Ontario Launches New Insurance & Financial Services Regulator

New Financial Services Regulatory Authority of Ontario (FSRA) will help reduce regulatory burden

Toronto, ON (June 7, 2019) – The Government of Ontario has launched a new provincial regulator of financial services and pensions. The Financial Services Regulatory Authority of Ontario (FSRA) combines and replaces the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO) as an integrated, independent and self-funded regulatory body for financial services and pensions.

The FSRA is empowered, responsive and open to change to help achieve better outcomes for industry and the public. It officially took over the regulation of financial services and pensions in Ontario effective June 8, 2019.

“The Financial Services Regulatory Authority of Ontario is a modern and innovative regulator with rule-making authority that promotes strong financial services and pensions sectors while protecting the public interest,” said Finance Minister Vic Fedeli. “Its mandate is to be open — open to new ideas, open to business, and open to consumer needs. FSRA has the flexibility to cut red tape, bring products to market quicker and be more responsive to the needs of businesses.”

The new regulator will oversee pronvincial financial services providers, excluding securities which are regulated by the Ontario Securities Commission, and will tackle key priorities in its first year of operation that will reduce regulatory burden for regulated sectors.

The FSRA will regulate Ontario’s insurance sector, pension plans, loan and trust corporations, credit unions and caisses populaires, mortgage brokers and service providers who invoice auto insurers for statutory accident benefit claims.

In particular, FSRA is instrumental to the government’s priorities including reforming auto insurance to increasing access and affordability for drivers, and to establishing title protection for financial planners and financial advisors to enhance consumer protection without introducing unnecessary regulatory burden.

“Our government recognizes that making Ontario open for business means making sure financial services are efficient, responsive to consumers and businesses — FSRA will play a vital role in helping businesses grow while protecting consumers,” said Fedeli.

The Ministry of Finance will administer FSCO’s Dispute Resolution Services until June 30, 2020. During the transitional period, all open cases will continue; however, no new proceedings will commence. As of July 1, 2020, any remaining cases will be extinguished, with parties able to start a new proceeding with the Licence Appeal Tribunal.

Welcome to the FSRA

Effective June 8, 2019, the Financial Services Regulatory Authority of Ontario (FSRA) assumed regulatory duties of the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO). Learn more about FSRA and its approach to achieving safety, fairness and choice in non-securities financial services.

Today, change is everywhere. Technology has become pervasive – an inescapable part of our personal and professional lives and a dynamic force for change in society. Constant change is the new normal. At the same time, and has been noted by others, while things have never been this fast, they will never be slow again.

Few industries know this better than financial services.

We’re now in a market where insurance companies offer a number of investment products. Defined contribution pension plans can look like an RRSP account. Defined benefit pension plans merge, transfer assets and grow in members; credit unions sell insurance and offer investment advice. Technology drives auto insurance into a new age with behaviour tracking devices, vehicle ownership giving way to on-demand mobility solutions, driverless vehicles inching closer to reality and so much more. New financial products and services hit the market constantly, but too many can be held back by regulations.

The new Financial Services Regulatory Authority of Ontario (FSRA) is empowered, responsive and open to change to help achieve better outcomes for industry and the public. As a regulator and manager of the province’s eco-system of financial services, we are empowered to see the public treated fairly and transparently while reducing red-tape and burden on industry.

We want everyone winning in a competitive market, while ‘smartly’ regulated to achieve better outcomes. It’s called ‘principles-based regulation’ – we’re responsive to changes in the marketplace, while ensuring safety, fairness and choice.

FSRA inherited 1,100 pieces of guidance and we’re paring them back significantly by eliminating, combining and refreshing the regulations. Where paper was the norm, electronic streamlining of forms and processes will be the standard. We’re listening to learn and work with our sectors.

Still, questions abound. Are the age-old distinctions between personal auto insurance and commercial insurance relevant? How do we ensure all company pension assets held in trust are managed under fiduciary standards expected in Ontario? What about innovative, new products and services coming to market daily? What tests should apply and how quickly should regulatory approval be given?

We want to encourage behaviour change. Our principles-based approach should lead to industry players policing and self-governing to maintain the high standards we want to promote and Ontarians should expect. The burden reduction and regulatory effectiveness, complete with checks and balances, will aid business and serve the public with secure pensions, credit union deposits and innovative products and services at competitive prices.

FSRA will regulate with respect, transparency and collaboration and will focus its efforts based on the risks to stakeholders and consumers.

About the new FSRA

The Financial Services Regulatory Authority of Ontario (FSRA) is an independent regulatory agency created to improve consumer and pension plan beneficiary protections in Ontario.

FSRA was established to replace the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO). The agency is flexible, self-funded and designed to respond rapidly to an evolving commercial and consumer environment. In this capacity, FSRA will:

• Promote high standards of business conduct
• Foster a sustainable, competitive financial services sector
• Respond to market changes quickly
• Promote good administration of insurance and pension plans
• Encourage innovation

Sectors we regulate:
The newly created agency protects Ontarians by regulating:

• Property and casualty insurance
• Life and health insurance
• Credit unions and caisses populaires
• Loan and trust companies
• Mortgage brokers
• Health services providers (related to auto insurance)
• Pension plan administrators
• Financial planners and advisors (proposed)

Legislative mandate:

• Regulate and generally supervise the regulated sectors
• Contribute to public confidence
• Monitor and evaluate developments and trends
• Promote public education and knowledge
• Promote transparency and disclosure of information
• Deter deceptive or fraudulent conduct, practices and activities

About the Financial Services Regulatory Authority of Ontario

The Financial Services Regulatory Authority of Ontario (FSRA) is an independent regulatory agency created to improve consumer and pension plan beneficiary protections in Ontario.

FSRA was established to replace the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO). The agency is flexible, self-funded and designed to respond rapidly to an evolving commercial and consumer environment.

Learn more at www.fsrao.ca.

Source: Financial Services Regulatory Authority of Ontario (FSRA)

Tags: Financial Services Commission of Ontario (FSCO), Financial Services Regulatory Authority of Ontario (FSRA), Ontario Read the original article at Insurance-Canada.ca