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After a contentious policy development process, the Canadian Life and Health Insurance Association (CLHIA) is scrapping planned guidance to enhance compensation disclosure in the group benefits and retirement services businesses.

The CLHIA announced on Friday that it is withdrawing new guidance (Guideline G19 on Compensation Disclosure in Group Benefits and Group Retirement Services) that was set to take effect on July 1 for new group retirement contracts, and to be phased in over the next couple of years in other areas.

“Following extensive discussions with market players, including advisors and their associations, and careful consideration of what we heard, we have decided to withdraw this industry guideline,” said Stephen Frank, president and CEO of the CLHIA, in a statement announcing the move.

The decision to withdraw the guideline, which is effective immediately, puts an end to an effort to improve transparency in the group benefits sector that faced resistance within the industry.

Under the new guidelines, advisors would have been required to disclose all direct compensation in both dollar and percentage terms; to disclose their eligibility for indirect compensation; and to disclose in-kind compensation when it exceeded $5,000 per advisor per year.

“Our industry is still strongly in favour of market transparency and plans to work closely with regulators and other stakeholders on these matters going forward,” Frank added.