A new report by Ontario’s Financial Services Regulatory Authority (FSRA) has revealed concerning practices within the life and health insurance industry, urging insurers to take stronger measures to protect consumers. FSRA’s review of 319 life agents from 2022 to 2024 highlighted ongoing issues with agent misconduct.
The review, conducted under FSRA’s Life Agent Misconduct Report (LAMR) and proactive supervision programs, examined agent behaviours that posed risks to consumer interests. FSRA’s executive vice president of market conduct, Huston Loke, emphasized that while the 319 agents reviewed represent only a portion of the industry, the findings raise significant concerns.
“Some of their behaviours raise consumer protection concerns,” Loke stated. “We strongly encourage insurers to review their compliance systems and ensure their agents are selling insurance products that meet their clients’ needs.”
Key findings from the review revealed multiple agent misbehaviours, including:
In response to these issues, FSRA took several actions. It issued 57 business practice letters, escalated 55 cases for further investigation, and closed 15 cases with no concerns. However, FSRA made it clear that insurers are responsible for their agents’ conduct, including those contracted with distribution partners. The regulator urged insurers to ensure that customer interests are prioritized and that agents comply with all relevant regulations.
The report also highlighted FSRA’s ongoing efforts to educate consumers about their rights, address complaints, and take necessary regulatory action when noncompliance is detected. FSRA’s approach focuses on the highest-risk agents and insurers, with the goal of safeguarding consumers from unsuitable insurance products and unethical practices.
Notably, FSRA said it has seen an increase in the number of LAMRs submitted through its online portal, with 123 reports in 2022-23 and 144 in 2023-24.
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