A major U.S. life insurance company is saying changes to the testing system for new agents in Canada may harm ordinary consumers.
A major U.S. life insurance company is saying changes to the testing system for new agents in Canada may harm ordinary consumers.
The new national testing system – to be administered by the stock-market regulator in Quebec – could lead to higher costs, less agents, and less people buying life insurance, says Primerica, which touts itself as the largest independent financial services marketing company in North America.
“Our representatives sit at the kitchen tables of middle-income Canadian households, rural Canadians, new Canadians – under-served communities,” says Karen Sukin, Primerica's head of government relations. “The new licensing system will reduce the number of licensed life insurance representatives available to help families. It also will kill jobs and the livelihood of thousands of Canadians.”
Quebec currently has significantly higher testing fees than other provinces.
According to Primerica, Canadians already have less insurance coverage than most OECD countries, and Quebec is at the lower end of that range, and that the testing system to be implemented in 2016 will only make matters worse.
Any additional barrier to new licences will disproportionately affect working-class and immigrant communities, states Primerica, which it views as its target market. If less agents sign up for the tests from those communities, it says fewer people from those communities will buy insurance.
Primerica points to two particular concerns: the potential fee hike, which would be passed down to prospective agents and consumers; and the new four-module exam system, which will test people in separate areas unlike the all-in-one system that currently exists in most provinces.
The Canadian Insurance Services Regulatory Organizations says that Primerica’s concerns have been blown out of proportion. (continued.)
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According to CISRO chair Ron Fullan, the new exam will cost $65 to do the test, and an additional $65 fee for next five years to help recover the costs of the reform.
Course providers will also charge additional fees as they already do, says Fullan.
That’s far cheaper than the $700 figure being floated by some opponents of the new system, Fullan points out.
“In return,” he says, “Canada will get a single, harmonized testing system that will simplify things for interprovincial call centres and for people who move between provinces.”
The new four-part test will ensure agents have minimal knowledge of various aspects of their industry, adds Fullan, while allowing them to retake one module should they fail, instead of having to redo the whole exam like they do now in most provinces.
"We believe the changes made are going to enhance consumer protection, on one side," Fullan said. "And some of the revisions will also make the exam experience better for applicants. We believe it's a win-win."
Trade consultant Laura Dawson, who conducted research on the issue for Primerica, said the $4 million cost to implement the new system might have been worth it – if it was actually fixing a real problem.
“You can handle paying more for a test, or a new administrative system, if there's a problem that you're solving,” Dawson told CTV News, “if there was a fundamental flaw with the previous test, if the insurance regulators are getting complaints, if consumers are unhappy, if there's a real impetus across the country for harmonization. But none of those things is actually happening. Is it really a solution looking for a problem?” (continued.)
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CISRO takes umbrage at those who characterize the new system as some kind of Quebec takeover.
According to Fullan, the new system will incorporate ideas from different parts of the country. The four-part exam system does come from Quebec, while ideas from other provinces will be incorporated – such as group-insurance on the exam and mandatory pre-test courses, which aren't required in Quebec.
The new national testing system – to be administered by the stock-market regulator in Quebec – could lead to higher costs, less agents, and less people buying life insurance, says Primerica, which touts itself as the largest independent financial services marketing company in North America.
“Our representatives sit at the kitchen tables of middle-income Canadian households, rural Canadians, new Canadians – under-served communities,” says Karen Sukin, Primerica's head of government relations. “The new licensing system will reduce the number of licensed life insurance representatives available to help families. It also will kill jobs and the livelihood of thousands of Canadians.”
Quebec currently has significantly higher testing fees than other provinces.
According to Primerica, Canadians already have less insurance coverage than most OECD countries, and Quebec is at the lower end of that range, and that the testing system to be implemented in 2016 will only make matters worse.
Any additional barrier to new licences will disproportionately affect working-class and immigrant communities, states Primerica, which it views as its target market. If less agents sign up for the tests from those communities, it says fewer people from those communities will buy insurance.
Primerica points to two particular concerns: the potential fee hike, which would be passed down to prospective agents and consumers; and the new four-module exam system, which will test people in separate areas unlike the all-in-one system that currently exists in most provinces.
The Canadian Insurance Services Regulatory Organizations says that Primerica’s concerns have been blown out of proportion. (continued.)
#pb#
According to CISRO chair Ron Fullan, the new exam will cost $65 to do the test, and an additional $65 fee for next five years to help recover the costs of the reform.
Course providers will also charge additional fees as they already do, says Fullan.
That’s far cheaper than the $700 figure being floated by some opponents of the new system, Fullan points out.
“In return,” he says, “Canada will get a single, harmonized testing system that will simplify things for interprovincial call centres and for people who move between provinces.”
The new four-part test will ensure agents have minimal knowledge of various aspects of their industry, adds Fullan, while allowing them to retake one module should they fail, instead of having to redo the whole exam like they do now in most provinces.
"We believe the changes made are going to enhance consumer protection, on one side," Fullan said. "And some of the revisions will also make the exam experience better for applicants. We believe it's a win-win."
Trade consultant Laura Dawson, who conducted research on the issue for Primerica, said the $4 million cost to implement the new system might have been worth it – if it was actually fixing a real problem.
“You can handle paying more for a test, or a new administrative system, if there's a problem that you're solving,” Dawson told CTV News, “if there was a fundamental flaw with the previous test, if the insurance regulators are getting complaints, if consumers are unhappy, if there's a real impetus across the country for harmonization. But none of those things is actually happening. Is it really a solution looking for a problem?” (continued.)
#pb#
CISRO takes umbrage at those who characterize the new system as some kind of Quebec takeover.
According to Fullan, the new system will incorporate ideas from different parts of the country. The four-part exam system does come from Quebec, while ideas from other provinces will be incorporated – such as group-insurance on the exam and mandatory pre-test courses, which aren't required in Quebec.
