How to Become an Insurance Agent

Canada’s financial services industry is dynamic and growing fast. Life insurance is just one of many financial services – others are banking, trusts, and investing. Life insurance companies are a large and vital contributor to Canada’s economy in addition to being a major employer, with over 130,000 people working in the business.

According to the Canadian Life and Health Insurance Association, a trade organization that represents Canada’s life and health insurers, the insurance industry is one of the largest investors in the Canadian economy with almost $475 billion in assets held in Canada. For an industry profile, see www.clhia.ca.

Becoming a life insurance agent can be a great career choice, with many employment opportunities and lots of room for personal growth and advancement.

The answers to the following questions will explain some of the basic information for those intending to become an agent. They include information about the new LLQP introduced on January 1, 2016.



What is the career potential for a life insurance agent?

Where will I find a job?
What will I sell as an agent?
What are the steps to becoming a life insurance agent?
What happens if I move to another province?
What is needed to keep my license after I get it?
Who provides training to become a life insurance agent?
Which training company is best?
What about the provincial exam?
When I’m a life insurance agent, do I get a professional accreditation?
Is there another way to become licensed besides the LLQP?
What other accreditations are available to those who sell life insurance and financial products?
Who are the life insurance regulators?

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 What is the career potential for a life insurance agent?

Qualified life insurance agents are in demand by life insurance companies, banks and investment dealers, and independent insurance providers called brokers and managing general agencies (known as MGAs). Given that the average age of a life agent now is 62, the demand for new agents will escalate over the next few years as existing life agents begin to retire.

Becoming a life insurance agent is an excellent career choice for those who enjoy meeting and helping people, like flexible hours, and are prepared to work hard in return for a generous salary, commission, and bonus package. Plus, you have the option of becoming self-employed by becoming an independent financial broker. Take a look at http://www.ifbc.ca.

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 Where will I find a job?

You can become a career agent, in which you will represent the products of a single company or become an agent who represents many different companies.

Sun Life is one company that employs career agents and London Life is another. Their websites describe many of the benefits of becoming an employee agent:
www.sunlife.ca/Canada/sunlifeCA/Careers?vgnLocale=en_CA
www.londonlife.com

Most insurance now is sold through a broker or managing general agency (MGA). If you work for a broker or an MGA, you will represent the products of many companies to your clients. For instance, you could offer policies to your clients from Manulife, Transamerica, and Canada Life.

Here’s a useful website:
www.financialadvisorjobs.ca/advocis/index.htm

Here’s a list of insurance companies with the types of insurance each sells:
www.olhi.ca/company_listing.html


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 What will I sell as an agent?

As a life agent you will sell life insurance policies, health insurance policies, disability insurance, group insurance, business life and disability insurance, and two types of investments: annuities and segregated funds.

Life insurance policies fall into two broad categories: insurance for a period of time (term insurance) and insurance until death (called permanent insurance). There are several forms of permanent insurance.

Health insurance policies provide supplemental coverage to the government health insurance all Canadians enjoy. Health insurance is the umbrella name for travel insurance, dental plans, insurance for prescription drugs, vision care, critical illness insurance, and long-term care insurance. Travel insurance is vital for anyone traveling outside Canada, whether for a weekend, a week, or a protracted stay abroad, such as that made by snowbirds or students.

Disability insurance is a form of insurance that provides income replacement when a person can no longer work because of sickness or an accident.

You might want to choose to get a license only for health insurance sales and service. In this case, health and disability insurance are the only forms of insurance you will sell. Group insurance policies are sold to businesses that want to provide an employee benefit in the form of health and disability insurance. Sometimes life insurance is also provided as a group policy.

Business life and disability insurance is insurance intended to protect small businesses against the death or disability of one of the business owners or partners.

Life insurance agents sell annuities and segregated funds as investments. An annuity is an investment that requires the investor to make a deposit and, then, that deposit plus interest is repaid at regular intervals. A segregated fund is like a mutual fund in many ways except it provides a guaranteed return on investment.



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 What are the steps to becoming a life insurance agent?

