For several years, Canadian regulators of life insurance agents have worked together with the stakeholders in the life insurance industry to harmonize and update the standards for life insurance agent proficiency. The new standard that has been developed is known as the Life Licence Qualification Program (LLQP). It provides a one-step licensing system that requires completion of a mandatory pre-licensing course, and passing a qualifying examination.
Beginning June 1, 2002 the Financial Services Commission of Ontario (FSCO) approved the LLQP for the purpose of qualifying as a life insurance agent, and treated the completion of the LLQP course and examination as equivalent to the existing Level I and Level II examinations.
During this optional equivalency period, regulators gave life insurance applicants the choice of completing either the LLQP course and examination or the existing Level I and Level II examinations. Regulators committed to implementing the LLQP on an optional basis for a period of not less than 90 days to allow regulators and stakeholders an opportunity to monitor the progress and effectiveness of the LLQP, and make adjustments. As a result, the regulators are now in a position to proceed with mandatory implementation, beginning January 1, 2003.
Mandatory LLQP Implementation effective January 1, 2003
Beginning January 1, 2003, the Level I examination will no longer be recognized in Ontario for the purpose of qualifying as a new life insurance agent unless the agent has requested to write the examination with the Canadian Association of Insurance and Financial Advisors prior to that date, and passes the examination by January 31, 2003. With this exception, completion of the LLQP course and examination – full or restricted – will be the only recognized way for entry level agents to obtain a licence.
New applicants contemplating taking the Level I examination, or purchasing course materials toobtain a Level I licence, should be aware that they have until December 31, 2002 to register for the Level I exam. Level I Life insurance agent licences will not be issued to new applicants unless they have registered for the Level I examination prior to December 31, 2002 and passed the examination by January 31, 2003. Note that applying on-line using the Internet Application System (IAS), available through the Licensing section of FSCO's website, expedites the licensing process and is secure and convenient.
FSCO and other provincial and territorial regulators have been and will continue to monitor the performance of agents and course providers as the LLQP is introduced. We intend to ensure that the objective of modernizing the proficiency standard to enhance the ability of new agents to meet consumer needs is achieved. Consumer confidence is the fundamental underpinning of the entire system of financial services.
FSCO and other regulators have introduced some temporary measures to ease the transition from the existing standard to the LLQP. These temporary measures are described in this bulletin.
Existing Level I agents and Level II agents
A licensed agent with Level I qualifications obtained prior to January 1, 2003 will not be affected by this change. He or she continues to be required to complete the requirements for a Level II licence within four years from the date that the licence was first issued, provided he or she remains licensed over that period. The Level II examination, modified as required, will continue to be recognized for this purpose.
A licensed agent with Level II qualifications obtained prior to January 1, 2003 will not be affected by this change. He or she will continue to qualify for a licence upon renewal, based on his or her Level II qualifications.
Transitional Restricted Licence
While all new agents are required to complete the full LLQP course and examination, for a limited period of time the Superintendent of Financial Services is prepared to permit applicants to use a two-step approach to completing the LLQP. The Superintendent will grant a life agent licence, referred to as a Transitional Restricted Licence, to individuals who have not met the requirements for the full LLQP, but who have completed a designated portion of the LLQP course and a designated portion of the LLQP exam, and who apply for the Transitional Restricted Licence option.
To obtain a Transitional Restricted License, the agent must sign an undertaking in which he or she agrees to the following conditions and asks the Superintendent to grant a licence notwithstanding that all LLQP requirements have not been met:
- enroll within 180 days of being licensed in a course offered by a course provider acceptable to the Superintendent to complete the LLQP;
- complete the remaining portion of the LLQP course and pass the remaining portion of the LLQP examination within two years of the date licensed;
- prepare a written needs analysis of the client for all life insurance applications; and
- have all policy applications and needs analyses co-signed by an agent who has aminimum of two years licence experience and completion of either Level II or the full LLQP.
A copy of the request for a Transitional Restricted Licence that the agent must submit is attached to this application. The form can also be completed using FSCO’s Internet Application System.
Companies that intend to sponsor or contract with agents who have Transitional Restricted Licences must provide an undertaking in the form attached to this bulletin acknowledging that they will maintain records and a system satisfactory to ensure that such agents comply with the restrictions on their licences.
LLQP Course and Examination Requirements
Applicants enrolling in the LLQP must become knowledgeable in the products and services relevant to the current marketplace. The LLQP is designed as a practical standard based on the real life experience of life insurance agents.
The names of approved course providers are published on the FSCO website
(www.fsco.gov.on.ca) The courses are provided commercially, and course fees are set by the individual course providers. Course providers are accountable for providing instruction and documents based on the course curriculum, and the courses will be monitored by FSCO.
Courses provided by different course providers are designed to cover the same material and are developed using the same curriculum, but they can take different formats, such as a classroom course, correspondence, or Internet. Agents are encouraged to research the various course options to ensure the course selected is appropriate for their needs.
Durham College has been selected as the examination administrator for the LLQP in Ontario. The LLQP examination is only available for applicants who have successfully completed the course. All inquiries regarding locations, times and examination details should be directed to
A committee to be known as the LLQP Integrity Committee is responsible for the ongoing development and maintenance of the LLQP examination questions database and will advise regulators on operational matters related to the examination process.
A series of answers to typically asked questions about the LLQP is attached. Further information describing the LLQP will be provided on the CCIR website (www.ccir-ccrra.org).
Questions can also be posed by email to the Canadian Council of Insurance Regulators (CCIR) at the following address LLQP@fsco.gov.on.ca All questions will be responded to and answers of general applicability, will be posted on the CCIR website.
Questions about LLQP implementation in Ontario should be directed to:
FSCO's LLQP Licensing Hotline: 416-250-9209 or 1-800-263-0541
We are confident that this program will serve to enhance the training and proficiency standards of life insurance agents across the province.
Bryan P. Davies
Chief Executive Officer and
Superintendent of Financial Services
December 20, 2002