Monday, June 2, 2014

(No.265) Agents & the LLQP: a bridge too far?

"Life insurance agents and the proposed "harmonized LLQP":
a bridge too far?

by Alastair Rickard

I have written several columns expressing my scepticism about the plan from the provincial life insurance regulators in Canada who comprise CISRO (the Canadian Insurance Services Regulatory Organizations) to introduce a new modular regime (exams and content) to be developed by Quebec's AMF (the Autorite des marches financiers) for use in both Quebec and the common law provinces.

See, for example, the columns on (No.216) "CISRO's 'harmonizing': the life insurance agent licensing regime of LLQP revisited", posted Oct.8, 2012; (No.222) "CISRO, the AMF and a new LLQP life insurance licensing regime: to whose benefit?", posted Dec.9, 2012; and most recently (No. 262) "Regulator games-playing in insurance: agent licensing revisited", posted May 5, 2014.] 

The new regime has been given the designation of "the harmonized Life Insurance Licensing Qualification Program". The CISRO/AMF plan would replace the content and exams of the existing LLQP program (the Life Licensing Qualification Program), a program with the development of which I had more than a casual involvement a decade ago.

This 'son of LLQP' process initiated by the insurance regulators is, in CISRO's dealings with those directly concerned, every bit as arrogant in its presentation and the imposition of a plan to bring in a new LLQP regime as it was a decade ago.

In my comments about the 'harmonized LLQP' and other life insurance industry matters, I have stressed the core role played by active, selling life insurance agents; why regulatory actions which have the effect of needlessly complicating and therefore depressing entrance to the active agency system should be resisted; why Canadians are under-insured and the fact that Canda is NOT a mature market for individual life insurance.

Thus I was interested to learn, apropos of these and other of my comments about the need for more agents who are active in selling this core product, i.e., in providing genuine opportunities for Canadians to acquire it, of a discussion and Q & A session being presented in Toronto on June 4 this week by the Economic Club of Canada on the subject of "The Underinsured Market in Canada"

The panelists are Laura Dawson, the President of Dawson Strategic and Rickard Hekeler, a V-P of research at LIMRA/LOMA, the industry research and educational association. [For details go to] 

It should be a useful contribution to the long standing need for an effective antidote to the self-serving nonsense about Canada being a mature market for life insurance, nonsense much favoured by financial 'pundits' and industry executives alike.  


In response to various of my comments on the LLQP over time I have received some thoughtful views disagreeing with me from a person associated with one of the registered LLQP course providers. I received another such email in response to Column No. 262. It appears below in its entirety followed by my response.

"Mr. Rickard,
Have you gone through the LLQP as it currently stands?  I challenge you to enroll in an LLQP course and go write the provincial licensing exam as it currently stands.  Then tell me that the process as it currently stands is a proper licensing process.  The examination is a poor exam at best.  The last time any meaningful effort went into keeping the LLQP current was in 2006.  Since that time, no resources have been made available to those responsible for the LLQP to keep it current.

"If you are interested in pursuing this, I would offer you a complementary enrolment in my business’ LLQP certification process.  I believe that experiencing the provincial licensing exam might cause you to at least reconsider that the current process leaves much to be desired."

To which I replied as follows:

"Thank you for your comments in response to my recent column. They are worthy of a reply.

"However I do not intend to rehearse here the points I have made at length about the LLQP and its proposed "harmonization" in several RickardsRead columns. I have already spent far more of my time on the subject than is warranted given the other things of interest to me as potential subjects for columns.

"Therefore a few points only:

"1. Does the current LLQP regime need to be revisited, revised and enhanced after a decade in use?  Yes.

"2. Does the need to revisit LLQP mean the current redesign and redevelopment by Quebec's AMF is the best route or what is required?  No.

"3. Whose fault is it that the LLQP has not been revisited appropriately before now (as indeed it should have been)? Its official custodians in CISRO,
virtually all of whose key members today are the same regulators I and other industry stakeholders worked with on the original LLQP a decade ago,
and who retain the same powers of action they had a decade ago and during the years since.

"4. Do the current concerns by various informed stakeholders, including nearly all the LLQP course providers, about the sweetheart arrangement
cooked up between CISRO and the AMF before informing any stakeholders, mean the latter want the LLQP regime to remain unchanged?  No.

"Finally, I decline with thanks your offer to take a bog standard LLQP course. Even if its completion were to cause me to embrace willy-nilly your
assessment of the current LLQP regime it would not change by a scintilla the answers to the four questions above.

"My experience over the years leads me to observe that too often provincial insurance regulators offer tinned goods as fresh produce -- as
I suspect will turn out to be the case with the CISRO/AMF's 'Revised King James Version' of the LLQP.

"CISRO's self-righteous truth-mongering on the subject may seek to establish one 'harmonized LLQP' narrative to which everyone pays obeisance.

"Time will tell if that is a bridge too far."


Finally, in response to that same column on the 'new' LLQP I received a brief email from a life company executive who -- among other industry people -- was involved a decade ago in working with provincial insurance regulators in the original LLQP.

"BRAVO Al and thank the lord I am no longer involved!"

That is a sentiment with which I can agree.




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