The new LLQP was implemented on January 1, 2016. It changes the study process and the exam for those who want to become a life insurance agent:

  1. Enroll in the life licensing qualification program (LLQP) offered by qualified providers;
  2. You will receive five study modules: Life Insurance, Accident & Sickness, Segregated Funds and Annuities, Ethics and Professional Practice, and Taxation. You can study these in any order your prefer: we suggest starting with Accident and Sickness Insurance, then Life, then Ethics, then Seg Funds. Your provider may suggest another approach.
  3.  There is a provincial exam for every module except Taxation. Your provider will set the means by which you be certified to write the provincial exams ---- a certification exam is usual. The pass mark is set by each individual provider;
  4.  Pass the provincial exams in the province where you live; this requires a mark of 60% or greater. Although each exam is “open book,” students cannot use the printed version of the study modules. A tablet will be provided for use during the exams and students should not rely on finding answers verbatim in the tablet;
  5.  After passing all four exams, join an insurance provider;
  6.  Apply for your license for the province in which you will work (your employer may take this step on your behalf); you will need to pay a fee, and clear any background checks insurance regulators require.
  7.  Acquire errors and omissions (E&O) insurance; this is a form of professional liability insurance that will protect you from client claims against mistakes you inadvertently make; your employer will help you find an E&O company; E&O insurance is not optional.

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 Quebec

Quebec follows a distinct training procedure as specified by the Autorité des Marchés Financiers (AMF). Some details are provided below. Also see:
www.lautorite.qc.ca/en/insurance.html


Requirements for those who want to sell life insurance (called insurance of persons) are:


Step 1: Satisfy the minimum qualifications

The minimum qualifications for the insurance of persons sector are as follows:
Diploma of Collegial Studies from Québec;
Diploma of Collegial Studies (DCS) in Insurance and Financial Advisory Services;
Attestation of collegial studies in insurance of persons recognized in an agreement to that effect between the AMF and a Québec college-level institution;
University-level certificate in insurance of persons recognized in an agreement to that effect between the AMF and a university;
Two certificates of 30 credits each from a Canadian university;
Bachelor’s degree, specialized graduate diploma (D.E.S.S.), Master’s degree or doctoral degree from a Canadian university;
Decision issued by the AMF recognizing a level of education equivalent to the Diploma of Collegial Studies;
Decision issued by the AMF recognizing workplace skills;
Comparative evaluation for studies done outside Québec issued by the ministère de l’Immigration et des Communautés culturelles du Québec indicating a minimum of 13 years of studies.


Step 2: Pass the AMF examinations

The AMF requires future professionals to pass the following examinations in order to ensure they have the necessary skills to properly advise clients.
- Applying the legal concepts and legislation pertaining to insurance of persons and to the activity of a representative in the insurance of persons sector
-Applying taxation concepts to professional practice – Insurance of Persons
-Preparing an individual life insurance plan adapted to a client's needs, in particular on the basis of an analysis of the client’s financial situation and ability to pay the premium
-Preparing an individual disability insurance plan adapted to a client's needs, in particular on the basis of an analysis of the client’s financial situation and ability to pay the premium
-Preparing a segregated funds proposal and an individual financial products plan adapted to a client's needs

An examination is valid for two years from the date passed. A failed exam may be rewritten three times.




Step 3: Complete a probationary period

Once you have passed all the required examinations, you must complete a 12-week probationary period where you will apply, in a real but supervised setting, the knowledge and skills necessary to practice your profession. Trainees must work a minimum of 28 hours per week. All successfully completed examinations must be valid when beginning the probationary period.

Step 4: Apply for certification

You must submit an application to the AMF before the validity of your examinations expires. If the validity expires during your probationary period, you have 30 days from the end of this period to apply.

While your application is being processed and on receipt of a notice to this effect from the AMF, the probationary certificate will remain in effect for a maximum of 45 days as of the end of the probationary period.

