1. CF Canada Financial Group
Monthly Compliance Training Section 1 – Licensing Requirement Continuing Education Credit Requirement Licensee Profile Change Reporting Requirement Contracting Requirement Referral Fees and Rebating Thursday 5 April 2018

2. Licensing Requirement
Life Licensing Period:
- June 1, 2018 – 31 May 2019
- For licenses issued between 1 March 2018 and 31 May 2018, the first
filing date will be 1 June Council rule course must be completed
before the first filing date
filing fee is $190, after 1 June and before 31 July is $355
- After 31 July, your life license will be terminated automatically

3. Licensing Requirement
Continuing Education:
- All licensees must have completed 15 hours of continuing education
between 1 June 2017 – 31 May 2018, or part of this 12 months period
- For licenses issued between 1 March 2018 and 31 May 2018, the first
filing date will be 1 June Council rule course must be completed
before the first filing date and must have completed 30 hours of
continuing education
filing fee is $190, after 1 June and before 31 July is $355
- After 31 July, your life license will be terminated automatically

4. Licensing Requirement
Continuing Education: ( Continued )
- For licensees have life license for at least 5 of the last 7 years in a
Canadian jurisdiction, and you do not have a professional designation
you must have 10 technical hours of continuing education
- For licensees have an approved designation, you must have 5 technical
hours of continuing education ( CFP, CLU, RHU, FCIA, FLMI, CEBS )
- Some designations like CFP, CLU, FCIA are exempt from continuing
education requirement if they are in good standing as a holder of their
designation
- Excess credits cannot be carried over into the next license period

5. Licensee Profile Change Reporting
Licensee Profile Change Reporting Requirement:
- Licensee change of address and contact information ( within 30 days )
- Licensee change of name ( within 5 business days with a fee )
- Licensee has lost of authorization to represent an agency or firm
( 5 business days )
- Licensee has been disciplined, judged or convicted a criminal charges
- Licensee has new other business activities including being named as a
director, shareholder, executive management position of a corporation

6. Contracting Requirement
Licensee Responsibilities:
- Licensee notify Insurance Council of BC
- Licensee notify the agency or firm
- Licensee provides proof of changes in writing
- Licensee has good faith in disclosing changes

7. Referral Fees and Rebating
What is a referral fees?
- A fee or compensation may be paid to a unlicensed person
- A general insurance agent is considered to be a unlicensed person
- Before paying a referral fee, certain conditions must be met:
* the unlicensed person did not engage in any insurance activities which
include discussion with the potential client about the products, client’s need,
and the insurance products’ marketing brochures and materials
* a written disclosure must be provided to the client stating that the person is
being compensated for the referral, and must be provided before arranging
an insurance transaction.

8. Referral Fees and Rebating
What is a referral fees? ( continued )
- The referral fees must be a flat amount, and not directly or indirectly related to
the amount of client’s premium or coverage
- A copy of the written disclosure is strongly recommended to be kept in client
file as a proof of meeting this license condition
- A referral fee is a one time payment and should not be paid continuously to the
same client
- A written disclosure on potential conflict of interest to the client

9. Referral Fees and Rebating
Referrals: ( third party entities )
Professionals, center of influence, clients, friends or relatives:
- could be just a straightforward referral without any consideration
- joint venture business referring arrangement
- regular or irregular referrals
- may have written disclosure depends on structure of referral
arrangement

10. Referral Fees and Rebating
What is a rebate?
Life insurance is not a consumable product:
- a rebate means a life insurance agent pay a compensation directly to
the client in an attempt to convince the client to buy from the agent
- rebates shift client’s focus on incentives instead of values
- purchase decisions should be based on needs and affordability

11. Referral Fees and Rebating
How rebates work in BC?
Section 79 of BC Insurance Art:
- 31 December 2004 was amended to allow a premium rebate up to a
prescribed amount or percentage, payable be less than 25% of the
premium
- section 94 of the Act was amended to prohibit only coercive tied
selling of financial products

12. Referral Fees and Rebating
How rebates work in BC? ( continued )
- Rebate is not allowed and prohibited by all insurance companies in Canada
- Insurance companies will terminate the agent if there’s evidence to prove
the agent had committed rebating to clients

13. Next Compliance Training
Thursday 3 May 2018
Code of conduct & suitability

14. Thank you!
ANY QUESTIONS?