No one wins if current rules for financial professionals’ titles remain as is

The excerpted article was written by  The Globe and Mail

Recent efforts from the Ontario government to ensure that only financial professionals with appropriate credentials be able to call themselves “financial planners” or “financial advisors” are being met with resistance from financial services industry associations lobbying to maintain the status quo. If this self-serving push is victorious, it will only benefit the least-qualified providers of financial services and be another setback for professionalization and transparency in the investment industry.

Currently, financial professionals’ titles in any province other than Quebec are borderline meaningless due to lack of standardization and qualifications. These titles do nothing to inform consumers of financial services as to what the financial professional they deal with actually does. Worse yet, these titles give the person providing the service a level of credibility that may be completely unearned and unwarranted.

The provincial government in Ontario – home to the largest population of financial professionals in the country – aimed to rectify all of that when it passed the Financial Professionals Title Protection Act, 2019. (The legislation received Royal Assent in May 2019.) Since then, the Ontario government has entrusted the province’s newest financial services regulator, the Financial Services Regulatory Authority of Ontario (FSRA), to oversee the implementation of the law. Public consultations on the draft regulations closed on Nov. 12.

The proposed regulations would limit the use of the title “financial planner” or “financial advisor” only to financial professionals who hold a qualifying credential. Ontario’s goal is to review the available credentials – such as the certified financial planner and the chartered investment manager – to determine which ones qualify for either title. This will be a substantial improvement from where things stand today, in which anyone can call themselves anything they want.

There are many positive submissions to the public consultations. For example, various investor groups and advocates have argued the proposed rules don’t go far enough because they don’t impose a fiduciary standard. Many have even provided constructive feedback on how the FSRA can make the most of this legislation.

In contrast, some industry associations’ submissions are nothing more than a self-interested preservation of the status quo. They say Ontario’s proposed rules set the bar too high because they would exclude some people who are using either title now from continuing to do so without achieving further designations or credentials.

For example, the proposed rules say that someone who has achieved a licence to sell life insurance products – and no further designations or training – would not qualify to use either the financial planner or financial advisor title. In response, the Canadian Life and Health Insurance Association Inc. (CLHIA) and various insurance-centric organizations argue that the existing insurance sales training “meets or exceeds the baseline competency of someone who calls themselves a ‘financial advisor,’” and, as a result, no further qualifications should be required.

Similarly, the Investment Industry Association of Canada (IIAC) argued in its submission on the proposed rules that financial professionals who are regulated by either the Mutual Funds Dealers Association of Canada (MFDA) or the Investment Industry Regulatory Association of Canada (IIROC) should be exempt from any requirement to obtain further credentials or training before using the financial advisor title.

In both cases, the argument is that the existing qualifications are sufficient to merit the use of the financial advisor title and that requiring further training would pose an “undue regulatory burden” on financial professionals. The problem with this approach is that IIROC or MFDA licensing provides people the level of understanding required to sell a product. However, financial advice and financial planning are not focused narrowly on product sales. In fact, they may result in no product sales whatsoever.

Instead, financial planners or financial advisors synthesize information to make well-educated, informed recommendations. Product selection and sales are only a tiny fraction of financial planners’ or financial advisors’ process and are only made after information-gathering, analysis, and synthesis to ensure the right fit.

The FSRA has already singled out the course that qualifies someone to sell insurance in Ontario as falling short of the standard required for the financial planner title. The course leading to MFDA licensing similarly falls short of that standard. In fact, Jason Watt, a full-time instructor at the Business Career College, a financial services course provider that’s recognized nationally, says “the mutual fund licensing course represents a bar of proficiency no better, if not lower, than the standard set by the life insurance sales training course.”

If the submissions from the CHLIA, the IIAC and others pushing for the status quo are accepted, title reform in Ontario won’t amount to anything more than rubber-stamping the entire financial services industry as-is – turning this entire exercise into a perfect example of regulatory capture.