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Requirements for those who want to sell accident and sickness insurance are:

Step 1: Satisfy the minimum qualifications

The minimum qualifications are:
Secondary school diploma;
Attestation of an equivalent of Secondary V Studies (AESS);
Diploma of vocational studies;
Diploma of Collegial Studies from Québec;
Bachelor’s degree, specialized graduate diploma (D.E.S.S.), Master’s degree or doctoral degree from a Canadian university;
Comparative evaluation for studies done outside Québec issued by the ministère de l’Immigration et des Communautés culturelles du Québec, indicating a level of education equivalent to a secondary school diploma;
Title of Chartered Insurance Professional (CIP) issued by the Insurance Institute of Canada or Fellow Chartered Insurance Professional (FCIP) issued by the Insurance Institute of Canada;
Title of Fellow, Life Management Institute (FLMI) issued by the Society LOMA.

Step 2: Pass the AMF examinations

The AMF requires future professionals to pass the following examinations:
-Applying the legal concepts and legislation pertaining to accident and sickness insurance to the activity of a representative in the accident or health insurance sector class
-Preparing an accident and sickness insurance plan adapted to a client's needs, in particular on the basis of an analysis of the client's financial situation and ability to pay the premium

An examination is valid for two years from the date passed. A failed exam may be rewritten three times.


Step 3: Complete a probationary period


Once you have passed all the required examinations, you must complete a 6-week probationary period in a real but supervised setting. Trainees must work a minimum of 28 hours per week.


Step 4: Apply for a representative’s certificate


Submit an application to the AMF before the validity of your examinations expires. If the validity of your examinations expires during your probationary period, you have 30 days from the end of this period to apply.
What happens if I move to another province?

If you plan to work in more than one province, or if you move, you do not need to write the provincial exam again in that province. Quebec may be the exception; check with the AMF. You will apply to the provincial insurance regulator in that province and once you have provided proof that the exam has been passed once, you will receive your new license. You may have a license from more than one province at a time.

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 What is needed to keep my license after I get it?

To keep your license, you must renew it annually and pay the required fee, and have fulfilled the continuing education requirement for the province to which you are applying. CLIFE is an excellent provider of CE and we hope you’ll become our customer!

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 Who provides training to become a life insurance agent?

The following is a list of the current (as of January 2016) LLQP course providers:

  • Advocis/Foran
  • Business Career College (BCC)
  • Canadian Securities Institute (CSI)
  • Combined Insurance Company of America
  • IFSE Institute / IFIC
  • La Capitale Financial Security Insurance Company
  • London Life Insurance Company
  • Oliver's Learning
  • Primerica
  • Seneca College of Applied Arts & Technology
  • Sunlife Financial

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 Which training company is best?

Every LLQP course, whether it is provided as books, online learning, seminars, or webinars, follows the study modules provided by the Autorité des marchés financiers.

Therefore, every training company provides the same course. They differ in the supporting study material they provide and in the price they charge.

Here are some questions to ask LLQP vendors to help you find the package and provider that’s right for you. Call some providers and compare the answers to these questions:


1.    How is your program conducted:

a.    Self-study
b.    Teaching via in-class seminars (and where are those seminars held and when)
c.    Teaching via webinars (how often? when?)
d.    Other?
e.    Combination approach?

2.    What are the components of the program you offer?

a.    Book
b.    Online activities
c.    Exam preparation
d.    Webinars
e.    Pre-certification exam testing
f.    Other


3.   Who primarily purchases your LLQP?

a.    Students fresh from community college or university?
This answer will indicate a program written at a fairly high level and assume some degree of knowledge of financial services and finance.

b.    People seeking a new career?
This answer should indicate a program oriented towards people who do not have prior knowledge of Canadian financial services.

c.    People already working in the financial services industry?
This program will assume a high degree of knowledge about Canadian financial services, retirement, pensions, and investments.

4.    What is the pass rate on your Certification Exam?

5.    What is the pass rate for your students on the provincial exam?

6.    Where do I write my Certification Exam and how quickly do I receive the results?

7.    How often can I rewrite my Certification Exam?

8.    Who is the person I can speak to if I have questions about the content of the program? Has this person written the provincial exam and when? Did he or she pass?

9.    Can you give me a student reference I can speak to?

10.    Do you offer any guarantees?

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 What about the provincial exams?

The provincial exam for life insurance agents (outside Quebec) is a series of four exams based on the study modules Life Insurance, Accident and Sickness Insurance, Segregated Funds and Annuities, and Ethics and Professional Practice. All exams must be passed to become a life insurance agent.

