The Financial Services Regulatory Authority of Ontario (FSRA) wants a new rulebook for life and health managing general agents, but the industry says the proposal swings too wide and loads on new fees and compliance layers that could end up hurting consumers more than helping them.
FSRA argues the licensing overhaul would tighten oversight, strengthen consumer protection, and fix what it sees as recurring problems like weak agent screening, inconsistent training, and poor monitoring.
The draft lays out a C$1,000 application fee, new renewal fees that aren’t set yet, a three tier structure based on contract arrangements, and extra suitability requirements. It’s a big rewrite.
Advocis, the Financial Advisors Association of Canada, said the definitions in the proposal are so broad that solo advisors, small partnerships, and incorporated agents with tiny teams could fall under the new regime without realising it.
That raises a risk of accidental noncompliance and surprise regulatory obligations for people who aren’t running MGA style operations.
The group warned that advisors already licensed in Ontario would face new fees on top of their existing costs. They said the rule creates overlapping responsibilities and muddy compliance expectations. And with only 30 days to comment on a heavily expanded draft, the industry feels rushed.
Kelly Gorman, Advocis president and CEO, said many of their members run small advisory businesses, not big distribution networks.
She said the proposal cuts against Ontario’s own goals of modernizing regulation and reducing red tape for small firms. In her view, the rule limits consumer access to insurance advice rather than protecting them.
Ontario’s regulatory modernization and red-tape reduction principles aim to eliminate unnecessary administrative burdens and help small businesses.
Kelly Gorman, Advocis president and CEO
“This proposed rule does the opposite. Regulation should protect consumers – not push out small advisory businesses,” Gorman said in a statement.
FSRA is collecting feedback until November 19, but the debate already shows how far apart the regulator and the advisory community are on what modernization should look like.
The Financial Services Regulatory Authority of Ontario (FSRA) is a regulatory agency created to improve consumer and pension plan beneficiary protections in Ontario.
As a regulator, staying ahead of change in consumer markets is essential to our operations. By engaging with industry experts and consumers on a regular basis, we can respond quickly to new technologies, rules and consumer trends, ensuring the integrity and growth of our regulated industries.
FSRA was established to replace the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO).
