Two licences are better than one: Includes chart

All the planning firms surveyed in the Planners’ Report Card provide life insurance as part of their offerings. “Clients need insurance,” says Kevin Regan, executive vice president of financial services at Winnipeg-based Investors Group Inc. “You have your obligation as an advisor to address it, and you have your obligation to your business to address it.”

IG requires its reps to have an insurance licence or to acquire one within 12 months of joining the firm, Regan says.

On average, 89% of planners surveyed hold life licences. Of the 15 dealers surveyed, only three had less than 80% advisors with life licences. All planners surveyed at Mississauga, Ont.-based PFSL Investments Canada Ltd. and Toronto-based Money Concepts Canada are dually licensed. W.H.
Stuart & Associates, a mutual fund dealer based in Unionville, Ont., had the lowest proportion of dually licensed planners, with only 59%.

“I think of a planner providing a full financial planning service —meaning they would be dually licensed with a CFP,” says Gwyer Moore, chairman of Worldsource Financial Management Ltd. of Markham, Ont.

PIP’s Wolfond agrees. Some PIP reps don’t have life licences, he says. However, he adds, if an advisor is “going to be a true financial planner” he or she must carry a life licence.

There are only a few advisors at Montreal-based Laurentian Financial Services who are licensed only for mutual funds. “We expect that they will hold both insurance and mutual fund licences,” says Steve Cole, Laurentian’s national sales manager in Toronto.

Manulife Securities International Ltd. doesn’t require its reps to have an insurance licence, but Greg Gray, president and CEO, estimates that 90%-95% have insurance licences.

While firms recognize the importance of insurance as part of their service, the extent to which it contributes to revenue streams varies widely.

On average, insurance makes up 30% of revenue. Manulife scored highest, with 59%.
At Toronto-based Assante Corp., it makes up only 11%.

The dealers find it an important source of revenue. “Of the most successful offices that I’ve seen, insurance is a very important part of their revenue stream,” says Scott Sinclair, president and CEO of Toronto-based Money Concepts and AEGON Dealer Services Canada Inc.

Yet support for insurance sales varies widely, too. As might be expected, Manulife planners can call on their Manulife Financial Corp. colleagues across the country for help. Assante provides insurance support, too. IG has 40 insurance specialists across the country, despite having insurance revenue of only 13%. W.H. Stuart says it has one person on staff that helps out.
Planners’ ability to choose how they channel their insurance business — which MGA they use — varies from firm to firm and depends on the firm’s infrastructure.

“If they have an insurance license, we expect them to contract for the sale of insurance products through the firm,” says Laurentian’s Cole. The managing directors of Laurentian’s regional centres are MGAs, he adds.

IQON Financial Inc. of Winnipeg offers a full-service MGA through its partnership with Assante’s insurance services team. “So it’s a fully integrated approach to insurance within the dealership,” says COO Jan Sampson.

ADSCI reps can choose their own MGA. But reps at the firm’s sister organization, Money Concepts, cannot choose, says Sinclair.
Money Concepts reps must use the firm’s Toronto-based MGA, National Financial Insurance Agency Inc.

At Peak Investment Services Inc., planners can take advantage of the company’s insurance dealer, Peak Insurance Services Inc. W.H. Stuart also has an insurance arm, W.H. Stuart Insurance Agency Ltd.
IE