Students are provided with a tablet since the exam are “open book.” However, a student should not expect to find answers to exam questions verbatim in the tablet, especially in the time allotted for each exam.

Candidates must register for their exam at least seven (7) business days in advance.

Candidates for an Accident and Sickness insurance agent licence must write the following modules:

  • Accident and sickness insurance
  • Ethics and professional practice*

Candidates must write the “Ethics and professional practice” module required in the jurisdiction(s) in which they are seeking a licence:

  • Ethics and professional practice (within the context of common law, for licensing in all provinces and territories except Quebec).
  • Ethics and professional practice (within the context of civil law, for licensing in Quebec)

There are 30 questions in each exam except Ethics, which has 20. All exams must be completed in 75 minutes.

All exams may be written on separate days or the same day. If written on the same day, the student can elect to have the exam marked on a compensatory basis, with a pass determined by the combined results of all four modules. This option is offered temporarily; check with Durham College to see if it is still available when you book.

Please note that a student must make his or her choice of a single exam or all four exams at the time you book your exam. You cannot switch models once that booking has been processed.

Before registering to write a provincial exam, students must register with the Canadian Insurance Participant Registry (CIPR). There is no cost to register. Here is the link.

To write the provincial exams, it is necessary to register with Durham College: link.

Entry to the exam is provided to those who have a Certificate from an authorized provider, have paid the fee, and can provide photo ID when arriving for the exam that matches the ID on the Certificate.

The exam may be written on paper, or online. The online exam should not be attempted by anyone without superior computer skills. Both exams require the student to read English or French quickly and accurately.

The pass mark is 60%. There are no breaks allowed during the exam for any reason.

Additional information about the LLQP may be found through the Canadian Insurance Services Regulatory Organizations (CISRO)  http://www.cisro-ocra.com

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Exam Administration

Durham College administers the PROVINCIAL LLQP exam for various provincial regulators.

The LLQP administration centre at Durham College is 9am - 3:30pm Monday - Friday (Eastern time). Candidates must register for their exam at least seven (7) business days in advance (exam sessions close to booking at 7:00AM each business day).

Registration may be done:

Directly online: LLQP Exam Information for Durham College
Fax: 905-721-3345
Phone: 905-721-3341
Toll free: 1-800-816-3615
Mail: 
Durham College, LLQP Department

1610 Champlain Ave,

Whitby,ON
L1N 6A7

LLQP exam fees are (per module):

Ontario: $24.50 (paper exam or computer exam)
New Brunswick: $35.00 (paper exam); computer exam not offered

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 When I’m a life insurance agent, do I get a professional accreditation?

No. LLQP is not a designation. See accreditations below.

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 Is there another way to become licensed besides the LLQP?

No.

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 What other accreditations are available to those who sell life insurance and financial products?

Life insurance agents who already have their licenses often pursue additional studies to enhance their knowledge and value to customers. These include the:

Certified Financial Planner® (CFP®): An internationally recognized designation provided in Canada by the Financial Planning Standards Council (FPSC). For more information, see www.fpsc.ca.

Chartered Financial Analyst (CFA): Offered by The Global Association of Investment Professionals, the CFA is internationally recognized and is generally undertaken by those seeking careers as mutual fund portfolio managers: see www.cfainstitute.org.

Chartered Life Underwriter® (CLU®): Offered by Advocis, the CLU is described as Canada’s premier wealth transfer and estate planning designation: see www.advocis.ca/education/CLU.html.

Fellow of Canadian Securities Institute (FCSI): The FCSI designation covers every aspect of financial services - investment management, financial planning, derivatives, and risk management: see www.fcsi.ca.

Registered Health Underwriter (RHU): This designation is offered by The Institute for Advanced Financial Education. This designation is being replaced by the Certified Health Insurance Specialist (CHS) designation starting September 1, 2011. This new designation is meant for advisors looking to specialize in the field of living benefits: see www.iafe.ca.

Fellow, Institute of Canadian Bankers (FICB): This designation is attained by those pursuing the management of financial service institutions: see
www.csi.ca/student/en_ca/designations/pbp.xhtml.

