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BC MoF Consultation (Comments by Oct 3): Restricted Licence Regime for Incidental Sellers of Insurance

Stikeman Elliot |  Stuart Carruthers and Andrew Cunningham | Aug 29, 2022

BC Minstry of finance consultation on insurance restricted license regime - BC MoF Consultation (Comments by Oct 3):  Restricted Licence Regime for Incidental Sellers of InsuranceBritish Columbia’s Ministry of Finance is conducting a consultation on the adoption of its proposed restricted insurance agent licensing regime for incidental sellers of insurance.

  • The proposal is similar to what is already in place in the other three western provinces (and, soon, in New Brunswick) but B.C. is signalling that it may consider including additional industries and additional flexibility in its regime.
  • B.C. consultation is focused on the regulations and rules that will accompany the legislation, and particularly on the following issues:
    • The classes of restricted licensees (i.e. the types of business that will be eligible for restricted licenses);
    • The classes of insurance that can be sold under a restricted licence; and
    • How this new regime will affect existing exemptions under the Insurance Licensing Exemptions Regulation.

Consultation Questions

The Ministry of Finance is looking for input from interested parties, including (but not restricted to) industry views on questions such as the following:

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  • Which businesses should and should not be prescribed as potential licensee
  • Which classes of insurance should and should not be prescribed?
  • Which ILER exemptions, if any, should be repealed in favour of offering one of the new restricted insurance agent licences (and should the repeal be full or partial)?
  • When (if ever) should exceptions be made to the general expectation that restricted licensees will be restricted to classes of insurance that are incidental to their ordinary business?
  • Should there be any licence exemptions for low-value products?
  • Should there be a maximum value for insurance policies (or of certain types of insurance policy) sold by restricted insurance agent licensees?
  • Would a deferred sales model be advisable for any class of restricted agent (i.e., a model in which insurance could not be offered until a certain number of days after the primary purchase)?
  • Which rules should apply to the conduct of a restricted licensee’s insurance business (e.g. with respect to disclosure, cooling off periods, commissions and fees, etc.)?

Please see the consultation paper for the complete list of questions on which comment is sought.

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As noted above, the public consultation is ongoing, with comments due on or before October 3, 2022. The open and flexible approach of the Ministry of Finance indicates that industry submissions could have a significant impact on the eventual shape of the restricted licensing regime.

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