Insurance Bureau of Canada (IBC) has submitted a brief on Bill 96 regarding proposed amendments to the Charter of the French Language. Echoing the views of other sources that Insurance Portal interviewed, IBC expects the changes to section 55 of the Charter to have a major impact on the insurance industry.
IBC’s brief was produced in parallel with the work of the Committee on Culture and Education charged with analyzing the bill, which comprises more than 200 sections. Neither IBC nor RCCAQ had the opportunity to appear before the parliamentary committee.
Specifically, Bureau believes that section 44 of the bill “will cause a problem of fairness in the treatment of consumers’ freedom to enter into contracts. Insurers are already required to treat the consumer fairly, which includes providing customers with information that allows them to make informed decisions about insurance products and their assets at all stages of the transaction. The insurers’ process already allows the consumer to choose the language of communication.”
IBC also pointed out other problems. For example, auto insurance transactions could be delayed if the consumer chooses a language other than French. This would postpone the effective date of the policy and subsequently the date the client takes possession of the car, the Bureau notes.
Changes to the insurance contract during the term will also take longer. Insurers will be obliged to send consumers massive amounts of documentation that does little to aid their understanding and decision making, the IBC continues.
Closing the transaction
What’s more, the proposed change will create uncertainty about the closing of a transaction. “It will be difficult, if not impossible, for the insurer to verify whether a consumer has actually read the French version of the insurance policy,” IBC points out in the brief.
Failure to comply with the new contract language requirements has significant consequences, the IBC adds. “A contract that is null and void is deemed never to have existed, and this is not in the interest of insureds and victims. The nullity of a contract under the new section 55 is not an appropriate sanction in the insurance field, nor is it in the interest of the insured," the Bureau says.
The distinctive characteristics of the commercial insurance market pose another problem. “To meet the needs of commercial policyholders, several risk management mechanisms are in place, such as layers of insurance that involve multiple insurers participating in the indemnification. The obligation created by the new section 55 could bar Quebec from the international commercial insurance market,” IBC says.
IBC believes after the legislation passes, insurers must be given a reasonable amount of time to make the necessary changes to their internal procedures.
Other costs
Section 5 of Bill 96 amends section 9 of the Charter by requiring a French translation of a pleading drawn up in English issued by a corporation. According to the impact analysis produced by the Quebec Justice Ministry, this requirement will not create additional costs for businesses.
IBC disagrees. Given that a large volume of insurance claims files are litigated, “this requirement will increase insurers’ operating costs. These expenses will eventually be passed on to consumers.”
As drafted, the proposed amendment to section 9 “does not respect the principle of proportionality found in the Quebec Code of Civil Procedure because it makes the proceedings more cumbersome, and creates additional costs and delays without any significant benefit to users,” IBC argues.
“To achieve its objective, the legislator could stipulate instead that the legal person must provide a translation only when the other party requires it,” the IBC continues.
Section 116 of Bill 96 creates a new section 208.6 in Chapter IV of the Charter dealing with proceedings. The new provision states that "a pleading to which […] no certified translation is attached cannot be filed at a court office.”
IBC notes that “in the case of an injunction, which is an urgent measure to avoid serious or irreparable harm, the time required for translation could render the proceedings ineffective.” If this provision is retained, the Bureau recommends that the statute provide for an additional time to translate the pleadings.
IBC also questions the new section 46.1 of the Charter provided for in section 36 of Bill 96, concerning the requirement of a language other than French at work. This section specifies that the employer is deemed not to have taken all the means to avoid imposing knowledge of a language other than French.
According to IBC, the conclusive presumption of non-compliance with the law created by this section may encourage employers to hire or promote bilingual individuals outside Quebec. The Bureau believes that this presumption should not be absolute, and recommends that the government grant businesses time to adjust their hiring and promotion practices.