Fellow, Life Management Institute (FLMI): The FLMI is designated by LOMA, an international organization. It advances expertise in the operations, products and management of life and health insurance companies: LOMA also offers a number of other designations: see www.loma.org.

Registered Financial Planner™ (R.F.P. ®): Offered by The Institute of Advanced Financial Planners: see www.iafp.ca.

The Canadian Securities Institute and its affiliate the Canadian Bankers’ Association also offer the following designations:
The Chartered Strategic Wealth Professional (CSWP™):www.csi.ca/student/en_ca/designations/cswp.xhtml
Personal Financial Planner (PFP®):www.csi.ca/student/en_ca/designations/pfp.xhtml
Canadian Investment Manager (CIM):www.csi.ca/student/en_ca/designations/cim.xhtml
Member, Trust Institute (MTI®):www.csi.ca/student/en_ca/designations/mti.xhtml

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 Who are the life insurance regulators?

There is no national insurance regulator. The provincial regulators, whose responsibilities include agent licensing, are:

BC: Insurance Council of British Columbia

www.insurancecouncilofbc.com

Suite 300 - 1040 West Georgia Street
P.O. Box 7
Vancouver, British Columbia
V6E 4H1
Phone: 604-688-0321
Toll free within BC: 1-877-688-0321

AB: Alberta Insurance Council

www.abcouncil.ab.ca

Suite 600 Bell Tower,
10104-103 Avenue
Edmonton, Alberta T5J 0H8
Phone: 780-421-4148

SK: Insurance Councils of Saskatchewan

www.insurancecouncils.sk.ca

310 - 2631 - 28th Avenue
Regina SK  
S4S 6X3
Phone: 306-347-0862


MB: Insurance Council of Manitoba

www.icm.mb.ca

466 – 167 Lombard Ave.
Winnipeg, MB
R3B 0T6
Phone: 204-988-6800


ON: Financial Services Commission of Ontario

www.fsco.gov.on.ca

Financial Services Commission of Ontario (FSCO)

5160 Yonge Street

Box 85

Toronto, Ontario
M2N 6L9
Phone: 416-250-7250
Toll free: 1-800-668-0128



QC: There are two regulators in Quebec:

Autorité des Marchés Financiers

www.lautorite.qc.ca

Cite de Québec
Place de la Cité,
Tour Cominar
2640
Boulevard Laurier
Bureau 400

Québec (Québec)
G1V 5C1

Phone: 418- 525-0337


Montréal

800, square Victoria, 22e étage

C.P. 246
Tour de la Bourse

Montréal, QC
H4Z 1G3

Phone: 514-395-0337

Toll free: 1-877-525-0337


Institut québecois de planification financière

www.iqpf.org

4 Place du Commerce
Suite 420

Île-des-Soeurs
Verdun, Quebec
H3E 1J4
Phone: 514-767-4040

Toll free: 1-800-640-4050


NS: Nova Scotia Department of Finance

www.gov.ns.ca/finance/en/home/insurance/licensing/agents.aspx

Nova Scotia Department of Finance
PO Box 187
1723 Hollis St.
Halifax, NS
B3J 2N3
Phone: 902-424-5528 or 902-424-7551


NB: New Brunswick Ministry of Justice and Consumer Affairs

www.gnb.ca

Superintendent of Insurance
Department of Justice - Insurance Branch

Kings Place

P.O. Box 6000

Fredericton, NB

E3B 5H1
Phone: 506-453-2541 or 506-453-8548



PEI: Prince Edward Island Department of Justice and Public Safety; Consumer, Corporate, and Insurance Services

www.gov.pe.ca/jps/index.php3?number=1027199〈=E

Prince Edward Island
PEI Securities Office
Consumer, Corporate and Insurance Services Division
Department of Justice and Public Safety
95 Rochford Street
4th Floor, Shaw Building
Charlottetown, Prince Edward Island
Phone: 902-368-4550


NL: Newfoundland and Labrador Department of Government Services, Insurance, Pensions & Securities

www.gs.gov.nl.ca/insurance/index.html#insurance

Newfoundland and Labrador
Department of Government Services
P.O. Box 8700
St. John's, NL A1B 4J6
Phone: 709-729-2595