What happened: Manitoba's insurance regulator found that Westoba Credit Union sold creditor insurance for over six years without a valid licence
Who's involved: Westoba Credit Union Ltd. and its unnamed successor entity, the Life Insurance Council of Manitoba
What's at stake: $50,000 fine plus $5,000 in investigation costs; approximately $7.45 million in premiums collected and $1.59 million in commissions earned during the unlicensed period
Why it matters: The decision is a sharp warning to financial institutions and their sponsoring insurers about what happens when licensing lapses go undetected - or unaddressed - for years
Where it stands: Final decision, published October 19, 2026; no appeal filed
For more than six years, a Manitoba credit union kept selling insurance to its members. It issued thousands of certificates. It collected millions in premiums. And the whole time, it did not have a licence.
The Life Insurance Council of Manitoba has published its decision against Westoba Credit Union, finding the institution sold creditor insurance products - life, disability, critical illness, and loss of employment coverage - from June 2018 through the end of 2024 without the restricted insurance agent licence required under Manitoba's Insurance Act.
The numbers are not small. During what the council calls the "Unlicensed Period," Westoba issued approximately 4,594 certificates of insurance, enrolled members in a total of 13,431 coverage benefits, and collected roughly $7.45 million in premiums. The credit union earned approximately $1.59 million in commissions from those sales.
The trail starts in September 2017, when the person responsible for Westoba's insurance licensing - known under Manitoba's rules as its designated official - left the credit union. The credit union was required to notify the regulator immediately and appoint a replacement. It did neither.
The designated official's licence was due for annual renewal by May 31, 2018. No one renewed it. When that deadline passed, Westoba's own restricted agent licence expired.
But the selling continued.
What makes the case particularly pointed is what happened next. In July 2018 - two months after the licence expired - Westoba's chief operating officer signed a document with the sponsoring insurer attesting to the credit union's compliance with the insurer's procedures for selling insurance.
In September 2018, Westoba entered a five-year distribution agreement with the insurer. In December 2020, the chief executive officer signed an undertaking that stated, according to the decision: "Unauthorized or unlicensed insurance activity shall not be conducted and where required, proper insurance licenses shall be obtained by the Undertaking Party.…"
At the time each of those documents was signed, Westoba did not hold a valid licence.
The council found that providing attestations of compliance while carrying on unlicensed activity amounted to misrepresentation.
Westoba amalgamated with two other entities on or about January 1, 2025, forming a new successor entity. The new designated official, appointed to act for the combined credit union, flagged the licensing concerns to the regulator in a letter dated February 26, 2025.
The council's investigation confirmed the timeline: no designated official in place from September 2017, no valid licence from June 2018, and continuous insurance sales throughout.
Westoba's CEO had stated during the investigation that the regulator never contacted the credit union about the lapse. The council was blunt: the obligation to maintain a valid licence rests with the licence holder, not the regulator.
The council found Westoba violated multiple provisions of Manitoba's Insurance Act and regulations. The findings included unlicensed insurance activity, failure to notify the regulator when its designated official departed, misrepresentation, and unfair or deceptive practices. It described the conduct as "a significant breakdown in internal controls and a disregard for the regulatory framework governing the business of insurance."
The successor entity was fined $50,000 and assessed $5,000 in investigation costs. It accepted the decision without requesting a hearing and did not appeal.
The council noted that the sponsoring insurer confirmed all policies issued during the unlicensed period remained valid and in force. But validity, the decision states, "does not mitigate the seriousness of the Former Entity's conduct." The licensing framework exists to ensure oversight, accountability, and consumer protection - and operating outside it undermines the regime regardless of whether individual policies are honoured.
For insurers and financial institutions that distribute creditor products through restricted agent arrangements, the decision is a pointed reminder that licensing is not a set-and-forget exercise - and that the regulator will look at who signed what, and when, if the system breaks down.
