In order to update its Insurance Act, the Saskatchewan government introduced Bill 177 late last year. While the financial advisor association Advocis says it is pleased with much of the new legislation, it has expressed concern over the separate licensing category that the provincial government has proposed for managing general agencies (MGAs).
In a letter sent to Financial and Consumer Affairs Authority of Saskatchewan on February 17, Advocis president and CEO Greg Pollock and chairman David Juvet said they were taken by surprise by the measure, and argued that the province had failed to explain why there was a need for MGAs to have a new type of license.
"There was no public consultation on this matter before the Bill was introduced in the legislature," reads the letter. "We are not aware of any evidence or analysis that suggests the use of the life license category by MGAs causes harm to consumers, regulators or industry, or how a separate MGA license class would resolve any purported problems."
Advocis points out that a report published by the Canadian Council of Insurance Regulators (CCIR) reviewed the business practices of MGAs and found that the existing licensing structure was serving all stakeholders well.
"We wish to understand Saskatchewan’s policy objectives behind this proposal, lest licensing becomes 'an end in itself' as cautioned by the CCIR," concludes the association’s message to the regulators. "So we urge the province to hold a fulsome consultation on the matter before proceeding with the Bill in its current form."