adding financial service occupations, including insurance adjusters. Such amendments came into force in 2012.
AIT labour mobility provisions were reaffirmed in 2017 with the introduction of the Canadian Free Trade Agreement; they provide the framework for implementing a national system of reciprocity. In the interim, CISRO agreed in 2014 to implement a pilot to streamline a reciprocity process in recognition of the need for insurance companies to be able to deploy enough adjusters to a disaster zone to quickly begin the claims process.
“However, the pilot did not mature to a fully operational framework,” McGuinty writes.
Canadian governments appear willing to undertake the difficult work necessary to facilitate the movement of goods and labour within the country, the article says. “The P&C industry stands at the ready to work constructively with governments and regulators to remove barriers to labour mobility, improve the claims landscape, and ultimately make Canada a more resilient country.”
Feature image by iStock.com/aquaArts studio
