Brokers want Manitoba Public Insurance to put the brakes on push for more online services

A plan to allow Manitoba drivers to buy some of their auto insurance online has raised the ire of brokers, who worry they would be pushed aside.

Grant Wainikka, CEO of the Insurance Brokers Association of Manitoba, is worried a proposed shift to an online model — which may allow for basic transactions like renewing auto insurance to be done online, instead of in person with a broker — would exclude the services of insurance agents and result in job losses among the 2,600 people working for Manitoba's brokers.

"The success of the independent small business, or broker, is very much dependent and interdependent with the relationship with MPI," Wainikka said.

"Anything that is done that throws that balance off could have very serious ramifications for the broker channel in Manitoba and we're obviously fighting that."

Based on his conversations with MPI, Wainikka said it's not entirely clear that a potential move to an online model would reduce the need for insurance brokers, but that's what he worries would result.

Conflict with boards

"The upshot of this is that there could be implications on small businesses in Manitoba," he said.

A move to an online service model is reportedly behind a clash between the Tory-appointed MPI board of directors and the brokers association. The Winnipeg Free Press reported Thursday that the provincial government is lobbying on behalf of the insurance agents, raising accusations from an unnamed board member that the government is interfering in the operations of a board it appointed.

That wouldn't be the first conflict between the Progressive Conservative government and a Crown corporation board. Last March, the Manitoba Hydro board resigned en masse, and Manitoba Liquor & Lotteries and its board chair parted ways earlier this year.

Manitoba Public Insurance board chair Mike Sullivan dismissed the criticism there's unrest between the province and his board, although he's only spoken with his colleagues by conference call since his appointment as chair was announced in February.

"I think people are entitled to their opinions," Sullivan said, referring to the anonymous board member.

The new MPI chair is a dentist in Portage la Prairie — the same city where Premier Brian Pallister once worked as an insurance agent. 

Sullivan said the province wants the public insurer and the insurance brokers association to work out their differences.

'Brokers play an important role'

Crown Services Minister Colleen Mayer agrees. 

"We expect Manitoba Public Insurance and insurance brokers in this province will work together to modernize service delivery including, but not limited to, online services," Mayer said in a statement. 

Sullivan said MPI customers want online services. The Crown corporation says its customer surveying supports that.

We don't think that the government would make the best retailer of insurance.- Grant Wainikka, Insurance Brokers Association of Manitoba

Wainikka said his association embraces online delivery, but he argues that should be conducted through brokers.

"We don't think that the government would make the best retailer of insurance," he said.

Buying financial protection is complicated, he explained, and consumers often go online first, but finalize their purchases with the help of an expert.

"The broker is there today and we think that's a very cost-effective and very customer-friendly way to work consumers through these transactions," Wainikka said. 

$83M to insurance brokers

Insurance agents receive compensation for every transaction they finalize. MPI paid $83 million to independent insurance brokers in 2017, the Crown corporation's annual report for that year says.

Management at MPI declined an interview, but in a prepared statement, CEO Benjamin Graham said "discussions are being held on how this customer service model will evolve over time to meet the changing needs of our customers."

"MPI is committed to working with IBAM and I believe both organizations are going to move in the right direction for the benefit of Manitobans," he said.

NDP Leader Wab Kinew understands that customers want online access, but he acknowledges the changes may threaten insurance jobs.

"I think there is a conversation to be had about that, but I don't think it's a conversation that should be led by a premier who's got some serious ties to this sector."