CSIO eSlips Advisory Report: E-Delivery of Motor Vehicle Insurance Cards

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eSlips Advisory Report:

E-Delivery of Motor

Vehicle Insurance

Cards

Fall 2015

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E-DELIVERY OF MOTOR VEHICLE INSURANCE LIABILITY CARDS

By Daniel Fabiano, Fasken Martineau DuMoulin LLP

1. Background

Canadian motor vehicle owners are required to insure their vehicle for third party liability and

basic accident benefits coverage. Provincial and territorial insurance regulators prescribe the

document that is to be used to prove this coverage. That document is often referred to as a motor

vehicle liability insurance card or a financial responsibility card.

In most Canadian provinces and all Canadian territories, the “pink card” is the required form of

insurance card. The pink card arose out of a decision of the Council of Canadian Insurance

Regulators. 1

In the early 1960s, the Council decided that a standard form insurance card would

be in the interest of all provinces. A standard form would allow a province’s police officers to

more easily identify valid insurance cards for drivers from other provinces. As a result, the

Council adopted the familiar pink card.2

The pink card is not used in Quebec, British Columbia, Manitoba and Saskatchewan.

In the western provinces, residents receive the required minimum motor vehicle

insurance coverage through a provincial crown corporation rather than private sector

insurers. Under this regime, there is no pink card and motor vehicle registration and

liability insurance are combined.

The pink card is also not used in Quebec. Although Quebec insurance providers must

provide an insurance certificate that contains prescribed content (i.e., by section 97 of the

Automobile Insurance Act (Quebec)), there is no mandatory colour for this document.

More significantly, this document can be sent by e-mail. In this regard, Quebec is the

first jurisdiction in Canada to embrace a modern approach.

1 Our understanding is based on discussions with a representative of the Alberta Ministry of Treasury Board and

Finance, and confirmed by discussions with a representative of the Financial Services Commission of Ontario. 2 Despite extensive efforts, specific Council or regulator documents from the 1960s (wherein the colour and size

requirements were set out and formally approved) have proven elusive. To date, only oblique references to an

approved standard form appear in the bulletins, gazettes and similar documents issued by regulators and

provinces. For example, see the comments of the Ontario Superintendent of Financial Services (Interim) in the

attached jurisdictional summary.

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2. Original, Paper Pink Card

In each of the pink card provinces and territories, the basic requirement for an insurance card is

set out in legislation. However, that legislation defers to the applicable provincial or territorial

regulator to determine the form of the card.

At present, most of the regulators of the pink card provinces and territories do not clearly specify

in their official bulletins or notices that an original paper card is the exclusive format (only

Alberta is clear on this point, requiring paper cards). However, representatives of these

regulators confirmed that the original paper card is nonetheless required.

Many consumers are unaware that a photocopy of an insurance card is not valid evidence of

insurance coverage in these jurisdictions. Not having the original paper pink card in the vehicle

is technically an offence, although some police officers exercise discretion in enforcing that

requirement.

Note, however, that facilitating change to this more than 50-year-old regime lies largely with

provincial regulators, without the need for statutory amendment. The relevant legislation in each

province and territory using the pink card does not itself expressly require that the insurance card

be in paper form, and the legislation defers to the regulator to set the form of the card. In our

view, provincial and territorial insurance regulators could therefore permit the electronic delivery

of an insurance card, and beyond that, could permit the use of electronic images of insurance

cards to suffice.

3. Issue of Fraud

Over the past 10 years, modernization of the pink card regime has been proposed from time to

time in the course of various reviews of automobile insurance regimes. In Ontario, the

Superintendent’s 2009 Report on the Five Year Review of Automobile Insurance to the Minister

of Finance3, the Superintendent indicated that the “primary concern regarding electronic

commerce is the production of fraudulent liability cards”. The report also noted that “fraudulent

paper liability cards currently exist and that technological solutions may exist to address these

concerns.”

