Ontario’s financial services regulator has released a set of proposed guidelines aimed at establishing clear criteria for obtaining a life insurance agent license in the province.
The new document comes in response to discrepancies uncovered in two compliance reports released by the Financial Services Regulatory Authority of Ontario (FSRA) last month.
These reports highlighted “troubling” agent practices related to recruitment, training, and conduct, with the FSRA identifying several instances of agents selling universal life insurance policies without regard to the customers’ needs or circumstances.
In a news release, the regulator said its proposed guidance aims to correct these practices by “providing a reference for applicants and agents to understand how past and current conduct may affect their suitability to hold a life insurance agent license.”
Huston Loke, executive vice president of market conduct, described the move as a way to improve consumer protections and ensure that Ontarians “get life insurance that is right for them today and well into the future.”
“We have seen some troubling practices in the life insurance sector, and we believe this guidance will help improve the conduct of professionals who Ontarians trust to provide sound life insurance advice,” Loke added.
Interest parties may review the proposed guidance and submit feedback via the FSRA’s website. The consultation period is now open and will conclude on February 9, 2024.
The FSRA developed its proposed guidance for licensing suitability requirements as part of a six-point action plan to address significant deficiencies in agent training, supervision, sales of unsuitable products, and recruitment and compensation models that may lead to customer exploitation.
