FSRA looks to boost consumer protection, confidence

FSRA looks to boost consumer protection, confidence | Insurance Business Canada

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FSRA looks to boost consumer protection, confidence

Its 2023-2026 plan prioritizes people, tech, and processes

The Financial Services Regulatory Authority of Ontario (FSRA) has unveiled its 2023-2026 Annual Business Plan, which aims to enhance consumer protection and confidence in Ontario’s evolving financial environment.

The three-year plan focuses on people, technology, and processes in a bid to achieve regulatory excellence, enabling the FSRA to better address emerging risks, build supervisory capacity, support innovation, and better protect and educate consumers.

The FSRA’s plan builds on its progress to meet the demands of the fast-paced financial landscape by adopting a principles-based, outcomes-focused approach and sector-specific supervisory plans. The Minister of Finance approved the plan on April 12, 2023, addressing expectations in the Minister’s mandate letter.

The FSRA consulted on the 2023-24 Statement of Priorities and Budget for transparency and incorporated feedback into the final ABP. The regulator said it continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone. FSRA provides prudential and/or market conduct regulation and supervision of various sectors, including property and casualty insurance, life and health insurance, pension plans, and financial planners and advisors.

The FSRA said that its property and casualty (P&C) insurance priorities will include:

Executing a strategy for reforming regulation of auto insurance underwriting and rates
Developing recommendations and acting on reforms of the auto insurance system
Ensuring the fair treatment of P&C customers
Achieving supervisory excellence for Ontario-incorporated insurance companies and the the reciprocals sectors

Within life and health insurance, the Ontario regulator said it would prioritize enhancing market conduct oversight to better protect consumers. Previous FSRA supervisory reports in the last two years have identified “risk and gaps” in market conduct compliance, particularly in “independent distribution channels such as managing general agents (MGAs)”, it said.

The FSRA said it is developing an evidence-based regulatory framework to “address potential risks and challenges” posed by MGAs. Further, it said it is building on its capacity for “proactive reviews” of life insurance agents, following the establishment of a dedicated supervision team in 2020 and a supervisory framework in 2022.