The insurance industry is pushing back on proposed new rules on advisor titles in Ontario that would not include basic life agent licensing as adequate for reps to call themselves “financial advisors.”
In a submission to the Ontario government ahead of its next budget, industry trade group, the Canadian Life and Health Insurance Association (CLHIA), is calling on the government to reconsider provisions of new title regulation in Ontario that aim to set minimum standards for reps that hold themselves out as either “financial advisors” or “financial planners.”
Among other things, the minimum standards proposed by the Financial Services Regulatory Authority of Ontario (FSRA) deem that simply achieving the basic life agent licensing requirements — the Harmonized Life License Qualification Program (HLLQP) — does not meet the standard for using the “financial advisor” title (the “planner” requirements are more stringent, so it wouldn’t meet those criteria either).
In its submission, the CLHIA said, that while it supports the objectives of the new rules, “we are concerned that it adds an unnecessary regulatory burden on those who hold life licenses.”
“Completing the HLLPQ and maintaining a life license indicates a level of knowledge that meets or exceeds the baseline competency of someone who calls themselves a ‘financial advisor’,” it argued.
FSRA’s proposed standards are out for comment until Nov. 12.
In the same submission, the CLHIA recommends that the government cut, and eventually eliminate, taxes on life and health insurance premiums and to match federal efforts to allow new types of annuities to be used.
As well, the group calls on the province to encourage greater retirement savings by allowing the use of automatic enrollment options in workplace savings plans.
“Automatic solutions – which include automatic plan participation at a pre-set (or starter) contribution rate, automatic annual contribution increases, and automatic investment in a default investment option – have proven to be highly effective in increasing participation in workplace savings plans and the rate of savings in several countries,” it said, noting that this is rare in Canada, primarily due to legislative restrictions.
“We recommend that Ontario enable automatic plan participation to make it easier for Ontarians to achieve lifetime financial security through higher retirement income, improving Ontario’s productivity, competitiveness and health outcomes,” it said.