Canada’s life and health insurance body will extend its consultation period with financial advisors regarding new compensation disclosure rules. The CLHIA announced it has postponed Guideline G19 – Compensation Disclosure in Group Benefits and Group Retirement Services – until January 1, 2019. This will allow the organisation more time to fully engage with the advisor community, which is a vital part of this process, explained CLHIA president and CEO, Stephan Frank.
"Advisors are valuable partners in delivering group benefits and retirement services to Canadians and their views on the new proposed standards and how to implement them are key,” he said. “Consultations began earlier this year and we are listening to their views. That is why we took the immediate step of pushing back the implementation date.”
Transparency on compensation has been an ongoing issue in the advisory space for years now. In 2016, CRM2 legislation laid out new reporting requirements for advisors over their fees. It is the CLHIA’s intention to bring group benefits and retirement planning similarly in line, with Guideline G19 their response. Regulation is a delicate topic in the investment space, with many advisors decrying excessive red tape. The CLHIA therefore have made the decision to consult with advisors and financial planners as part of a cross-country tour. A webinar on G19 will also take place on February 22, and the organisation is keen to get as much feedback as possible before the new standards are brought in.
"We need the help of advisors to ensure successful implementation and we are committed to partnering with them on the new standards," said Frank.
Announcing the new guideline last month, the CLHIA identified certain standards that could protect consumers. This included a requirement that all insurers disclose to employers all direct and indirect forms of compensation paid to advisors.
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