The winners of title regulation will be the least-educated and least-qualified members of the industry – and the companies that rely upon them for sales revenue. Everyone else – especially consumers of financial services, educated and credentialled financial planners and financial advisors, and the entire financial services industry in Ontario – will lose.

Millennials and members of Generation Z already distrust financial services institutions and are looking at digital alternatives like robo-advisors. Turning title reform into a farce is just one more reason for them to continue to shift away from traditional financial services providers altogether.

Reminder to all Manitoba License Holders

Reminder to all Manitoba License Holders

In March 2020, Manitoba’s Superintendent of Financial Institutions had approved that the requirement for mandatory Continuing Education (CE) reporting for the 2020 licence renewal was to be deferred to May 2021 for all licensed agents, and deferred to June 2021 for all licensed adjusters. This allowed Manitoba licence holders who were required to report CE credits to renew their licences for 2020 without having to complete or report mandatory CE for the 2020 year.

This is an early reminder that licence holders must complete the required number of CE credits for both the 2020 and 2021 years, and report all of these hours prior to licence renewal for 2021.

The Insurance Council of Manitoba (ICM) thanks industry for the positive feedback we received for the 2020 reporting deferral. We commend all stakeholders involved in the renewal process during May and June 2020.

For the 2021 Manitoba licence renewal, if you are required to complete and report CE in Manitoba, the following number of CE credits will be required to be completed and entered into your online portal before being able to renew your licence(s):

• General insurance agents: 16 CE credits completed and reported prior to May 31, 2021;
• Auto Only insurance agents: 8 CE credits completed and reported prior to May 31, 2021;
• Adjusters (N/A to Hail Adjusters): 16 CE credits completed and reported prior to June 30, 2021;
• Life and/or A&S agents: 30 CE credits completed and reported prior to May 31, 2021.

You will be unable to renew your licence(s) in 2021 if you do not complete and report the 2020 CE credit requirements in addition to the 2021 CE credit requirements.

However, as in each year, licence holders who are resident in another Canadian jurisdiction which has mandatory CE requirements are not required to also fulfil the Manitoba annual CE credit criteria.

For more detailed information on CE requirements in Manitoba, please refer to the Continuing Education Info page on the ICM website.

New Licensees as of June 1, 2020 (July 1, 2020 for adjusters) MUST ensure that their CE is accumulated in the 2020/2021 licence year. Refer to this page on the ICM website for additional information.

Examples of CE requirement scenarios for the 2021 year due to the 2020 deferral:

1. Example #1: If a general or adjuster licence holder currently has 4 credit hours applied/reported in the CE system on May 1, 2020, they would be required to obtain and report 12 additional CE credits to renew their licence in May 2021 (June 2021 for adjusters). Each year thereafter, they would be required to obtain the annual CE requirement of 8.

2. Example #2: If a life licence holder currently has 0 credit hours applied/reported in the CE system on May 1, 2020, they would be required to obtain and report 30 CE credits to renew their licence in May 2021. Each year thereafter, they would be required to obtain the annual CE requirement of 15 within their annual licence period (no carry forward).

3. Example #3: If a life licence holder currently has 19.5 credit hours applied/reported in the CE system on May 1, 2020, they would only be required to obtain and report an additional 10.5 CE credits to renew their licence in May 2021. Each year thereafter, they would be required to obtain the annual CE requirement of 15 within their annual licence period (no carry forward).

INSURANCE COUNCIL OF MANITOBA

Sun Life CEO Dean Connor will retire next August, CFO Kevin Strain to replace him

TORONTO _ Sun Life Financial Inc. says its president and chief executive will retire next year.

The Toronto-based insurance company says Dean Connor, 64, will depart Sun Life on Aug. 6.

The company’s current executive vice-president and chief financial officer, Kevin Strain, will take over Connor’s presidential duties on Dec. 15.

He will become chief executive when Connor retires and will continue working as chief financial officer until the company names a replacement in the first half of 2021.

Strain joined Sun Life in 2002 as part of the acquisition of insurance company Clarica. He became CFO in 2017.

