Elimination of Best Terms Pricing practices in BC
Published February 8, 2022
The BC Financial Services Authority (BCFSA), the regulator for insurers operating in BC, has issued a regulatory statement prohibiting the practice of Best Terms Pricing (BTP) to determine premium pricing in an insurance policy.
The statement from the authority defines BTP as “a procedure or practice where an insurer participating on a subscribed insurance policy covering a risk in BC receives a higher premium price than its own bid, based on a higher premium bid from another insurer on the same subscription policy.” BCFSA has instructed insurers to discontinue BTP practices with the deadline of January 1, 2023, to fully end the practice.
Insurance Council licensees who work with insurers to obtain policies are obligated to cease BTP-related activities in accordance with BCFSA’s regulatory requirement. Failure to do so may result in disciplinary action, as licensees are required by the Insurance Council’s Code of Conduct to comply with all applicable regulatory requirements under the Financial Institutions Act.
Following a review conducted by the Canadian Council of Insurance Regulators
(CCIR), an inter-jurisdictional association of insurance regulators, it was determined that BTP practices do not support fair treatment of customers. As a member of CCIR and participant of the review, BCFSA along with other provincial regulators, concluded that insurers must cease BTP practices in the best interest of the public.
View BCFSA’s regulatory statement
for more detailed information, including practices not considered BTP.