Geller Law
If you have a life insurance policy that was sold based on promises that are not true, then you may have a way to get your money back. One of the tools we use is based on insurers failing to fulfill their duty to protect you from poorly trained agents who misrepresent what life insurance can do for you. If your loss is a foreseeable result of an insurer's breach of their duty of care, then there is hope. Here's an example.
In Ontario, the duty of insurers to undertake compliance oversight of all agents who distribute their products is found in Regulation 347/04 section 12 as follows:
(1) Every insurer that authorizes one or more agents to act on behalf of the insurer shall establish and maintain a system that is reasonably designed to ensure that each agent complies with the Act, the regulations and the agent’s licence.
(2) The system referred to in subsection (1) must screen each agent for suitability to carry on business as an agent.
FSRA has a Notice of Proposal which seeks to enforce this duty:
"The Thematic Review identified multiple gaps in WFG’s operations resulting in a lack of oversight of the agent-related delegated functions. The lack of direct agent monitoring, delegation of monitoring functions without verifying completion of delegated functions, and no formal proactive agent reviews, in combination with a large proportion of gross income generated from the sale of relatively complex Permanent Life products by newly licensed agents, raise concerns about potential consumer harm."
In my experience, an alleged fact is common to most Canadian life insurers as follows:
"The WFG training and supervision framework is largely based on delegation to upline agents. When asked as part of the Thematic Review if WFG has documented policies and procedures specifically related to licensed agent monitoring and supervision, WFG stated that it does not perform direct monitoring and supervision of agents. WFG also reported it has no specific individuals or departments formally overseeing the entire licensed agent monitoring function."
If these protections are enforced, what will this mean for consumer protection of life insurance consumers in Canada?
See: https://decisions.cisro-ocra.com/ins/fsra-arsf/en/item/521232/index.do
