On April 1, 2025, the British Columbia Financial Services Authority (BCFSA) released Advisory No. 25-011: 2025/26 Regulatory Roadmap (the Roadmap). The Roadmap outlines the BCFSA's priorities for insurers, credit unions, trust companies, pension plans, money service businesses and other financial service sector participants over the next three fiscal years.
The BCFSA focused on the following areas in developing its priorities for insurers for 2024/2025: (i) Regulatory Framework Modernization; (ii) Digitalization Risk; and (iii) Natural Catastrophes and Climate Risk, as discussed in greater detail below.
In this regard, the BCFSA:
- Implemented the Insurer Code of Market Conduct (the Code), effective April 1, 2024.
- Hosted a tabletop exercise with stakeholders to simulate the impact of a major earthquake in British Columbia.
- Consulted on and published the Information Security Incident Reporting Guideline for Extraprovincial Insurance Corporations and Extraprovincial Trust Corporations (the IS Guideline).
Regulatory framework modernization
Insurer code of market conduct - Surveys
Insurers carrying on business in British Columbia were expected to adopt the Code as of April 1, 2024. The BCFSA will survey authorized insurers in British Columbia in 2025 to assess whether insurers have adopted the principles of the Code into existing business processes and procedures. The results of these surveys will inform market conduct supervisory activities of the BCFSA, and may result in the introduction of additional market conduct guidelines. Survey results will also be published on a consolidated and anonymized basis.
Guidance
The BCFSA indicates that it will continue to adopt guidelines from the Office of the Superintendent of Financial Institutions (OSFI), as appropriate, as well as guidance from the Canadian Council of Insurance Regulators (CCIR).
New market conduct supervisory approach
The BCFSA also intends to revamp its approach to market conduct supervision of insurers, indicating that the approach will be more "forward looking" and allow the BCFSA to be more proactive with regulation, and to enhance transparency and predictability of regulatory priorities. We anticipate that insurers in British Columbia can expect to be in communication with the BCFSA more often, and for the supervisory approach to be thematic, similar to the shift observed with OSFI's new supervisory framework in 2024.
Digitalization risk
The BCFSA continues to monitor risks relating to digitalization and is engaging with regulatory and government counterparts to address technology risks.
Information security incident reporting
Material information security incidents must be reported in a timely manner. The BCFSA released the draft IS Guideline for public consultation in June 2024. Once finalized and implemented, the requirements set out in the IS Guideline would apply to extraprovincial insurance corporations. The BCFSA intends to implement these requirements in early 2026. Insurers should review the IS Guideline well in advance of the implementation date to ensure compliance with the requirements therein.
Artificial intelligence guideline
The BCFSA recognizes that the use of artificial intelligence (AI) by insurance industry participants has increased significantly. The BCFSA intends to release draft AI guidance for public consultation in 2026/27 which will consider innovation and responsible use of AI.
Natural catastrophes and climate risk
The BCFSA formally began consulting on climate-related risks in July 2023, with the release of its Discussion Paper entitled "Natural Catastrophes and Climate-Related Risks: Managing Uncertainty and Building Resilience in the B.C. Financial Services Sector." Since then, the BCFSA has continued to consider next steps to manage natural catastrophe and climate-related risks. The BCFSA has stated that it intends to leverage OSFI Guideline B-15: Climate Risk Management and publish its own guideline for consultation in 2026/27.
Conclusion
In short, insurers carrying on business in British Columbia can expect to have more dialogue and communication with the BCFSA over the next three years. This comes at a time when there is no shortage of surveys, questionnaires or other requests for information from OSFI and the other provincial insurance regulators. The BCFSA intends to implement guidance in the near term in respect of Information Security Incident Reporting, and, in future, artificial intelligence. The BCFSA may also introduce additional market conduct guidance applicable to insurers authorized in the province.
In addition to continuing to monitor the BCFSA's website for updates on public consultations, we recommend that insurers review their existing business practices and policies with an emphasis on market conduct and the fair treatment of customers. This may include internal audits as well as external audits of intermediaries and other strategic partners.
About Dentons
Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Specific Questions relating to this article should be addressed directly to the author.
