Canadian Life and Health Insurance Association Inc.

Insurance Distribution




In 2016, the CLHIA Board of Directors endorsed a series of ten recommendations aimed at enhancing outcomes for customers and, in some cases, closing regulatory gaps related to the distribution of life insurance. These recommendations reflect an industry commitment to maintaining a strong customer focus and having policies and procedures that protect customers.

Recognizing distribution’s unique and specialized role in treating customers fairly, the Board then considered how different distribution structures can better serve the needs of customers and meet insurers’ compliance obligations. We found that, to meet consumer demands, insurers’ distribution models have evolved over the years to include a variety of channels (e.g., MGA, national account, and career channels). However, our existing regulatory structure for distribution, and the accompanying oversight obligations, most closely reflects a period when most insurers sold their products through a traditional career sales force.

In this paper we outline the industry’s resulting position that a fundamental change is required to improve advisor oversight. Specifically, we believe that a regulatory licensing and oversight regime is required to establish distribution firms as distinct, licensable entities with certain advisor oversight responsibilities. Introducing such a regime would not change an insurers’ existing compliance obligations, rather, it would provide the necessary tools to allow insurers to meet regulatory expectations for proactive compliance programs that are focused on fair outcomes for consumers.

  Improving Advisor Oversight - Helping consumers to be sure they’re secure

CLHIA Policy Paper
June 2017





Maintaining a strong customer focus and having processes and procedures that protect customers has long been the fundamental underpinning of insurance legislation, marketplace regulation and the life and health insurance industry in Canada. More recently, the concept has emerged as a central tenet in the Insurance Core Principles of the International Association of Insurance Supervisors.

Given the global focus on managing market conduct risks and fostering a customer-focused culture, the Canadian Life and Health Insurance Association (CLHIA) decided to review practices surrounding the distribution of individual insurance from the perspective of the consumer. This report contains a number of recommendations intended to enhance the current system and ensure a robust, world-class environment for insurance customers in Canada.

  Promoting a customer-focused system
CLHIA Policy Paper
February 2016