However, citing fraud as a basis to rely on a paper card, seems incongruous with current

technology. Specifically:

Technological solutions exist which can securely deliver authentic insurance cards by

electronic means.

Bad actors can create or use a false insurance card regardless of whether the insurance

card is in paper or electronic form, and without any appreciable difference in difficulty as

between a paper or electronic form.

3 https://www.fsco.gov.on.ca/en/auto/5yr-review/Documents/FiveYearReviewReport.pdf [March 31, 2009].

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It is relatively easy for bad actors to make use of an invalid insurance card (e.g., one for

which the underlying insurance has been cancelled) regardless of its form. Police officers

inevitably accept paper insurance cards that appear valid and unexpired.

There is no technological solution that police officers can use in the field to verify current

proof of insurance coverage. At best, officers may be able to access provincial databases

that indicate whether the vehicle was insured at the time of vehicle registration or

renewal. This stale information is not particularly helpful in detecting fraudulent paper

liability cards.

All police agencies consulted in connection with this advisory report4 suggested that if an

officer doubted proof of valid insurance, a call to the insurance company would be the

easiest way to verify the claim (an approach that seems to be taken regardless of whether

the insurance is Canadian or U.S.).

Given this, it is difficult to see how fraud prevention can continue to justify the original paper

card requirement to the exclusion of an electronic card.

4. The U.S. Experience

The Canadian experience with respect to the pink cards is in sharp contrast with the regime now

prevailing in the United States. According to the Property Casualty Insurers Association of

America (PCIAA), 43 U.S. states have enacted e-card legislation which permits some form of

electronic proof of motor vehicle insurance coverage5 – permitting electronic delivery of

insurance cards and, in many cases, also permitting drivers to use an electronic image (e.g., on a

smartphone screen) to evidence coverage. The PCIAA notes the enactment of e-card legislation

as a recent phenomenon: “In 2011, no states allowed drivers to use their cell phone to show proof

of insurance in a traffic stop and today more than three-fourths of the states have enacted laws or

adopted regulations [to facilitate electronic proof of insurance coverage].”6

While the decision of many U.S. states to adopt e-card legislation has been well received, some

concerns have been raised with respect to privacy and liability.

On the issue of privacy, it is common for individuals to store a variety of personal information on

their mobile devices. Concerns have been raised regarding a police officer’s ability to access

such information while that officer is in possession of the mobile device in the course of

verifying the proof of insurance. To address this concern, many U.S. states have included

provisions in their e-card legislation that limit a police officer’s ability to access information

stored on a mobile device other than the information contained on the e-card.7

4 The Royal Canadian Mounted Police, the Ontario Provincial Police, the Toronto City Police, and the Calgary

Police. 5 http://www.pciaa.net/pciwebsite/cms/content/viewpage?sitePageId=41443 [“E-Card and Anti-Fraud Measures

Become Law in New Jersey”, May 11, 2015] 6 http://www.pciaa.net/industry-issues/e-commerce [“Policymakers Take Positive Steps in 2015 to Modernize

Insurance Laws”] 7 For example, New Jersey included the following provision in its e-card legislation: “The use of a cellular

telephone, tablet, computer, or any other electronic device to display proof of insurance does not constitute

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With respect to liability, concerns were raised with respect to a peace officer’s liability should a

mobile device be damaged in the process of verifying proof of insurance. To address this

concern, it appears that many U.S. states8 have included provisions in their e-card amendments

that shield a peace officer from such liability.9 Some U.S. states have attempted to strike a

balance by qualifying this immunity: the immunity from liability for damage exists only where

the police officer exercises due care when handling the device10

or where the police officer has

taken some intentional or reckless action that results in damage.11

Taking the issue of liability one step further, the Texas Legislature chose to remove doubt as to

whether a telecommunications carrier is liable in the event that a wireless communication device

fails to display the required information to provide proof of insurance, rendering carriers immune

if the device is not able to remotely access the information.12

Clearly, the U.S. experience is instructive on the degree to which the Canadian provincial and

territorial regimes can be modernized – whether to simply permit electronic delivery of paper

cards, or to go the next step and permit the use of images of those cards on devices.