Strain launched Sun Life Global Investments Asset Management and expanded the company’s footprint to Vietnam and Malaysia, before climbing the company’s executive ranks.

More than ever before, Canadians are facing financial risk

As Canada deals with a global pandemic and rising household debt, Goose Insurance warns that most Canadians can’t afford further financial setbacks caused by a life-threatening illness.

VANCOUVER, BCNov. 9, 2020 /CNW/ – Goose Insurance, a new player in the life and health insurance market warns Canadians could be out-of-pocket tens of thousands of dollars while undergoing treatment for any life-threatening illness.

Goose Insurance recently conducted a survey of over 1000 Canadians, yielding some eye-opening results. The company found that less than 5% of respondents have critical illness insurance or cancer insurance and majority of the people wrongly believe that Canada’s health care system covers all costs associated with cancer treatment or any other life-threatening illness. Overwhelmingly, women are under insured in Canada, with over 70% of the women that responded to the survey have never purchased life or critical illness insurance.

According to the Canadian Medical Association Journal, nearly half of Canadians will be diagnosed with cancer in their lifetime. In fact, the CMAJ estimates that 225,000 people will be diagnosed with, and 83,000 people will die from, cancer in 2020 alone.

While Canada’s health care system covers many costs associated with life-threatening medical treatments, many patients still face out-of-pocket expenses while undergoing treatment, including some drugs not covered, childcare, rent or mortgage, and other household bills and responsibilities.  This comes at a time when Canadians are dealing with COVID-19, a global pandemic; whilst battling an all-time high household debt ratio of 176.9% according to Statistics Canada.

So why aren’t Canadians buying life and health insurance? Of those surveyed by Goose, the two most common reasons were accessibility and affordability. Specifically amongst young Canadians aged 25 to 35, over 50% didn’t know where to buy it from and over 70% found it too complicated.

“Goose is tackling the accessibility and affordability of insurance, and addressing the underserved market,” says Dejan Mirkovic, President of Goose Insurance. “We’re offering reasonable coverage limits at affordable prices, and the ability to buy policies in minutes without medical exams or the need to speak to an agent; all on the Goose app.”

Goose Insurance together with Industrial Alliance Financial Group, one of Canada’s largest Insurers, has made insurance accessible and affordable for anyone under 69 with a smartphone. On the Goose mobile app, Canadians simply become eligible by answering a few medical questions and can get up to $50,000 of Life Insurance for as low as $5 a month. Monthly premiums are based on age, gender, and smoking status.

“For decades, Special Markets Solutions (a division of iA Financial Group) has promoted voluntary insurance programs using traditional methods. While these offerings provided valuable coverage, these methods were outdated and time consuming. We are very excited to be partnering with Goose Insurance in offering voluntary products on a revolutionary digital platform.  This will allow the user to have an easy to understand, seamless and instant application experience . The future is now,” said Ed Bender, National VP, Special Markets Solutions at iA Financial Group.

___________________

Established in 2018 and based in Vancouver, British Columbia, Goose Insurance Services takes the confusing parts out of buying insurance and makes it easier than ever to get the right coverage. And it all happens in seconds, from a single app. Goose currently serves British ColumbiaAlbertaSaskatchewanManitobaOntario, Québec, and Nova Scotia in Canada as well as WashingtonOregonIllinoisGeorgiaNew Jersey, and Texas in the US. For more information about Goose, or to download the app, visit www.gooseinsurance.com

SOURCE Goose Insurance Services Inc.

https://www.gooseinsurance.com/en/

Novacap Acquires Interest In AGA Financial Group

MONTREALOct. 5, 2020 /CNW/ – Novacap, one of Canada’s leading private equity firms, announced that it acquired an interest in AGA Financial Group Inc. (“AGA”), one of Quebec’s leading employee benefits advisory firms and third-party administrators of group insurance and retirement plans.

