The discipline process in Ontario has been left largely untouched since the 1930s – and the provincial regulator wants the insurance industry to weigh in on how it should be brought into the 21st century.
The Financial Services Commission of Ontario is looking for input on modernizing the disciplinary hearing process for insurance agents and adjusters under the province’s Insurance Act, having released the paper Modernizing Disciplinary Hearings for Insurance Agents and Adjusters in Ontario: A Proposal for Consultation just recently.
“The current process set out in the Act for making disciplinary decisions about agents and adjusters is 90 years old,” says Grant Swanson, executive director of the licensing and market conduct division at FSCO. “It is cumbersome and does not align with modern disciplinary and enforcement processes and standards. Nor does it align with the statutory processes for licensing and discipline matters in other sectors that FSCO regulates.”
Some of the required changes proposed include:
- Remove the requirement for the Superintendent to appoint Advisory Board panels that conduct hearings about disciplinary matters.
- Replace the AB process with the Financial Services Tribunal as the body that holds hearings. The FST would have the authority, following a hearing, to direct the Superintendent to carry out his proposal, with or without changes. It would also have the authority to substitute its opinion for that of the Superintendent and impose such conditions as it considers appropriate, for all disciplinary matters.
- Give the person and the Superintendent the right of appeal for licensing decisions from the FST to the Divisional Court.
“Under the desired model, all insurance agent and adjuster disciplinary decisions would follow the FST model,” says Swanson. “The FST model has fewer steps than the AB model.”
In addition to these changes, FSCO also proposes housekeeping/clarification changes and other changes that would avoid the loss of jurisdiction once a disciplinary process has begun. This would include giving the Superintendent explicit authority to:
- Issue interim orders to suspend licences where there was a risk of harm to the public, if there was any delay;
- Continue disciplinary matters despite the fact that a licence may have expired, or been suspended or surrendered; and
- Consider applications by agents and adjusters seeking permission to surrender their licences.
For more information or to send a comment or suggestion, you can click here, or contact Jim Fox, Senior Policy Analyst, Licensing and Market Conduct Division, FSCO. All comments must be submitted by September 30.
“The responses gathered from this consultation will help inform the government’s decision to modernize the disciplinary process for insurance agents and adjusters,” says Swanson.
The most recent changes under the Act were the Administrative Monetary Penalties (AMPs) introduced on January 1 of this year. Now, the Superintendent may impose AMPs against insurance agents and adjusters who contravene or fail to comply with requirements under the Act, separately or in combination with licence suspensions or revocations.
