Insurance is the transfer of risk from a person or business to an insurance company. This is facilitated through the purchase of an insurance policy. The policy is a contract that states the terms and conditions by which the policyholder will receive financial protection from the insurance company in the event of a covered loss.

It is important to note that contracts of insurance are between the consumer and the insurance company only. An insurance broker is not party to the policy.

An insurance broker is a key advisor to you, your family, and/or your business — similar to a lawyer or financial advisor. Insurance brokering is a regulated, licensed profession in Saskatchewan and, as such, meets high standards for education, integrity, and consumer protection.

An insurance broker represents you. They get to know your unique circumstances and present you with coverage options to suit your individual needs. Brokers sell insurance products from multiple different insurance carriers, providing you with choice as well as unbiased service and advice.

Insurance carriers, meanwhile, create the insurance products (think of them as the ‘manufacturers’) and sell their products through brokers or directly to consumers — or both. An insurance agent is an individual who sells insurance products from only one carrier. Agents may work directly for the carrier or they may operate an independent business.

Although insurance brokers are most well known for the sale of insurance policies, brokers may provide consumers a full suite of support and services, including:

• Pre-sale due diligence, such as assessing needs and obtaining quotes;
• Explaining terms, conditions, and premium changes (this may include comparing coverages offered by multiple insurers);
• Providing information on how to reduce or better manage risks;
• Conducting administrative follow-up, such as providing certificates of insurance;
• Providing advice and revisions at policy renewal or mid-term, as required (this could require amending policies as a result of material changes, such as the sale of an asset or relocation);
• Answering your questions — the vast majority of brokerages are well-established in the community, and insurance is their primary business; and
• Advocating insurance carriers and/or independent adjusters in times of loss to ensure customer claims are handled fairly and ethically.

Insurance brokers are generally compensated through commissions paid by insurance companies — not by individual customers.

This method of distribution has many inherent benefits to consumers and insurance companies alike. For example, it allows carriers to focus their resources on underwriting and claims, while allowing brokers to serve customers with choice and unbiased advice.

Any fees paid by consumers to insurance brokers over and above policy premiums must be disclosed and agreed prior to issuing a policy.

In Saskatchewan, insurance brokerages are the primary distribution channel for compulsory auto insurance coverage on behalf of Saskatchewan Government Insurance (SGI) and the SGI Auto Fund. In this capacity, brokers are also known as issuers, and are also responsible for providing other core SGI motor licence issuing services, such as coordinating vehicle registration and drivers' licenses.

Additional auto insurance over and above the legally mandated minimum coverage can be purchased through licenced insurance brokers as well. Drivers should fully understand what they are and are not covered for before getting behind the wheel. Visit betterthanbasic.ca to learn more.

All insurance companies have defined claims procedures and claims escalation processes; and there are both internal and external dispute mechanisms should a consumer feel their claim has been unfairly handled. While a broker may provide advice or advocacy in that process, contracts of insurance are between and the policyholder and the insurance company, and must be resolved by those parties.

If the policy is held with any insurance company other than SGI, a complaint may be submitted through the Financial and Consumer Affairs Authority (FCAA) by clicking here. FCAA may direct the complainant to the General Insurance OmbudService. Most insurance companies, however, have an in-house ombudsman or fair practices office, which will attempt to remedy disputes before they are elevated. 

If the policy is held with SGI, meanwhile, because it is a Crown corporation (and not subject to The Insurance Act), the dispute should first be addressed through the SGI Fair Practices Office. Should that process not result in a satisfactory resolution, policyholders may file a complaint with Ombudsman Saskatchewan.

Please note that most of the aforementioned avenues are not necessarily binding. Instead, they leverage tools such as research, industry outreach, and mediation. Serious disputes that cannot be resolved through these channels may only be addressed through legal means.

If you feel your insurance broker failed in their licensed duties or responsibilities, you may file a complaint with the General Insurance Council of a Saskatchewan (GICS) by clicking here.

A copy of The Insurance Act can be found here.

A copy of The Insurance Regulations can be found here.

A copy of The GICS Bylaws can be found here, while the Agent Code of Conduct can be found here.