Summary of stakeholder comments – FSRA’s proposed approach to strengthening protection of vulnerable consumers

To what extent does this topic require more attention from FSRA?

Stakeholders generally supported greater attention from FSRA on the topic of vulnerable consumers.

Stakeholders pointed out that the approach must consider the distinct ways in which various demographic groups might experience vulnerability.

Stakeholders in the pension sector believed that further attention was not required as the notion of vulnerability applied differently to their sector. Some suggested that the focus should be on general awareness and education about pensions.

Some stakeholders in the property & casualty insurance sector suggested that existing legal and regulatory frameworks are sufficient in ensuring protection of vulnerable consumers thus further action is not required.

The majority of stakeholder feedback validated FSRA’s initial view that further work is required to strengthen protection of vulnerable consumers.

However, FSRA acknowledges that stakeholders have expressed varying views about the issue. The Vulnerability Framework does not change or add to existing legal and regulatory frameworks. In addition and in response to pensions sector stakeholders, for the pensions sector the Framework should be understood as confined only to FSRA’s activities that promote public education and knowledge about vulnerable pension plan members and beneficiaries.

In addition to the activities proposed in the chart under Section A of the Proposed Approach to Strengthening Protection of Vulnerable Consumers, are there any additional activities, such as outlining a set of expectations or defining specific requirements for entities across all of its regulated sectors, that FSRA should consider for its approach to strengthening protection of vulnerable consumers?

Activities recommended by stakeholders include: research that could benchmark consumer sentiments to track the experiences of vulnerable consumers; the broader use of plain language documents to make any complex documents more accessible; and, targeted outreach to vulnerable consumers.

FSRA has integrated stakeholder ideas for activities to strengthen protection of vulnerable consumers into the Vulnerability Framework. It includes fostering evidence-based regulation and supervision, including through the biennial cross-sectoral survey that benchmarks consumer sentiments and experiences. The Framework also emphasizes the importance of improving consumer education, engagement, and awareness to build confidence and knowledge about the regulated sectors amongst vulnerable consumers.

Do you have any comments on FSRA’s proposed approach to defining vulnerable consumers in Section B of the Proposed Approach to Strengthening Protection of Vulnerable Consumers? Do you think it is useful to have a definition of vulnerable consumers? Are there any other factors that FSRA should consider in better understanding vulnerability in its sectors?

Stakeholders suggested adding further clarity to the definition of vulnerable consumer. They agreed that it was useful to have a definition that is both broad and flexible that could adapt to market changes or innovations in the market. Some noted that it was important to consider the transient and evolving nature of vulnerability. Others urged consistency across other provincial and national regulators.

FSRA agrees that the definition should be broad and flexible, while providing a basis for determining and addressing vulnerabilities in FSRA’s regulated sectors.

FSRA has revised its definition based on stakeholder feedback. The revisions enhance clarity by incorporating specific factors that can elevate the risk of individuals experiencing vulnerability (such as health, social, economic factors, as well as major life events). Additionally, FSRA’s newly established segmentation tool for measuring vulnerability supports the definition by providing an extensive list of factors that can impact an individual’s risk of experiencing vulnerability.

FSRA is not introducing new requirements for regulated entities through this guidance. We agree with stakeholder comments in support of consistency and harmonization amongst regulators and will actively engage with our regulatory counterparts bilaterally and through national regulatory associations to build knowledge on leading practices and reduce risk of redundancy or duplication of resources.

If you are a consumer or consumer advocate, what should FSRA know about the experiences of vulnerable consumers?

Consumers and consumer advocates raised language barriers, environmental events, and biases faced by certain groups as some of the challenges experienced by vulnerable consumers.

FSRA acknowledges the challenges faced by vulnerable consumers in its regulated sectors, as highlighted by both consumers and consumer advocacy groups. FSRA has considered these challenges in establishing its segmentation tool for measuring vulnerability. For example, the segmentation tool introduces climate-related events as a new marker of vulnerability.

The segmentation tool also introduces additional considerations that could help explain financial vulnerability, such as English as a second language or recent immigration status.

Do you have suggestions for particular vulnerable communities or public interest groups representing vulnerable consumers that FSRA should directly engage with?

Stakeholders provided a range of suggestions for public interest groups and organizations that FSRA should consider engaging with in its efforts to strengthen protection of vulnerable consumers.

Stakeholders identified more than ten groups for further outreach from FSRA. The groups included industry bodies, other government organizations, and advocacy organizations representing communities that could be more likely to be vulnerable.

FSRA will reach out to the organizations referenced in the stakeholder submissions.

As part of the Vulnerability Framework, FSRA has committed to strengthening engagement with vulnerable communities and public interest communities to strengthen FSRA’s understanding of issues affecting vulnerable consumers, and to inform them about FSRA’s role as the regulator.

What additional information, (such as leading practices, tools, opportunities or risks) should FSRA be considering to inform its approach?

Stakeholders recommended that FSRA’s final strategy should be consistent and complementary to FSRA’s other initiatives without creating a significant regulatory burden for regulated entities. Some stakeholders have suggested aligning with and building on other principles and guidance that are in place to ensure fair treatment of consumers.

The Vulnerability Framework does not create any new requirements for regulated entities and is complementary to other FSRA initiatives related to vulnerable consumers.

FSRA considered the regulatory efforts and the best practices in other jurisdictions on the protection of vulnerable consumers in developing the Framework. Similar to the United Kingdom’s Financial Conduct Authority, FSRA’s segmentation tool for measuring vulnerability considers several dynamic factors and circumstances that can impact an individual’s risk of experiencing vulnerability.