ALBERTA INSURANCE COUNCIL
(the “AIC”)
In the Matter of the Insurance Act, R.S.A. 2000 Chapter I-3
(the “Act”)
And
In the Matter of Jason Speed
(the "Agent")
DECISION
OF
The Life Insurance Council
(the “Council”)
This case involved an allegation pursuant to Section 481(2) of the Act. Specifically, it is alleged that the Agent failed or refused to provide information and documentation requested by an AIC investigator within the time specified in a Demand for Information (the “Demand”). In so doing, it is alleged that he contravened s. 481 of the Act.
Facts and Evidence
This matter proceeded by way of a written Report to Council dated January 30, 2017, (the “Report”). In October 2016, the AIC launched a pilot project to audit Continuing Education (CE) credits that licensees disclosed on their application. The AIC sent an email to agents randomly selected from a pool of agents who submitted their certificate renewal application(s) on the last day of the May 1, 2016 to June 30, 2016 renewal period. These agents were asked to provide proof of CE credits for the past 3 licensing periods from 2013 to 2016. This investigation was opened as the Agent failed to provide the AIC with records. The Report was forwarded to the Agent for review and to allow the Agent to provide the Council with any further evidence or submissions by way of Addendum. The Agent did not respond to the Report.
The AIC emailed the Agent on November 2, 2016 and provided him 30 days to respond to the CE audit. The investigator at the AIC then reminded the Agent by email on December 1, 2016 that he had not responded to the audit request sent by the AIC. The Agent responded back to the investigator’s email on December 1, 2016 and advised he was not sure what the audit was about. The Agent also advised that he had been ill for the past 2 years and was diagnosed with stage 4 liver disease and had not been an active agent since. He offered to call the investigator. On December 2, 2016, the investigator emailed the Agent to call him at his earliest convenience. However, the Agent did not call the investigator. The investigator emailed the Agent on December 9, 2016 advising him about the CE documents he needed to submit to complete his audit. Having not heard back from the Agent, on January 4, 2017, the investigator sent the Agent a DEMAND for information. The investigator advised the Agent by email on January 24, 2017 that he had missed the deadline to respond to the DEMAND for information and that the investigator would be proceeding with a report to council. On January 25, 2017, the Agent responded, once more advising the investigator about his health issues and asking if he “could resign from the AIC”. The investigator emailed the Agent on January 25, 2017 to advise him that he still needed to complete the audit even if he did not wish to continue with a career in the insurance field. The Agent emailed the investigator on January 25, 2017 advising him that he could acquire the CE certificates and provide the same as well as once again requesting to speak with the investigator. On January 26, 2017, the investigator emailed the Agent to call him back and once again provided him with a list of CE documents he needed to pass the audit. However, the Agent never called the investigator nor did he provide the CE documents needed to pass the audit. To date the AIC has not received a written response from the Agent
Discussion
The AIC operates under a delegation from the Minister of Treasury Board and Finance (the “Minister”). Through this delegation, the AIC has authority matters relating to current and former holders of insurance agent certificates of authority. Section 481 states that “[t]he Minister may direct the holder or former holder of a certificate of authority to provide to the Minister within a reasonable period of time specified by the Minister relating to the matters in section 480(1).” Subsection 2 states that the “… person served with a direction under subsection (1) who has the information must provide the information in accordance with the direction.”
Regulatory offences such as these are strict liability offences. As such, the AIC has the onus to prove that the Demand was properly made upon the Agent (proper in the sense that they meet all of the requirements under the Act) and that the Agent did not comply. Once this occurs, the onus shifts to the Agent to establish that he exercised due diligence in meeting his statutory requirement to respond. To substantiate this due diligence defence, the Agent must demonstrate that he took all reasonable means to avoid the offence.
The evidence is clear that the AIC investigator was attempting to determine whether the Agent had complied with his continuing education requirements. In furtherance of this investigation, the investigator sent the Demand to the Agent and the Agent did not respond. Given these facts, the onus shifts to the Agent to prove that he took all reasonable means to respond as required. As he did not reply to the Report or provide any additional evidence or submissions, the Agent has failed to prove that he acted with due diligence and we find him guilty failing to respond to the Demand.
In terms of the applicable sanction, the public relies on the AIC to investigate complaints and the Act requires that holders and even former holders, such as the Agent, provide information when called upon to do so. Therefore, the public is not well-served when agents simply ignore demands like those made in this case. In this case, the Agent has ignored the investigation. Pursuant to s. 13(1)(b) of the Certificate Expiry, Penalties and Fees Regulation, A.R. 125/2001, the Council has the discretion to assess a civil penalty in an amount up to one thousand dollars ($1,000). Normally, the civil penalty that we would assess in these in these types of cases would be in the range of the $1,000.00 maximum. However, in light of the Agent’s health condition, the Council hereby imposes a penalty of five hundred dollars ($500.00). The civil penalty must be paid within thirty (30) days of the mailing of this Decision. If the civil penalty is not paid within thirty (30) days, interest will begin to accrue.
Pursuant to s. 482 of the Act, the Agent has thirty (30) days in which to appeal this decision by filing a notice of appeal with the Office of the Superintendent of Insurance.
This Decision was made by way of a motion made and carried at a properly conducted meeting of the Life Insurance Council. The motion was duly recorded in the minutes of that meeting.
Date: March 16, 2017
KENNETH DOLL
Kenneth Doll, Chair
Life Insurance Council
Extract from the Insurance Act, Chapter I-3
Appeal
482 A decision of the Minister under this Part to refuse to issue, renew or reinstate a certificate of authority, to impose terms and conditions on a certificate of authority, to revoke or suspend a certificate of authority or to impose a penalty on the holder or former holder of a certificate of authority may be appealed in accordance with the regulations.
Extract from the Insurance Councils Regulation, Alberta Regulation 126/2001
Notice of appeal
16(1) A person who is adversely affected by a decision of a council may appeal the decision by submitting a notice of appeal to the Superintendent within 30 days after the council has mailed the written notice of the decision to the person.
(2) The notice of appeal must contain the following:
a) a copy of the written notice of the decision being appealed;
b) a description of the relief requested by the appellant;
c) the signature of the appellant or the appellant's lawyer;
d) an address for service in Alberta for the appellant;
e) an appeal fee of $200 payable to the Provincial Treasurer.
(3) The Superintendent must notify the Minister and provide a copy of the notice of appeal to the council whose decision is being appealed when a notice of appeal has been submitted.
(4) If the appeal involves a suspension or revocation of a certificate of authority or a levy of a penalty, the council's decision is suspended until after the disposition of the appeal by a panel of the Appeal Board.
Address for Superintendent of Insurance:
Superintendent of Insurance
Alberta Finance
402 Terrace Building
9515-107 Street
Edmonton, Alberta T5K 2C3