TORONTO, Aug. 29, 2017 /CNW/ - The Canadian Council of Insurance Regulators (CCIR) published its Strategic Plan 2017-2020 on June 27 (link). The new plan outlines the priorities and initiatives of the CCIR for the next three years. However, consumer protection issues related to the sale of segregated funds—originally identified as a priority in 2014—remains a key objective for the CCIR for the foreseeable future.
The CCIR has engaged in a review to assess the regulatory framework of segregated funds to identify whether changes were necessary, particularly in light of recent regulatory reforms affecting similar investment products.
In May of 2016, the CCIR's Segregated Funds Working Group published an issues paper for public consultation. With an emphasis on treating the customer fairly, the paper sought feedback on the potential for gaps in the current regulatory framework and the information required to ensure that customers receive helpful and meaningful disclosures.
Since the closing of the consultations on the issues paper, the CCIR has analyzed the input it has received and continued to work with key stakeholders on critical issues related to the segregated funds initiative. In the fall, the CCIR intends to publish a position paper outlining its recommendations and expectations. The recommendations will refer to issues such as the delivery of the Fund Facts document for subsequent transactions, risk classification methodology, oversight of sales, needs-based analysis, updating of client records and know-your-product due diligence requirements.
The CCIR will also publish a prototype disclosure document, identifying minimum required information on performance as well as on fees and charges. The prototype disclosure document is expected to be released in winter 2018, following consumer opinion testing.
"Ensuring that customers have the information needed to understand not only how their segregated funds are performing, but also their full costs is of the utmost importance to us." Anatol Monid, Chair of the Segregated Funds Working Group said.
The CCIR's work in this area is expected to result in significant changes in the regulation of segregated funds; changes that are intended to ensure customers better understand the costs and performance of their segregated fund investments.
Further information on the segregated funds initiative is available on the CCIR's website (www.ccir-ccrra.org).
About the CCIR:
The Canadian Council of Insurance Regulators is a national association of insurance regulators that traces its roots back to 1914. The mandate of the CCIR is to enhance insurance supervision and regulation to serve the public interest and to foster increased cooperative supervision and information sharing among regulatory authorities.
SOURCE Canadian Council of Insurance Regulators (CCIR)
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