ID
2023-015
ID
2023-015
Type
Policy
Sector
Life and Health Insurance
Status
Public comment closed
Date
Comment Due Date
Thank you for providing your feedback on FSRA’s proposed Guidance on Life Insurance Agent & MGA Licensing Suitability.
The request for submissions is now closed.
We appreciate the comments and questions received to date and look forward to sharing with you the final Guidance. Stay up to date on Guidance releases on our newsroom. Follow us on LinkedIn and subscribe to our mailing list for quick updates.
To better protect consumers, the Financial Services Regulatory Authority of Ontario (FSRA) has proposed Guidance that clearly sets out the requirements to be suitable to hold a life insurance agent licence in Ontario.
FSRA wants to ensure all life agents, including managing general agencies (MGAs), have the skills necessary to be licensed and will comply with the law, treat customers fairly and adhere to all legal and regulatory obligations.
The proposed Guidance provides a reference for applicants and agents to understand how past and current conduct may affect their suitability to hold a life insurance agent licence. It also reiterates oversight responsibilities for life insurance companies.
FSRA’s six-point action plan
FSRA is releasing this proposed Guidance as part of its six-point action plan to correct troubling business practices in the life insurance sector. FSRA’s supervisory reviews have found gaps and a lack of clarity relating to the roles and responsibilities shared among insurers, MGAs, and independent agents. This includes a lack of agent training and supervision, unsuitable product sales, and agent recruitment and compensation models that may lead to the unfair treatment of customers.
The six-point action plan sets out an enhanced approach to sector supervision, a new regulatory framework, industry guidance, enforcement, whistleblower protection, and a consumer education campaign.
FSRA continues to take action to strengthen the regulatory framework for MGAs and other intermediaries that distribute life insurance products. This includes, but is not limited to, the implementation of a new proposed Rule which would introduce new requirements and duties relating to developing compliance monitoring systems and overseeing the conduct of life insurance agents. FSRA plans to consult on a draft Rule in the coming months. In addition, FSRA has heard directly from stakeholders that additional options should be considered to strengthen the regulatory framework. For example, some stakeholders have suggested the creation of a new licensing class with specific requirements and obligations.
The consultation period for proposed guidance on Life Insurance Agent & MGA Licensing Suitability is now open and will close on February 9, 2024.
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