For an example of an amendment that allows both approaches, and which accounts for many of

the concerns discussed above, see the excerpt from the amendment to the Ohio Revised Code, as

reproduced in Appendix B.

5. Moving Beyond Paper in Canada

While the pink card regime has existed in Canada for decades, it is clear that this paper-based

system needs to be modernized. Although many legal barriers to e-commerce have been

eliminated through provincial e-commerce statutes, this is one example of a lingering

requirement for traditional paper documents that continues to hamper the insurance sector. As

consumers and other industries rely more heavily on digital means to conduct their affairs, it is

critical that the insurance sector be able to adapt to these changes.

consent for a police officer or judge to access any other contents on the device.” U.S., A. 3905, An Act

concerning motor vehicle insurance identification cards and amending R.S.39:3-29, 216th Leg., Reg. Sess.,NJ,

2014 (enacted). 8 Not all U.S. states that have enacted e-card legislation have provided this liability shield. For example, the

amendment to the Maine Revised Statutes (see below) does not include such a provision. 9 For example, Illinois included the following provision: “Any law enforcement officer, court, or officer of the

court presented with the device shall be immune from any liability resulting from damage to the mobile

electronic device.” U.S., S.B. 1775, An Act concerning transportation, 98th Gen. Assem., Reg Sess., Ill., 2013

(enacted). 10

U.S., S.B. 255, An Act to amend sections 4503.20, 4509.101, 4509.102, 4509.103, and 4509.45 of the Revised

Code to permit a person to present proof of financial responsibility to the Registrar of Motor Vehicles, a peace

officer, a traffic violations bureau, or a court through use of an electronic wireless communications device,

130th Gen. Assem., Reg. Sess., Ohio, 2014 (enacted). 11

U.S., H.F. 307, An Act relating to transportation; commerce; providing for proof of insurance in electronic

format; amending Minnesota Statutes 2014, section 169.791, subdivision 1, 2, 89th Leg., Reg. Sess., Minn.,

2015 (enacted). 12

U.S., S.B. 181, An Act relating to verification of motor vehicle financial responsibility information, 83rd Leg.,

Reg. Sess., Tex., 2013 (enacted).

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Of particular interest is a 2015 study conducted by Forrester Research, Inc. which indicates that

over one third of Canadians interested in digital wallets would store identification cards, which

could include proof of insurance, in such a wallet.13

In order to meet the demands of changing

consumer preferences, and for the insurance sector to keep pace with technological

advancements, it is critical that regulatory bodies become more permissive with respect to e-

commerce solutions.

In advocating for change, it is important to note that change can be achieved by Canadian

provincial and territorial regulators, and without the need for statutory amendment. This is

because the relevant legislation does not itself expressly require that the insurance card be in

paper form, and the legislation defers to each provincial and territorial regulator’s office to set

the form of the card. Therefore, each regulator can extend significant benefits to consumers,

insurers and brokers merely by issuing a bulletin that permits one or both of the following to

serve as proof of coverage:

A printed copy of an insurance card sent via email or similar electronic means (preferably

in black and white, without colour or paper stock requirements); and/or

An electronic copy accessible using a smart phone or similar device for display as needed

(e.g., at a traffic stop, allowing a police officer to view a smart phone screen display) –

this would remove the need for insureds to print a paper copy of the insurance card.

Clearly, the rapid advance of e-commerce will eventually encompass proof of motor vehicle

insurance coverage by electronic means.

13

Source: 2015 market research conducted by Forrester Research, Inc., sampling 3051 Canadians, aged 18 and

older.

