CCIR/CISRO adopt reciprocal licensing agreement

The Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organizations (CISRO) have adopted a reciprocal licensing model for the insurance agent/broker licensing system in Canada.

The reliance model incorporates greater harmonization for agent and broker application forms, continuing education requirements and errors and omissions insurance for agents and brokers.

It is intended to harmonize the requirements faced by agents and brokers who are licensed or want to be licensed in multiple jurisdictions and by insurance companies with agents in multiple jurisdictions.

The model is not intended to require jurisdictions to introduce any additional licensing requirements where they do not currently exist. According to the model, “a host jurisdiction relies on most of the requirements of the agent’s or broker’s home jurisdiction, but could request that the agent or broker meet further requirements specific to the host jurisdiction.”

Currently, six Canadian jurisdictions require agents and brokers to secure continuing education credits. Under the agreement, Alberta, Saskatchewan, Ontario and the Chamber that administers CE for general agents and brokers in Qubec have agreed to not impose any further CE requirements on a non-resident agent or broker who has met CE requirements in their home Canadian jurisdiction as long as that jurisdiction requires CE.

With regard to errors and omissions insurance, according to the proposal, jurisdictions that currently limit the maximum policy deductible will accept a policy where the first dollar of any claim is to be paid directly to the claimant to be equivalent to a zero deductible. Ontario (applicable to life agents), Qubec and Newfoundland and Labrador are the three jurisdictions that currently limit the size of the policy deductible.

Although Ontario, Newfoundland and Labrador are able to adopt this approach, Qubec requires a regulation change before it can be implemented.