Most Interesting Findings
ATB Financial, and its subsidiary, ATB Insurance Advisors Inc., have been dancing blatantly around the Bank Act for over 3 years now. This “avoidance” of the rules of the Bank Act of Canada does not legally apply to ATB Financial, since it was formed under Alberta provincial legislation called the Alberta Treasuries Act. All this is in regards to ATB selling personal life insurance, disability insurance, critical illness insurance and other types of personal insurance products through its branch network in Alberta.
All other major banks in Canada are unable to sell personal insurance through their branch networks. The only product that can be purchased in a branch is an “Authorized Type of Insurance”. The Bank Act of Canada clearly states that only Authorized Types of Insurance can be sold in branches, promoted to clients, or advice/referrals given from a branch employee to an insurance agent. An Authorized Type of Insurance is detailed here, but suffice to say it includes creditor insurance, mortgage insurance, travel insurance, and extended insurance protection on credit cards. All these types of policies are sold on a group basis, and no customer personally owns their insurance product. Here is a quick overview of what should and shouldn’t be done inside a bank branch when promoting insurance products:
Table 1: Bank Sales and Promotion
of Authorized versus Other Types of Insurance
Activity: Sales
Authorized Types of Insurance: Can be sold in bank branches.
Other Types of Insurance: Can be sold through insurance subsidiaries of banks, but not bank branches.
Activity: Advice/Referrals
Authorized Types of Insurance: Can provide advice on an authorized type of insurance or a service in respect of an authorized type of insurance.
Other Types of Insurance: Can provide advice that is general in nature and not related to a specific risk, insurance policy or service, insurance company, agent or broker. Cannot refer customers to particular insurance companies, agents or brokers.
Activity: Promotion
Authorized Types of Insurance: Can promote policies of authorized types of insurance, as well as companies, agents and brokers that deal only in authorized types of insurance.
Other Types of Insurance: Can promote these types of insurance to all customers or credit or charge card holders who receive regularly mailed statements of account or to the general public, outside of bank branches. Cannot “target-market” customers; that is, cannot segment the customer base and promote specific types of insurance to selected customers. The same restrictions apply to bank promotion of companies, agents and brokers that sell these types of insurance.
What is ATB Financial Doing?
ATB Financial, through its subsidiary ATB Investor Services (the trade name of a number of financial services companies including ATB Insurance Advisors Inc.) has been selling personal life and health insurance through its branch network, including insurance investment products like segregated funds and GMWBs. The staff working in the branches, like personal bankers, financial advisors, account managers, etc., all have been promoting the products and advice of the Insurance Advisors of ATB Insurance Advisors Inc. ATB Financial clients are given insurance marketing material in branches, are referred directly to the insurance advisor who then contacts the targeted clients directly. Then, more often than not, the actual sales appointment, where the client meets with the insurance advisor, is taking place inside the ATB Financial branches across the province. This is clearly in contradiction to the Bank Act as described above.
All of ATB Insurance Advisors Inc.’s sales team are insurance brokers, representing such companies as Manulife, Canada Life, IA Pacific, Sun Life, Equitable Life, etc. Normal insurance brokers in Alberta are not allowed to be affiliated with the major banks, and no insurance leads would ever come out of bank branches to such advisors. Even employees of bank owner investment firms who sell insurance products, like RBC Dominion Securities or TD Waterhouse, never set foot inside a bank branch on insurance business and would never legally receive a lead from branch employees.
Why can ATB Financial do this?
ATB Financial is not governed by the Bank Act of Canada. It was formed under the Alberta Treasuries Act and can only operate within Alberta and cannot expand services outside of the province due to this. This allows ATB Financial to have special status inside the province, and flaunt that special status over their national banking rivals.
Is it an unfair trading practice?
When all other banks have to work within the confines of the Bank Act, and ATB Financial does not, does this give ATB an unfair trading practice in Alberta? Does ATB Financial get unfair access and “target-marketing” opportunities to their large banking client base that other national banks do not? YES! Laws and legislation is fundamentally meant to create an equal playing field for business to operate in. The legislation allowing ATB Financial to offer personal life and health insurance products from its branch network should be challenged, or at least reviewed by the Alberta Insurance Council.
