Rear view of traffic jam with breaklights showing

In 2019, Bernardine Perreira worked with a new client who needed life insurance. “He had a spouse and two children, and so it was important to put insurance in place to look after his family,” recalled the Toronto-based financial advisor.

Ordinary stuff in the life of an advisor. In this case, however, Perreira and her client ran into some extraordinary obstacles. Her client was a trans man who used “he/him” pronouns and a name (not his legal name) that aligned with his gender.

But “as we were going through the application process, we had to use his legal name, which presented as a female name,” said Perreira, a principal with Perreira Wealth Advisory of Raymond James Ltd. The application forms required her client to specify the biological sex he’d been assigned at birth. Nowhere in the application forms was there an option for gender beyond male or female. “We hit the binary brick wall, so to speak,” Perreira said.

The federal government amended the Canadian Human Rights Act in 2017, adding gender identity and gender expression to its list of prohibited grounds of discrimination. Since then, people have the option to designate their gender as “X,” or not specify gender at all, on provincial identification such as driver’s licences and health cards.

In 2019, the Canadian Life and Health Insurance Association released a position statement on “Transgender and Gender X,” stating in part that it “believes that everyone has the right to define the gender by which they most identify with” and that the industry “recognizes that it needs to adapt to the changing environment to ensure that everyone who applies for insurance will be assessed fairly.”

Perreira spoke to her brokerage’s operations team about the need to update its forms to acknowledge more gender categories, and the team was very receptive, she said.

“We dropped asking clients to designate their gender identity on our client forms several years back,” said Peter Kahnert, senior vice-president of corporate communications and marketing with Raymond James, adding that clients may indicate their preferred honorific if they wish.

Assessing whether the insurance industry is embracing a broader view of gender, however, is difficult. Investment Executive reached out to several major insurers to ask them about their policies and procedures for transgender and non-binary clients.

In an emailed statement, Norm Leblond, vice-president, chief underwriter and claims risk officer with Sun Life Financial, said the company’s “application process and forms are continuously developing to ensure we are caring, respectful and inclusive of all our clients and their diversity,” although Leblond did not specify whether forms yet included options beyond male and female.

Sun Life, however, was the only insurer that provided comment; the others refused or did not respond.

Insurance has long relied on biological sex as one factor upon which to assess risk when underwriting. Cisgender women live on average longer than cisgender men, for example, and certain sex-specific health conditions — for example a history of breast, ovarian, or prostate cancer — may affect risk profiles.

That said, insurers could find ways to account for these differences while still respecting individual clients’ gender identity. Forms, for example, could include multiple options for gender, including a write-in option rather than requiring a client to check a box. Financial institutions of all kinds could update systems and training to ensure that all clients’ chosen names, pronouns and honorifics are noted and used, and to ensure that information related to sex and gender is requested only when absolutely necessary.

Avoiding the issue or addressing the needs of trans and non-binary clients on a case-by-case basis risks further marginalizing an already marginalized population: recent studies and surveys conducted by the Public Health Agency of Canada and TRANS Pulse Canada, for example, have found that trans and non-binary people (who make up just one third of one percent of Canada’s population) are financially disadvantaged compared to their cisgendered counterparts.

Applying for insurance requires all clients to disclose sometimes sensitive or uncomfortable personal health information, regardless of gender; insurers and advisors can use their longstanding expertise in handling this sort of information respectfully and discreetly when working with trans and non-binary clients. And the industry — in consultation with trans, non-binary and other gender nonconforming clients, professionals and stakeholders — can and should take a leadership position on this issue, Perreira said.

“There are so many gaps, and we need to take a long hard look at them and come up with some reasonable assumptions, because it’s no longer 1952,” she said. “It is not a binary world and it’s only going to go more and more in that direction. Companies are going to have to and want to change with the times.”