Life Agents Errors and Omissions Insurance Canada

Get Life Agents E&O insurance Canada fully online with us!

Trust. It’s at the heart of what you deliver as a life insurance agent in Canada. Above all, it’s why Canadians need your expertise as a life agent when it comes to purchasing life and health insurance products.

When you work as a life agent you are sought out as a trusted resource by individuals and families. Your clients want products that will provide them with peace-of-mind as well as confidence for the future. In other words, people count on you for expert financial advice.

In addition, as a life agent, you work hard to understand the specific needs of your clients and match them with the best possible insurance products. However, sometimes mistakes can happen. This is why it is important to get the best life agents’ errors and omissions insurance Canada.

From Victoria, BC to Toronto, Ontario to Halifax, Nova Scotia and beyond, our ALIGNED Insurance brokers deliver E&O insurance that precisely fits the needs of life agents.

Risky business | Situations that life agents need to watch for

Every job comes with inherent risks. When you work as a life agent, financial transactions are an important part of your day-to-day activities. But when money changes hands, the potential for risk exposures increase. This is why the Government of Canada provides specific guidance for assessing common money laundering and terrorist financing risks that life insurance agents may encounter. Most importantly, products, services, delivery channels, geography, clients, business relationships are among the many risk areas that you need to monitor.

Here are a few examples of high-risk client situations you may encounter:

  • “Client produces documentation that appears to be counterfeit, altered or inaccurate.
  • A client who has policies with multiple institutions, without reasonable explanation or discernible purpose.
  • A client requests an insurance product for no discernible purpose and is reluctant to divulge the reason for the investment. 
  • The client’s investment in insurance products is disproportional to their economic profile. 
  • A client cancels an investment or insurance policy soon after purchase. 
  • A client shows more interest in the terms of cancellation or surrender of an insurance contract than in the long-term results of the investment or the costs associated with terminating the contract. 
  • The client accepts very unfavourable conditions that are unrelated to his or her health or age.”1 

Meanwhile, here some high-risk transaction situations that you should be on alert for:

  • “Frequent and unexplained movement of accounts, policies, contracts, or funds to different insurance companies or other financial institutions.
  • Unusual payment methods, payment frequency or payment value.
  • Unexplained early redemption or unexplained redemption with important penalties. 
  • The first payment (premium) to pay for the insurance policy is from a foreign bank account.”2

You can find more specific details about risks you need to assess in the Risk-Based Approach Workbook for Life Insurance Companies, Brokers and Agents.

Your life agents licence may require E&O insurance Canada

Errors and omissions insurance for life agents not only protects you, but depending on where your business is located, it may be also mandated by your provincial government. For instance, in Ontario:

“By law, all licensed life insurance agents are required to have errors and omissions (E&O) insurance in a form approved by the Superintendent in an amount of at least $1 million in respect of any one occurrence, with extended coverage for loss resulting from fraudulent acts. Extended coverage may be included directly in an E&O insurance policy contract, or in an endorsement to a contract. Life insurance agents are required to maintain E&O insurance coverage at all times while licensed, regardless of whether or not they are actively selling insurance products.3

Source: Financial Services Commission of Ontario: Errors and Omissions Insurance Requirements for Life Insurance Agents

Ready to use the ALIGNED 100% ONLINE Life Agent insurance tool?

That’s great! Before you get started, there’s some information you’ll need to have on hand when you are buying your online insurance.

For example, some questions you can expect when buying your online life agent E&O coverage include:

  • Are you a licensed Life Agent or licensed Accident & Sickness Agent?
  • What provinces and territories are you licensed as a Life Agent?
  • How much coverage would you like for your E&O?
  • What is your business address?
  • What is your estimated annual gross revenue for the next fiscal year?
  • Other than Canada, are you licensed in any country to sell Life or Accident & Sickness insurance?
  • Are you aware of facts or circumstances that may give risk to an E&O claim being made?
  • In the past 10 years, have you experienced any errors or omissions judgements?

In conclusion – we make it fast, simple and easy to get your E&O insurance online now!

Aligning the products you need, when you need them most is just another way that we deliver a different insurance experience. You can learn more about what sets us apart here.

Our focus on providing important insurance insights here on our website, through our e-newsletter ALIGNMENT Matters and our social media channels will always be a cornerstone of our business.

Source(s): 1,2 Government of Canada: Risk-Based Approach Workbook for Life Insurance Companies, Brokers and Agents; 3 Financial Services Commission of Ontario: Errors and Omissions Insurance Requirements for Life Insurance Agents

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