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Protecting consumers from unlicensed agent activity

FSRA issues licences to insurers and agents to ensure suitable individuals and businesses sell or provide financial products and services to the public. This helps to instill confidence in the sector and protects consumers from harm.

Maintaining this standard is a shared responsibility between FSRA and the industry.

Concerning trend in unlicensed activity

FSRA has recently seen a concerning trend where many insurance agents are completing hundreds of transactions without an active licence.

Some insurers have self-reported these cases to FSRA and corrective action has been taken. In these cases, unlicensed activity occurred because of a lack of proper controls in systems, processes or administration.

There is a real risk of consumer harm if insurance agents disregard the law and forget or knowingly fail to renew their licence in time. For example, invalid policies, cancellations, misrepresentation, or damage to their insurance history, ultimately leading to higher costs.

Next steps

FSRA strongly encourages all insurers to proactively assess and regularly monitor their internal controls to ensure they are robust enough to detect and prevent unlicensed activity.

If unlicensed activity is identified, insurers must report it to FSRA and also take immediate corrective action to protect the affected clients.

To report unlicensed activity resulting due to a lack of or inadequate internal controls, email [email protected].

FSRA will use these emailed reports to monitor this trend, which will inform future regulatory decisions to protect consumers.

Note for life and health insurers only: For all other cases of unlicensed life agent activity, please use the Life Agent Misconduct Report.

Learn more:

FSRA continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone.

Learn more at www.fsrao.ca.

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