AGA helps businesses across Canada develop and administer tailor-made group insurance plans. AGA was founded in 1978 and has been owned and operated since 2013 by veteran insurance executives Martin Papillon, Chantal Dufresne and Gabriel Gagnon. AGA serves more than 1,200 clients across the spectrum from small and medium-sized businesses to those with national footprints. It employs more than 100 professionals, including a team of actuaries and a network of external brokers, with offices in Montreal and Quebec City.

“AGA has built a first-class franchise that combines passionate experts with a culture of innovation,” said Marcel Larochelle, Managing Partner, Financial Services, at Novacap. “This is a unique attribute in any business, and it is what fascinated us from the very beginning of our conversations. It speaks to the strength of the Novacap platform that we have been able to attract such a renowned group of partners in Martin, Chantal, and Gabriel.”

AGA is the third investment of the Novacap Financial Services I fund since its first closing in November 2019. Novacap is the first private equity firm in Canada to launch a fund dedicated to investing in financial services businesses.

“Novacap is excited to assist AGA with our deep operational expertise, our experience in executing mergers and acquisitions and in developing new markets across Canada and beyond,” added Rajiv Bahl, Senior Partner, Financial Services, at Novacap. “We look forward to working with the management team to power AGA’s continued growth.”

“Partnering with Novacap is a privilege for my partners and all AGA employees, as we all have exactly the same ambitious vision for the future of the company,” said Martin Papillon, President and Chief Executive Officer of AGA. “Our mission is to facilitate access to group insurance and pension plans, and to streamline their administration for our customers. This pledge is reflected not only in exceptional service, but also strategic advice that allows us to provide more in terms of solutions, products and services. With Novacap as our partner, these capabilities will only be enhanced.”

Fasken Martineau DuMoulin LLP acted as legal advisor to Novacap.

Gowling WLG (Canada) LLP acted as legal advisor to AGA.

About Novacap
Founded in 1981, Novacap is a leading Canadian private equity firm with CA$3.6 billion of assets under management. Its distinct investment approach, based on deep operational expertise and an active partnership with entrepreneurs, has helped accelerate growth and create long-term value for its numerous portfolio companies. With an experienced management team and substantial financial resources, Novacap is well positioned to continue building world-class businesses. Backed by leading global institutional investors, Novacap’s deals typically include leveraged buyouts, management buyouts, add-on acquisitions, IPOs, and privatizations. Over the last 39 years, Novacap has invested in more than 90 companies and completed more than 140 add-on acquisitions. Novacap has offices in Brossard, Quebec and Toronto, Ontario. For more information, please visit www.novacap.ca.

About AGA Financial Group Inc.
Since its inception in 1978, AGA has helped clients across Canada develop and administer tailor-made group insurance plans. AGA is also one of Quebec’s leading third-party administrators and third-party payers (TPA / TPP) of group insurance and retirement plans. Its clients include over 1,200 small, medium and large businesses, as well as financial security and group insurance consultants wishing to make a group insurance plan available to their clients. AGA has a Quebec-wide distribution network and more than 100 employees across its offices in Montreal and Quebec City.

SOURCE Novacap Management Inc.

Related Links

http://www.novacap.ca

 

Millennial Money: 6 Great Recession lessons that still apply

Millennial Money: 6 Great Recession lessons that still apply

By Melissa Lambarena Of Nerdwallet

THE ASSOCIATED PRESS

The Great Recession demolished jobs across the U.S., and it eventually came for mine, too. After graduating in 2009, I worked four months as an entry-level executive assistant at a non-profit before being laid off.

I had limited financial knowledge, a short work history and a lot to prove to break into the field of journalism, my ultimate goal. Along the way, I picked up valuable lessons that might help you manage your finances during the coronavirus-related recession.

1. SAVE WHAT YOU CAN

My short work history disqualified me from receiving unemployment benefits, so I relied on my savings account. Even a small emergency fund of $500 can prevent you from falling into debt, and I had socked away enough to cover a few months of expenses.

