Advisory: ING Aeroplan “Bonus” Point Program

October 24, 2006


On behalf of the Council of RIBO, I am writing to advise each office of a development regarding one aspect of a marketing program undertaken by ING in concert with Aeroplan. Marketing materials already forwarded to brokerages across Ontario contain an element that could potentially involve brokers in offering an inducement to customers to obtain insurance policies through them with ING. The use of any payment, allowance or gift or any offer to pay, allow or give, directly or indirectly, any money or thing of value as an inducement to any prospective insured to insure, is a defined act of misconduct under RIBO regulations.

RIBO’s published Marketing Guidelines make it clear that there is no problem with obtaining air miles based on the payment of premium dollars for insurance policies. Upon review, however, RIBO has consistently held that the addition or offer of “bonus” miles as a reward for purchasing a policy of insurance is considered to be an inducement. In this instance, the ING program includes a marketing feature that provides the offer of a reward of 500 air miles, available only upon purchasing a policy as new business, or upon renewal of existing business and enrollment in the program.

The “reward” aspect of this program was referred to RIBO by ING for consideration on September 19, 2006 for presentation to the Professional Development Committee at its next meeting on October 17, 2006. On October 17, the Professional Development Committee and subsequently the entire Council of RIBO considered the issue and decided that the “reward” aspect, or the “thank you for enrolling in the program” aspect constituted an inducement. ING was notified of this decision, along with Council’s reasoning later that same day.

RIBO then learned, on October 20, that marketing material, including the inducement, had been forwarded to Ontario brokers sometime the week prior to the decision being rendered and communicated to ING. Also, on October 20, however, ING indicated to RIBO that, as part of their continued dealings with RIBO in good faith on this issue, it is their intention to immediately comply with the decision of the RIBO Council and to take steps to remove the reward aspect of the program. ING anticipates it will take two weeks to change external websites and systems to eliminate the “500 point thank you for enrollment”. They also anticipate it will take two weeks to re-program their internal systems, and up to a month to amend and replace marketing materials.

RIBO Council applauds ING’s actions and appreciates their cooperation. However, in the interim until that aspect of the program has been restructured, all brokers should be aware of their potential exposure to misconduct proceedings if RIBO receives any complaints regarding the use of an inducement to any prospective insured to insure, in this instance, through marketing the offer of reward points.

Kindly govern yourselves accordingly. On behalf of the Council of RIBO, thank you very much for your anticipated cooperation.

Yours truly,
Jeffrey A. Bear, B.A., LL.B., LL.M.
Chief Executive Officer