UPDATE: Selected agents have been contacted. To access the questionnaire, see:
Life Insurance Agent Questionnaire - Reopened
Life Insurance Product Suitability Review (point-of-sale)
In the wake of the financial services crisis, governments and regulators around the world are concerned with knowing that consumers are receiving the appropriate levels of information and advice when they are purchasing financial services or products.
The Financial Services Commission of Ontario (FSCO), as recently published in its Statement of Priorities, is conducting a review to understand and assess the process that life insurance agents use at the point of sale in making suitable product recommendations to prospective policyholders. The review will also consider the actions that life insurance agents are taking to support the financial literacy of their clients. This is primarily an information gathering exercise for FSCO.
During summer 2013, FSCO consulted with industry stakeholders in order to obtain a clear understanding of the best practices for determining product suitability during a typical individual life sales process with a client. FSCO also considered stakeholders’ views on the best approaches to assess what occurs at the point of sale.
FSCO will be launching an online questionnaire on October 15, 2013, to gather information on practices of life insurance agents at the point of sale.
The questionnaire is being developed based on the information received during the consultative process, as well as the industry practices described in the document The Approach: Servicing the Client Through Needs-Based Sales Practices . The Approach was developed collaboratively by Advocis, the Canadian Association of Independent Life Brokerage Agencies (CAILBA), the Canadian Life and Health Insurance Association (CLHIA) and Independent Financial Brokers (IFB).
You may be selected to complete a mandatory questionnaire
You may be selected as part of a random or targeted sample of life insurance agents to complete the questionnaire. Selected agents will be notified via email on October 11, 2013. It is important to note that if you are selected, completion of the questionnaire is mandatory, pursuant to Section 442.3 of the Ontario Insurance Act “Duty to Provide Information” and the selected life insurance agents must complete the questionnaire by November 14, 2013. Failure to respond could result in regulatory action.
Furthermore, FSCO will also be selecting a random sample of agents for follow up assurance visits, in order to verify the reliability of the information provided by agents in response to the questionnaire. Therefore, it will be important to retain any material or records you used to support your questionnaire responses. Selected agents will be notified via email by November 30, 2013.
FSCO anticipates your cooperation and thanks those that have participated in the consultative process.