Jelena Pejic, director of licensing at FSRA, said during the webinar that such behaviors can be brought to the attention of the regulator during the licensing process, which includes questions on these subjects that must be answered “in full”.
In response to questions about bankruptcies in particular, “FSRA seeks to understand” any past insolvency or bankruptcy, she assured. “This includes bankruptcies that have been fully discharged or consumer proposals that have been fully executed. “
FSRA also wants to know about ongoing insolvency cases – for example, “when someone has filed for bankruptcy and is following the steps of the procedure,” continued Jelena Pejic.
Disclosing information about bankruptcies and insolvencies in the license application form does not necessarily mean the application will be refused, she said. Rather, “it means that FSRA will be able to adequately assess your suitability to be licensed and assess the risks associated with that suitability and address them appropriately.”
The guidance includes several key factors for assessing misconduct and fitness, such as repeatability against a reformed model of behavior.
Asked about the next steps if agents are deemed unsuitable, the regulator first indicated that during the application process, the information submitted is reviewed and assessed, which includes gathering additional information if necessary.
After this review, if FSRA determines that an agent or applicant is not suitable, the regulator “moves towards refusing the application,” explained Jelena Pejic, “and there are a number of options “.
For example, FSRA may offer the applicant the opportunity to withdraw the application “before FSRA takes formal action against the application,” she reported.
In other cases, FSRA may deny the application, by first issuing a notice of proposed denial and providing it to the applicant, who may then request a hearing to appeal the denial.
When the regulator was asked whether the guidance distinguished between sponsored and unsponsored agents, Jelena Pejic said it did not. “The process we use to assess an agent’s suitability will be the same whether the agent is sponsored or not,” she assured.
The guidance also reiterates the supervisory responsibilities of life insurers. In response to a question about the implications for insurers who sponsor candidates who may not be suitable, Jelena Pejic said FSRA wants insurers to have procedures for selecting and vetting life insurance agents.
In cases where the insurer has sponsored an agent deemed unsuitable, FSRA will copy the insurer’s communications with the license holder, she explained. In addition, “the ARSF will seek to dialogue with the insurer to understand the measures it has taken to verify and certify that the agent is fit to practice,” she detailed, and these discussions will be in-depth if necessary.
The regulator was also asked why general insurance agents are being identified in the guidelines for the first time in Ontario, rather than in the Insurance Act. The regulator cited transparency in licensing requirements as well as a potential new rule for AGs.
“We are looking to expand and strengthen the regulatory framework for insurance general agents,” said Tim Miflin, senior director of insurance policy at FSRA. Later, FSRA will consult on a potential new rule targeting AGs, he said.
The consultation on the proposed directions will continue until February 9.
2024-01-23 12:21:37
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