On February 23, 2026, the Financial Services Regulatory Authority of Ontario (“FSRA”) announced that it is pausing work to finalize its proposed Rule establishing a new licensing regime for Life and Health Managing General Agents (“L&H MGAs”).
The proposed framework had been targeted for implementation in advance of related Insurance Act amendments coming into force. FSRA has indicated that next steps will be communicated in due course.
Background: 2024 Amendments to the Insurance Act
In 2024, the Ontario government amended the Insurance Act to create a statutory framework requiring managing general agents in the life and accident and sickness insurance sector to be licensed in Ontario. Those amendments introduced a new definition of “managing general agent” in section 407.2 of the Act and contemplated that FSRA would implement a corresponding Rule to operationalize the licensing regime.
Section 407.2 provides that a person or entity is acting as a managing general agent when, pursuant to an agreement, it facilitates the sale of life or accident and sickness insurance by engaging in activities such as:
- Recruiting agents or prospective agents
- Screening agents for suitability
- Providing training
- Supervising or monitoring agents
- Entering into written agreements with agents
- Recommending agents to insurers
- Transmitting insurance applications or policies between insurers and agents
- Engaging in other prescribed activities set out by FSRA rule
This definition is broader than the traditional industry understanding of an MGA and permits additional activities to be prescribed by rule.
Proposed Rule 2025-001
In January 2025, FSRA published Proposed Rule 2025-001 – Life and Health Insurance Managing General Agents. The Rule set out licensing requirements, compliance obligations, and supervisory expectations for L&H MGAs.
The proposal underwent two rounds of public consultation, with the most recent consultation closing in November 2025. Throughout the consultation process, stakeholders raised concerns about the potential scope and impact of the new regime.
Industry Concerns Regarding Scope
One of the central concerns raised during consultation was that the statutory definition of “managing general agent” may be overly broad. Some industry participants argued that the definition could capture corporate insurance agencies and other entities that are not traditionally considered to operate as MGAs.
In particular, many corporate agencies that contract with insurers and perform one or more of the listed activities — such as entering into agreements with agents or transmitting applications — could fall within the statutory definition. If so, those entities could be required to obtain an additional L&H MGA licence once the regime is implemented, potentially resulting in overlapping licensing and compliance obligations.
Stakeholders also expressed concerns about proportionality, compliance burden, and potential impacts on smaller agencies.
FSRA’s Decision to Pause
FSRA has now announced that it is pausing work on finalizing the proposed Rule. While the regulator has not provided detailed reasons, the pause follows significant industry feedback during the consultation process.
Addressing stakeholder concerns about the scope of the MGA definition may require regulatory refinement and, potentially, legislative amendments to the Insurance Act. At this time, FSRA has not indicated when work on the Rule may resume.
What This Means for the Industry
For now:
- The proposed L&H MGA licensing regime is not moving forward.
- Entities that may have anticipated licensing requirements under the new framework do not need to take immediate action.
- Industry participants should continue monitoring communications from FSRA and the Ontario government for updates.
We will continue to monitor developments and provide updates as further information becomes available.
