The Canadian Association of Financial Institutions in Insurance (CAFII) has launched a new website that aims to educate consumers on the credit protection insurance products that banks and credit unions sell.
The new website (www.CAFII.com) provides detailed information on products such as mortgage life insurance, mortgage disability and critical illness insurance, travel insurance and credit card insurance.
CAFII represents the insurance arms of Canada's major banks as well as various other companies that sell creditors' insurance. The new website is part of an effort by CAFII to make insurance simple and accessible for Canadians, according to Keith Martin, co-executive director of CAFII.
"Consumers benefit from having a wide choice of insurance products and distribution channels in Canada, but many are not familiar with them or how they work," says Martin, in a statement. "While our new website is still a work in progress, we hope that consumers will find it useful in helping them make more informed choices."
Creditors' insurance products have faced scrutiny from some life insurance industry stakeholders and consumer advocates for many years. For example, these groups have argued that clients aren't provided with adequate information about these products at the time of purchase; the individuals selling these products aren't trained adequately; and clients aren't presented with any alternative options, such as term life insurance.
In addition, scenarios in which claims have been denied on products such as mortgage life insurance have led to negative publicity surrounding these products.
The new website features a list of frequently asked questions (FAQs) that address some of those concerns, such as: "If I make a claim one day, how can I ensure it will not be denied?" and "What are the benefits of credit protection insurance compared to traditional term life insurance?"
The website points to statistics from consulting firm Willis Towers Watson PLC stating that 95% of mortgage life insurance claims are paid.
The website also provides information on how consumers can make a complaint to their insurance provider.
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