Ban on bank web selling to protect insurance brokers
Canada is extending the ban on banks selling certain types of insurance in branches to stop them selling them on their websites, in a move designed to protect brokers, Reuters reports.
"These measures were made necessary by the evolving use of technology by banks," said Finance Minister Jim Flaherty in a statement.
The new rules distinguish between authorised insurance products, such as credit and travel-related insurance, and non-authorised products, such as life, property and casualty insurance.
Under the directive, Canadian banks can display links to subsidiaries that deal in non-authorised insurance only on their corporate web pages, where no financial products are promoted.
Protect brokers
Several banks are aggressively trying to expand their insurance businesses.
The Office of the Superintendent of Financial Institutions ruled last June that "a bank website is not a bank branch", allowing banks to sell insurance products on their websites.
Flaherty said he disagreed with the ruling, which was seen as a blow to insurance brokers across Canada.
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