If you’re still employed, “pay yourself first,” said Samuel Deane, a financial planner at Deane Financial in New York. “Even if it’s $20 every time you get paid, make sure you put that $20 away first and then live your lifestyle with the remainder.” Automate it with direct deposit if you can.

If you’ve lost your job, saving will obviously be tougher. Apply for unemployment if you qualify, and contact your landlord, creditors, area nonprofits and family members to seek relief. If you’re still employed but have had your salary cut, consider a side gig and work on trimming expenses.

2. THINK TWICE BEFORE REJECTING JOB OFFERS

After many interviews and dead ends, I applied for an administrative role at an accounting firm and got hired in December 2009. It paid about $7,000 less than my previous salary. I knew it wouldn’t put my career on track, but it would cover most of my bills, so I took it.

Amanda Grossman, now a certified financial education instructor in El Paso, Texas, made similar compromises after being laid off as a market researcher in Florida in 2008. She took a career counsellor’s advice and relocated to Texas for a lower-paying job in the environmental industry.

“(The counsellor) said, `Look, the economy is not doing well. You need to take that job, it’s going to keep going down; you’re not going to be able to find work,”’ Grossman said.

If your sector is hurting and unemployment benefits or savings are lacking, even a less-than-ideal role can help you ride out a recession.

3. GET SMART ABOUT MONEY

You’ll find a myriad of financial literacy resources online and at your local library, assuming it is open and safe to visit during the pandemic.

I struggled to save money on a lower salary. Credit cards became my emergency fund. I don’t recommend this approach, but times were tough. Had I learned about financial hardship programs, student loan repayment options or balance transfer credit cards, I would have saved heaps on interest and ditched debt faster.

4. ESTABLISH MULTIPLE STREAMS OF INCOME

I still wanted journalism experience and extra income, so on top of my new full-time job, I learned to shoot and edit video. I began freelancing in 2010. A year later, I also launched a small social media consulting business.

Grossman, too, had other goals. “I’ve always wanted to be a writer and I love, love, love talking about money,” she said.

While she was unemployed in Florida, she launched the blog “Frugal Confessions.” She learned new writing skills from books and sought feedback from editors at newspapers. In 2013, she left her environmental job in Texas to run her blog full time.

5. PROTECT YOUR CREDIT BUT PROTECT YOURSELF FIRST

In a crisis like COVID-19, many normal financial rules don’t apply. You may need to carry a credit card balance to buy groceries or address an emergency. You may need to make only the minimum payment to cover rent. You may even need to contact your card issuer and ask for relief options like payment deferrals.

Even with three jobs, I struggled at times to make the minimum payments on my credit cards due to high balances and interest rates. I never defaulted, but I did stress and scramble over it. I wanted a record of on-time payments and the good credit they build so that I could qualify for future low-interest rate offers.

That’s a worthy goal, but in times of emergency, prioritize getting back on your feet first. Once you do, you’ll have time to address your credit scores.

6. MAKE CALCULATED MONEY MOVES

Eventually, I left my apartment and moved in with roommates. I also read the post-recession climate and, in successive jobs, learned how to ask for a raise. Every year that my workload and responsibilities increased, I made a case for a higher salary. Asking is uncomfortable at first, but it gets easier. The extra money eventually paid off my debts.

A recession’s impact is largely out of your control, but your reaction isn’t. With strategic steps, you can insulate yourself and create new opportunities.

_______________________________

This article was provided to The Associated Press by the personal finance website NerdWallet. Melissa Lambarena is a writer at NerdWallet. Email: mlambarena?nerdwallet.com. Twitter: ?lissalambarena.

RELATED LINKS:

NerdWallet: COVID-19 and your money: Our guide to getting relief and managing your finances http://bit.ly/nerdwallet-covid19-guide

Consumer Financial Protection Bureau: An essential guide to building an emergency fund http://bit.ly/consumer-finance-start

Federal Deposit Insurance Corporation: Money Smart Online Tools https://fdic.gov/consumers/consumer/moneysmart/learn.html

 

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