Frequently Asked Questions
After we’ve made initial contact we’ll set up a time to meet. This appointment will serve two purposes. Firstly, you get to interview me to see if I’ll be a good fit as your insurance advisor. The second purpose is for me to listen and learn about what matters to you the most. By the end of our first meeting, as your ‘potential’ advisor, I would like you to feel comfortable, looked after, heard and assured your best interests are addressed. With your consent I can apply all the needs we discussed and research your custom-tailored plan.
We can also use this time to set up our second meeting to review all of our options. Once we determine the right plan, we can use this second appointment to initiate this process. With this complete, we can then submit your application to our chosen Insurance Carrier.
What can I expect after I submit my insurance application? What to Expect PDF
The Harmonized Life Licence Qualification Program (HLLQP) is 120 hours of course content. There are a total of 8 exams to write. The certificate level consists of 4 exams, and once all 4 are passed successfully you can then apply to write the last 4 exams for licencing. Once you have passed the licencing exam and before you can apply for your licence with the Alberta Insurance Council – an advisor must find a ‘sponsor’ to facilitate licencing. This can be done two ways, applying for regular employment through a captive agency or becoming an independent broker and securing a contract through a Managing General Agency (MGA).
The MGA acts as a middle person between all the insurance carriers and the advisor. To obtain a contract with an MGA an advisor goes through a comprehensive background check to ensure there is no history of criminal activity, fraud and the likes. Additional measures include credit checks and Canada Revenue Agency (CRA) reviews, certification, employment and academic verifications too. As the middle person the MGA wants to ensure it is contracting sound advisors with sound backgrounds and financial footing. Especially if providing advice in the area of Insurance and Finance.
There are additional background checks that are conducted on a ongoing basis. Once contracted, the Alberta Insurance Council then requires the advisor to obtain his sponsorship with a selected insurance carrier. As a broker, such as my case, you are not limited to one.
The insurance company then repeats the above background checks before granting the advisor with a contract. Once a contract is obtained the advisor can then apply for a Licence with the provincial regulator which then conducts its own review of the applicant to ensure there are no conflicts of interests or other areas of concern. To maintain this licence an advisor must stay current with industry changes by obtaining continuing education credits. There are annual targets for this. If you haven’t already – please also read ‘Am I graded on what I sell my clients’?
I like this question since as a consumer, it's your right to know how your insurance advisor is paid. As it relates to insurance products I am paid a percentage by the insurance carrier and the Managing General Agency. Depending on the policy it could also provide annual compensation to service the client. These percentages can vary from product to product and I am happy to include this information to you as we weigh in on your options for transparency.
To run an independent brokerage there are several fixed costs involved. To remain active, I have to keep my provincial licence current - annually. My practice and home office must also be insured. There are also costs to ensure your information as my client remains private. To remain up to date with industry information and product changes, as licenced agents we have to meet annual continuing education credits. My secure client database and analysis program are significant expenses paid for annually. There is also auto expenses for traveling to and from appointments along with associated car insurance in the mix. Like any other business there are also general office expenses that can add up too.
The quick answer is no. My time spent with you in determining the right product all the way through to servicing your lifetime of changes are factored into the commission structure paid by the Insurance company and the Managing General Agency.
There are no cancellation fees. However, I would ask if you need to cancel that you provide me with as much lead time as possible so that I can make changes to my schedule as well. I can promise you that I will provide you with the same courtesy should something interfere with our appointment.
As an independent broker, I have access to over 15+ carriers. Of this range the basket of goods that I represent are: RBC, Manulife, Industrial Alliance, Equitable Life and Canada Protection Plan. This group provides me competitive and comprehensive policies for living benefits along with a solid range of options for life insurance needs. If a special case necessitates looking outside of this group – I would have the flexibility to do so.
As an independent broker I don’t have an employer or boss to report too. However, my access to all of Canada’s insurance carriers is done through a Managing General Agency (MGA). Let's call this the middle man between advisor/client and the insurance carrier. By contrast advisors that are not independent brokers do not have an MGA and may only have access to one carrier (which means limited selection to you the client). The policies I place through the MGA are reviewed and a target of 9/10 is set. What this means is out of 10 policies secured, only 1 should come back as a ‘return’ (to use retail terms). This return or cancel rate is set to ensure advisors are selling clients the most appropriate products. Your needs must be the focus. Ideally you would want this rate to be 100% but the reality is life happens and we can’t control unexpected things such as divorces and other unexpected life changes. Therefore, by putting your interests first this figure should naturally land in the 90% range. Make sense?
After completing your medical questionnaire on the application, this information is reviewed by the Insurers underwriting department. Each carrier has its own guidelines and practices. In addition to coverage definitions this is where two policies will differ from carrier to carrier. The underwriter’s main objective in reviewing your medical and financial history is to determine if the applicant represents optimal, standard, rated or uninsurable risk. Each of these risk categories represents associated price bands for premiums and will vary from one insurer to the next. The underwriter also has the ability to determine if certain limitations, exclusions or pre-existing conditions may or may not come into play when considering your policy.
This organization works very similar to a credit bureau for financial institutions. When you apply for a loan at the bank, or cell phone service, register for utility services they may order a credit check to see your history and ability to pay back loans. The MIB’s role with insurance applications is to verify past insurance applications. It alerts insurance carriers to errors, omissions or past misrepresentations made on applications. If you were declined coverage in the past this event will likely be shown on your MIB report. You have access to your MIB file by contacting www.mib.com/facts_about_mib.html
To illustrate riders, let’s compare this to purchasing a new vehicle from the dealership. Most cars have a base model available. The insurance equivalent can be (but not limited to) your Life, Disability, or Critical Illness policy. Cars also have the ability to have options and accessories added to their base model. This would be ‘riders’. Riders can add one or many different layers of function and value. Like with vehicles, they also increase the purchase price. The benefit of riders is that you can customize your policy to your needs and wants. There are numerous riders available with each insurer with some specializing in their own. Some common riders are: Family coverage, child protection, disability waiver, paid up insurance, accidental death, guaranteed insurability, terminal illness, parent/payor waiver benefit, accelerated death benefit, dread disease, occupation definitions, to name a few of a pool of many. Some popular ones you may have heard of is return of premium. This is where a percentage or your premiums paid into a policy are returned to you based on no history of claims, cancellation or death of the insured.
As a family, we support Women in Needs (WINS) through ongoing clothing and furniture donations. We are also huge fans of The Magic of Christmas which provides families in need and their children with Christmas gifts. This December 2018 will be our 8-year old’s 3rd Christmas as a Volunteer for this organization. Another one of our favorite charities is Brown Bagging. This organization provides lunches to students across Calgary who do not have the means for lunch. As a family we have volunteered (including our 8-year-old) in preparing several hundred sandwiches and snacks.