The Financial Services Regulatory Authority (FSRA) is committed to protecting life and health (L&H) insurance consumers in Ontario. We license and regulate individuals and corporations that distribute L&H insurance, including managing general agencies (MGAs).

FSRA does not tolerate any activities that may harm consumers or the industry. We will take appropriate action if a licence-holder is not complying with the law or is engaging in unfair or deceptive acts or practices which do not put consumers’ interests first.

In September 2022, FSRA published observations from a cooperative thematic review of three managing general agencies. We found gaps which raised questions about whether insurers and MGAs were adequately monitoring and supervising their agents to ensure fair treatment of customers.

The findings also raised concerns about whether insurers have reasonable compliance systems in place to ensure MGAs and their agents adequately perform duties delegated to them.

As a result, FSRA has taken enforcement action to address the concerns identified in the cooperative thematic reviews. We have heard from industry members who supported this swift approach to addressing the review findings and protecting the sector’s reputation.

FSRA’s authority to review MGAs

MGAs must be licensed by FSRA as life insurance agents or as a corporate agency if they engage in any activities that require a licence under the Act, including receiving commissions paid for the sales of insurance.

FSRA has authority to review licence-holders engaging in or suspected of engaging in unfair or deceptive acts or practices which do not put consumers’ interests first.

  • FSRA has the authority under section 442.1 of the Insurance Act (the Act) to direct inquiries to MGAs as licensed entities.
  • FSRA also has the authority to direct inquiries against any person who FSRA believes may have committed an unfair or deceptive act or practice.
  • FSRA also has the authority under section 443 of the Act to examine persons who hold licences under the Act. This authority includes examining MGAs which are licensed under the Act.
  • FSRA may also issue a summons under section 444.1 of the Act against any individual when FSRA believes it is necessary to determine if the MGA is complying with the Act.
  • FSRA has broad authority to determine matters which are relevant to whether anyone, including an MGA, is suitable to be licensed under s. 392.4(1) of the Act.
  • In addition, Ontario Regulation 347/04 under the Act (the “Agents Regulation”) permits FSRA to take action against a licensee who is not suitable to hold a license, including where the licence-holder “has demonstrated incompetence or untrustworthiness to transact the insurance agency business.”

Any individuals or corporations, including MGAs, licensed with FSRA must comply with the law.

FSRA may take enforcement action if necessary.

Taking action to protect consumers

If FSRA believes, on reasonable grounds, that an MGA is not suitable to be licensed, FSRA may refuse, revoke, suspend, or impose conditions on the MGA’s licence. Where applicable, FSRA may also seek to impose monetary penalties of up to $200,000 for a corporation.

FSRA will continue to supervise and take action to ensure licence-holders are complying with the Act, the regulations and their licence obligations. This helps protect the rights and interests of consumers so they have confidence in Ontario’s financial services sector.

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