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Insurance Bulletin 2022-02 - Elimination of Best Terms Pricing Practice

Bulletins and notices.

The Superintendent of Insurance in New Brunswick is a member of the Canadian Council of Insurance Regulators (CCIR). CCIR is an inter-jurisdictional association of insurance regulators.  CCIR’s mandate is to facilitate and promote an efficient and effective insurance regulatory system in Canada and to develop solutions to common regulatory issues in Canada.

In December 2020, the CCIR issued a news release stating that it would look at the practice of Best Terms Pricing (BTP) on subscription policies within the broader commercial insurance market. The review was based in part on the prior work of British Columbia and Alberta surrounding the impact of BTP on the strata/condominium subscription policies.

Best Terms Pricing is a method of pricing a subscription Insurance policy, where there are multiple insurers covering varying portions of a particular risk. The premium payable is established based on the highest quote provided by any participating insurer. The insurers are paid uniformly based on the highest rate offered, regardless of the risk allocation.

In December 2021, the CCIR issued a news release that concluded that BTP exists in the broader commercial market and outcomes, including adverse premium inflation, do not support the fair treatment of customers.  It was concluded that the use of BTP should cease to ensure fair and transparent pricing in the marketplace.

The Superintendent of Insurance in New Brunswick expects insurers to discontinue the practice of using BTP by January 2023.

Should you have any questions or concerns regarding the use of BTP, please email or phone 1 (866)-933-2222.