IFB's comments on the Insurance Council of Manitoba's (ICM's) consultation on its proposed regulatory amendments which include an updated fee structure for licensees.
May 6, 2024
Insurance Council of Manitoba
466-167 Lombard Ave
Winnipeg MB R3B0T6
Sent by email: licensing@icm.mb.ca
Dear Sirs/Mesdames:
Subject: Proposed Regulatory Amendment to enhance consumer protection (Fees)
Independent Financial Brokers of Canada (IFB) appreciates the opportunity to comment on the Insurance Council of Manitoba’s (ICM’s) consultation on its proposed regulatory amendments which include an updated fee structure for licensees.
About IFB
IFB is a not for profit, national association whose members are financial advisors. Most IFB members operate small to medium sized practices in their local communities. They choose to belong to IFB to receive the professional support and advocacy that IFB provides.
Most IFB members are life insurance licensees and often are also mutual fund registrants. Many hold other accreditations or licenses so they can address the more comprehensive financial needs of their clients – whether these clients are individuals, families, or businesses. All share the belief that their clients are better served by their ability to offer products and services from a variety of sources. Independent advisors provide an important community alternative to the proprietary advice offered by many financial institutions.
Comments on the proposed regulatory amendments
The ICM cites that the proposed changes to its fee structure are to ensure fees appropriately and accurately reflect the regulatory efforts and activities required to enhance consumer protection. IFB supports the important work the ICM does to protect consumers and the public interest, and in continuing to invest in modernizing its licensing and oversight activities.
The ICM’s fees were last updated in 2004 and it suggests the proposed changes more accurately reflect the actual cost and effort of processing applications for licences and examinations.
We understand that the ICM has not increased its life insurance licensing fees for 20 years. It would be our hope, however, that the ICM has set a consistent and future-focused approach to its fee structure and has evaluated its regulatory costs in such a way that any further increase is not expected to be required for some time.
Fee increases affect independent life insurance agents/brokers directly as they pay their own licensing costs. In addition, independent life insurance agents/brokers are not immune to the increased costs associated with running a business in today’s challenging economic climate of high inflation. Licensees are experiencing higher costs associated with meeting their ongoing regulatory requirements which include licensing fees, continuing education courses, E&O insurance, privacy/business interruption insurance, and so on. As independent businesspeople, life insurance agents and firms need to be able to rely on a consistent approach to fee setting from their regulators to be able to effectively budget and plan.
We note that the consultation paper does not set out any financial details to support the new fee structure or if this shortfall is across all licensing categories or specific to a particular segment of its regulated entities (e.g., life insurance, general insurance, etc.). We hope the oversight cost is attributed to each sector appropriately and borne by those licensed entities.
Corporate licence: The ICM has proposed the introduction of corporate licence fees in anticipation of the future implementation of corporate licensing. We understand from this that, although the capability to charge a corporate fee will be in place, it will not go into effect until the legislation is enacted.
Thank you for the opportunity to comment. IFB always welcomes the opportunity to work with the ICM to address industry and regulatory concerns. Please contact the undersigned, or Susan Allemang, Director Policy & Regulatory Affairs (E: sallemang@ifbc.ca) if we can assist further.
Yours truly,
Nancy Allan
Executive Director
T: 905.279.2727 Ext. 102
E: allan@ifbc.ca
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