Appendix A - Jurisdictional Summary

Province Regulation Regulator Comments

Alberta

Traffic Safety Act, RSA 2000, c T6,

at s. 167

Insurance Act, RSA 2000, c I-3, s.

822

Alberta Treasury Board

and Finance

Bulletin Number 01-2015, “Approved Form of

Financial Responsibility Card [Pink Card]”, dated May

201514

states (emphasis added):

“Consistent with other jurisdictions in Canada, the

Superintendent has approved the form for the [financial

responsibility card (FRC)]. Except as provided below

in the section titled “TEMPORARY FRC”, the FRC:

1. Must contain at least the following information:

a) Insurer’s licensed legal name prominently displayed

b) Policy number

c) Insured’s name

d) Insured vehicle make, model, Vehicle Identification

Number (VIN)

e) Effective and Expiry dates

f) The words “Motor Vehicle Liability Insurance Card

Canada Inter-Province Applicable Within Canada and

the United States of America”;

2. Must be an original document in hard copy on pink

paper, with the provincial and territorial shields in white

in the background (see Appendix 1), and

3. Is not valid unless the referenced automobile

insurance policy is in force.”

14

http://www.finance.alberta.ca/publications/insurance/Superintendent-of-Insurance-Bulletin-01-2015.pdf


New

Brunswick

Motor Vehicle Act, RSNB 1973, c.

M-17, at ss. 28, 279 and 291

Insurance Act, RSNB 1973, c I-12,

at s. 226

New Brunswick

Insurance Board

The Motor Vehicle Act requires the insurance card to be

the one issued by the insurer and in the form approved

by the Registrar. Also, that Act expressly permits a

photocopy of a vehicle registration to be presented to a

peace officer, but does not include a similar permission

in relation to the insurance card. As such, it would be

reasonable to read the requirement relating to the

insurance card as requiring the original card and

excluding a copy (electronic or otherwise). Also, given

the practices in other provinces, and the Alberta bulletin

referenced above, it would be reasonable to interpret the

requirement to involve the original paper insurance card

and not a copy or electronic version.

Newfoundland

Automobile Insurance Act, c. A-22,

at s. 4

Service NL The legislation speaks to a “card” being issued to the

insured by the insurer in the form approved by the

Superintendent of Insurance. Given the context, the

practices in other provinces, and the Alberta bulletin

referenced above, it would be reasonable to interpret the



Nova Scotia

Motor Vehicle Act, RS c. 293, at ss.

204 and 206

Nova Scotia Finance and

Treasury Board

The legislation speaks to a “card” being issued to the

insured by the insurer in the form approved by the

Registrar. The legislation also speaks to additional

card, being a copy of the original card, for each person

who commonly drives the insured vehicle. Given the

context, the practices in other provinces, the Alberta

bulletin referenced above, and the fact that the

legislation implies an “original” card from which copies

are made, it would be reasonable to interpret the




Northwest

Territories

Insurance Act, RSNWT 1988, c I-4,

at s. 125(8)

Finance - Government of

the Northwest Territories

Same general approach as Newfoundland.

Nunavut Insurance Act, RSNWT (Nu) 1988,

c I-4, at s. 125(8)

Finance - Government of

Nunavut


Ontario

Compulsory Automobile Insurance

Act, RSO 1990, c. C25, at s. 3

Financial Services

Commission of Ontario

The Financial Services Commission of Ontario has

released three bulletins since 1993 with respect to the

approved form of the insurance card. The 1993 bulletin

states that the 1993 amendments to the content of the

card do not affect the colour (pink) and the size.

Commission representatives were unable to identify the

original document setting out colour and size

requirements. Brian Mills, CEO and Superintendent of

Financial Services (Interim) on May 6, 2015: “Bulletin

No. A-18/93 states that the colour of the card is pink

and that the size of the card remains the same.