Where major Canadian banks offering insurance products have to build separate insurance branches, do extensive media advertising, and promote their products through the broker network in Canada, ATB Financial does none of this. They directly target market their best clients, broker insurance policies from various insurance companies, and conduct sales meetings in branch. How is an ATB client to know that this is not really a bank offered service in conjunction with their loans or investments? They can’t. There is too much room for abuses like “tied selling” in ATB’s model. Couple this with the fact that the Alberta Insurance Council is probably unaware of ATB Financial’s trading practices regarding selling personal insurance, and you have an unregulated insurance sales-force, free of oversight or scrutiny.
Calling for a review of ATB Financial’s insurance business
This article is to shed some light on how ATB Financial is selling insurance products across Alberta, Canada. The Alberta Insurance Council (AIC) should review ATB Insurance Advisor Inc. sales practices in accordance with the laws governing the sale of personal insurance through the ATB Financial branch network. A complete review of the situation might lead to a justified amendment of the law, making ATB an equal competitor to all other major banks in Canada.
Posted in Legal · August 28th, 2010 · Comments (0)
When you are exposed to numbers as other people you too could be one of those who collects and recalls certain numbers. The federal debt of the United States is about $8 trillion and about $28,000 is allocated to every American family. When this happens, it is scary. Still something is much frightening. More than a million lawyers have been able to pass the bar in the United States.
When it comes to a million lawyers, this has never happened before. Even in today’s world, this many lawyers are not easy to go about. Some lawyers are necessary for the operation of a modern society. From a multitude of cases we need to deal with there are defense attorneys, prosecution attorneys, patent lawyers, contract lawyers, and corporate lawyers. Depending on the services they provide, in a class by themselves are the personal injury lawyers and class action lawyers. If you are looking for more information on personal injury solicitors make sure to visit their website.
People who are religious firmly stand by how they see God as the bringer of punishment to sinners. For Noah and a chosen few, they were the only survivors after God sent a flood thousands of years ago. With the Jews in bondage, God sent seven plagues upon Egypt later on. Not to be reckoned with during the Middle Ages was the deadly black plague that swept the population.With regard to personal injury lawyers in the United States, this is probably the harshest punishment that God could send to man.
Personal injury lawyers are the people who sue businesses when people are injured. In this example, there is BC who is a man who hopes for some rest and relaxation as he went to the city of Brooklyn. During his pursuit of his R&R, BC was hit in the head by what he described as a set of massive boobs belonging to a dancer. With the sudden impact came about some bruising, contusions, and even lacerations. Demanding $200,000 was the lawyer of BC for his client’s indignity, emotional stress, and mental anguish. Aside from emotional stress, BC may have encountered mental anguish as he was struck by the 57 inch bosoms.
While in New York City one Canadian chose to go to one of the popular coffee shops in Manhattan to get himself some coffee. Another thing he did was use the toilet there. He needed some toilet paper afterwards and reached for it. When he did this, the seat shifted and his manhood was clamped to the toilet bowl causing him immense pain in the men’s bathroom. Demanded by his lawyer is a million dollars in damages due to his injury and his wife is also filing a case against them for the loss of his marital services amounting to another $500,000. The funny thing here is how his wife only sees his manhood as worth half. You can get resources on melbourne compensation lawyer by visiting this site.
Nowadays, not much responsibility is claimed by people for what they do. One Pensacola, Fla man decided to go out drinking with his friends. He had a lot of friends and did a lot of drinking before he got so drunk that he wandered off in the wee hours and passed out on the railroad tracks.
Severing his right hand as it passed by suddenly was a train he never got to see. How is he? He was sleeping on the tracks and the railroad still let a train pass and he sued them for this negligence. He managed to get $900,000.
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Tags: law
Posted in Legal · August 26th, 2010 · Comments (0)