Ontario's insurance regulator has once again sent out a fresh warning to drivers that some Guaranteed Asset Protection (GAP) coverage sold at dealerships may come from unlicensed sellers, leaving claims unpaid. The Financial Services Regulatory Authority of Ontario (FSRA) said the alert covers unlicensed sales of GAP insurance that may leave some drivers without the coverage they expected.
The July notice spells out how the product works: if $30,000 remains on a vehicle loan and the insurer determines the actual cash value is $24,000, GAP coverage is meant to cover the resulting $6,000 shortfall.
"Roughly three-quarters of car buyers lease or finance their vehicles and they may be offered coverage that could leave them exposed," said Jordan Solway, FSRA's executive vice president, property and casualty insurance. "Consumers have paid hundreds of dollars for this coverage and expect to be protected, but their policies may not be valid, and claims may not be honoured."
FSRA said some products are deliberately presented as something other than insurance to avoid regulatory requirements - citing coverage marketed at dealerships as a "loyalty program" offering a credit toward another vehicle if the original is stolen or written off.
Calling the product a loyalty program, the regulator said, does not exempt it from the Insurance Act. "Buying a vehicle is expensive and the process can be complex," Solway said. "Consumers should take time to fully review any coverage they are offered and should only purchase GAP insurance products from a licensed insurer, agent, or broker in Ontario."
The notice follows a documented enforcement chain involving Assureway Protection Corporation, which FSRA first flagged publicly on February 26. The regulator said Assureway Protection was not, and never had been, a licensed insurance company and was not authorized to engage in the insurance business in Ontario, meaning any existing or future policies and claims might not be honoured.
On March 3, FSRA issued a notice of proposal to penalize the firm. Reports indicated that the FSRA had received numerous complaints from consumers asserting that claims on their GAP products with Assureway Protection were being ignored, denied, or deemed invalid, including complaints from consumers in other provinces. The notice stated Assureway Protection was created in 2022 and assumed the business of AssureWay Insurance, and that Lloyd's never underwrote any Assureway Protection GAP product. FSRA accused the company of misrepresenting that its products were underwritten by Lloyd's when they were not.
By April, FSRA had imposed compliance orders against Assureway Protection and its sole officer and director, Shiraz Hussain, finding they had contravened the Insurance Act by carrying on business as an insurer without a licence and by engaging in an unfair or deceptive act or practice. "FSRA will not tolerate conduct that places consumers at risk or undermines confidence in Ontario's insurance market," said Elissa Sinha, director of litigation and enforcement at FSRA, adding that the compliance order protects consumers, requires corrective steps, and reinforces that past undertakings and regulatory commitments must be respected.
Alberta's Superintendent of Insurance issued its own warning April 20, directing Assureway to stop offering its "TrueGap Membership Program" after finding it was not, and had never been, licensed under Alberta's Insurance Act, nor underwritten by a licensed Alberta insurer.
New Brunswick's Financial and Consumer Services Commission followed, warning residents after Consumer Advocate for Insurance staff heard from New Brunswickers who said they were having difficulty contacting Assureway about insurance products they had already paid for. That notice disclosed a critical detail absent from the earlier Ontario and Alberta alerts: Assureway Protection Corporation appears to have been dissolved by the federal government on June 25, 2025, for failing to meet legal requirements - meaning the company was already defunct when regulators began warning consumers about it.
That timeline is worth sitting with: Ontario, Alberta, and New Brunswick each issued consumer warnings between February and this month without knowing, or at least without stating, that the company at the centre of them no longer legally existed. For any consumer still holding an Assureway GAP product, that gap in regulatory knowledge is now the practical reality behind the warning - there is no dissolved corporation left to pay a claim, regardless of what any individual policy document promised.