Originally, the size of the card was designed to fit a

standard wallet. It also closely matched the size of the

vehicle permit issued by the Ministry of Transportation

as well as the driver’s licence at the time, allowing for

the documents to be kept together. While the size of

the card is not explicitly stated in any Bulletins, the

most important requirement of the card is that it must

contain the required text along with the data elements

shown for the specific vehicle and insurance policy.”

Also, section 3 of the Compulsory Automobile

Insurance Act states:

(3)(1) An operator of a motor vehicle on a highway

shall have in the motor vehicle at all times,

(a) an insurance card for the motor vehicle, or


(b) an insurance card evidencing that the operator is

insured under a contract of automobile insurance,

And the operator shall surrender the insurance card for

reasonable inspection upon the demand of a police

officer.

The term “insurance card” is defined to mean “(a) a

Motor Vehicle Liability Insurance Card in the form

approved by the Superintendent”.

Given the context, the practices in other provinces, and

the Alberta bulletin above, it would be reasonable to

interpret the requirement to involve the original paper

insurance card and not a copy or electronic version.

Prince

Edward

Island

Insurance Act, c. I-4, at s. 216 The Department of

Environment, Labour and

Justice


Quebec

Automobile Insurance Act, c. A-25,

at s. 97

Autorité des marchés

financiers

The Automobile Insurance Act does not require

certificates of insurance to be in a form approved by the

Superintendent of Insurance. Instead, section 97 of the

Act sets out the content that is required. According to

representatives of the Autorité des marchés financiers

(and confirmed by a representative at the Groupement

des assureurs automobiles) the certificate can be sent

via email (typically only upon the insured’s request) or

mail, and there is no mandatory colour.

Yukon

Insurance Act, RSY 2002, c. 119, at

s. 132(8)

Professional Licensing &

Regulatory Affairs under

the Department of

Community Affairs


Appendix B - Ohio Revised Code

The underlined provisions reflect the amendments to the Ohio Revised Code15

:

Sec. 4509.101. (G)(1)(a) The registrar, court, traffic violations bureau, or peace officer

may require proof of financial responsibility to be demonstrated by use of a standard

form prescribed by the registrar. If the use of a standard form is not required, a person

may demonstrate proof of financial responsibility under this section by presenting to the

traffic violations bureau, court, registrar, or peace officer any of the following documents

or a copy of the documents:

(i) A financial responsibility identification card as provided in section 4509.103 of

the Revised Code;

(b) A person also may present proof of financial responsibility under this section to the

traffic violations bureau, court, registrar, or peace officer through use of an electronic

wireless communications device as specified under section 4509.103 of the Revised

Code.

[…]

(N)(1) When a person utilizes an electronic wireless communications device to present

proof of financial responsibility, only the evidence of financial responsibility displayed

on the device shall be viewed by the registrar, peace officer, employee or official of the

traffic violations bureau, or the court. No other content of the device shall be viewed for

purposes of obtaining proof of financial responsibility.

(2) When a person provides an electronic wireless communications device to the

registrar, a peace officer, an employee or official of a traffic violations bureau, or the

court, the person assumes the risk of any resulting damage to the device unless the

registrar, peace officer, employee, or official, or court personnel purposely, knowingly, or

recklessly commits an action that results in damage to the device.

Sec. 4509.103. (A) As used in this section and sections 4509.101 and 4509.102 of the

Revised Code, "electronic wireless communications device" includes any of the

following:

(1) A wireless telephone, including a cellular telephone;

(2) A personal digital assistant;

(3) A computer, including a laptop computer, a netbook computer, and a tablet computer;

(4) Any other substantially similar wireless device that is designed or used to

communicate and displays text or images.

15

U.S., H.F. 307, An Act relating to transportation; commerce; providing for proof of insurance in electronic

format; amending Minnesota Statutes 2014, section 169.791, subdivision 1, 2, 89th Leg., Reg. Sess., Minn.,

2015 (enacted).

CSIO eSlips Advisory Report: E-Delivery of Motor Vehicle Insurance Cards

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