Public Trust: A Shared Responsibility

The financial services industry, and more specifically the channels of distribution for insurance, strives to achieve a level of professionalism daily to earn public trust.

We define Public trust as the degree to which the public believes that the insurance professional and the products life agents promote will act in a particular way that serves and protects the public interest. Public trust is key to the continuing success of the insurance & financial services industry.

Clients trust Insurance professionals for a variety of reasons. Trust is based on the agent himself/herself, the agent’s credentials, the reputation of the various product manufacturers they promote, and the regulatory supervision they operate under. If standards erode at any level, the public trust can be lost and difficult to restore. We all have a role to play in maintaining and growing public trust while decreasing the administrative burden and anxiety for advisors.

Continued Regulatory Actions to Promote Public Trust

In July 2021, the MFDA announced a new CE (Continuing Education) regime to be implemented by December 2021. The new requirements target the 60,000 MFDA members who will be required to upload their CE credits onto a new system to report and track compliance with the new CE requirements, known as CERTS. In September 2021, the Financial Services Regulatory Authority of Ontario (FSRA) issued proposed guidance for life agents’ reporting requirements for comments. The proposed guidance outlines licensing information that life agents must report under the Insurance Act. The regulator requires life agents to report on: errors and omissions insurance, continuing education, and contracted insurers. FSRA also has aspirations to see the other provincial regulators follow their lead on these issues. If successful, each province will have harmonized rules.

Rise of Advisor Administrative Anxiety

Over the years, regulatory oversight has been growing based on ensuring & enhancing client/investor knowledge and protection, ultimately enhancing public trust. Advisor reaction has varied. Some view this as an administrative burden, others believe this continues to grow public trust in the financial services profession. Exacerbating advisor anxiety, and the numerous and varied administrative reporting requirements, placed on dually licensed advisors who hold securities and life licenses has been increasing. In the new MFDA reporting model, advisors must track and report their CE credits to ensure securities license renewal while on the Life renewal, based on the proposal, the personal attestation on license renewal of CE credits may continue with the insurance companies shouldering the responsibilities to ensure agents are meeting the requirements.

In an alternative world without insurance companies and advisors, there would potentially be no need for regulations, but on the other hand, without regulations – insurance might be distributed through vending machines – not through licensed life agents. In reality, we are in a complex interconnected relationship. It requires both the licensee and the distributors to work together to ensure public trust. Ignoring the fundamental licensing requirements – which include CE Credits- is no longer an option. Technology is available to help ensure dealers, agents, and distributors meet these requirements without the manual administrative burden or disruptions to business and profits.

CE Records Inc. A Canadian Fintech Can Help

Technology can be disruptively helpful, during the Covid19 pandemic lockdown, it has proved itself to also be an enabler. The rapid adoption of Zoom and DocuSign permit life agents to continue to meet & service existing clients while developing new clients from the safety of their home office.

CE Records technology harmonizes different CE administrative reporting (Securities, Life Insurance & Designations) onto one application. Providing 24/7 access to a turn-key CE credit record-keeping application for life and securities agents, MGAs, dealers, and insurance companies to track, record & reconcile regulatory requirements for CE credits under the new regime. CE Records’ empathetic and passionate approach to solving CE compliance anxiety while creating business comfort for companies and advisors contributes to a role we all play in our industry that continues to strive to maintain public trust.

Written by: Colin Henry, B.A., CIM, President of CE Records Inc. CE Records is a software company that serves Canadian financial advisor’s needs to better manage CE credits. www.ce-records.com