Ontario’s Proposed MGA Rule Impacts Small Advisors and Risks Driving Up Costs and Accessibility of Advice for Consumers

Advocis urges the Financial Services Regulatory Authority of Ontario (FSRA) to revisit the proposed approach before introducing new fees and a rule that could significantly impact access to financial advice particularly when Canadians need this advice more than ever

Toronto, ON, Nov. 14, 2025 (GLOBE NEWSWIRE) -- FSRA is proposing a sweeping new rule that would capture thousands of small advisory businesses as “Managing General Agents” (MGAs), triggering costly licensing fees and compliance requirements that could make it harder and more expensive for Canadians to access trusted financial advice. This proposed rule will impact advisors across Canada who carry on business in Ontario.

Advocis is calling on FSRA to delay and revise its proposed rule, titled Life and Health Insurance Managing General Agents (Rule 2025-001), released on October 20, 2025. Advocis is strongly committed to working with FSRA on developing this important MGA licensing framework and will be submitting a formal comment letter in this regard.

“The expanded proposed rule may capture thousands of businesses who were never part of the original discussion without adequate time for meaningful consultation or clear justification for the change,” said Kelly Gorman, President and CEO of Advocis. “Our members are pillars in their communities. They are not large firms managing distribution networks. They’re running small businesses and helping Canadians make smart insurance and financial decisions. This proposed rule risks imposing an unnecessary burden on them and will lead to Canadians having less access to financial and insurance advice.”

The Issue:

The proposed rule introduces a new $1,000 application fee (plus renewal fees yet to be determined) for many advisors already licensed in Ontario.
It applies the definition of MGAs so broadly that even sole practitioners, partnerships, and incorporated agents with small teams may be swept in, many without even knowing it.
The proposed rule adds overlapping responsibilities and confusing compliance obligations that are unclear even to legal experts.
The consultation period has been rushed, with only 30 days to respond to an extensively revised and expanded proposed rule.

“Ontario’s regulatory modernization and red-tape reduction principles aim to eliminate unnecessary administrative burdens and help small businesses,” said Gorman. “This proposed rule does the opposite. Regulation should protect consumers - not push out small advisory businesses.”

Who’s at Risk?

FSRA’s proposal could affect:

Thousands of independent agents and small advisory businesses across Canada who carry on business in Ontario
Succession planning for small advisory businesses
New professionals entering the industry who may now face higher barriers to entry creating an advice gap

Advocis believes the real question is who isn’t at risk of being captured under this expansive proposed rule?

Advocis Members Mobilize

Advocis is urging its members to speak up and is coordinating a member-wide grassroots advocacy campaign to urge FSRA and elected officials to reconsider this proposed rule. This includes:

Individual submissions to FSRA
Outreach to provincial lawmakers

What Advocis Wants

A targeted, proportionate definition of MGAs that reflects actual business realities
A clear, plain-language rule with no unnecessary duplication
Proper consultation timelines to allow for meaningful input from affected stakeholders
Coordination with other provinces to avoid further regulatory deharmonization

“We support effective regulation. But this proposal feels rushed, overreaching, and is out of step with what consumers and advisors need,” said Gorman. “The Ontario Government says it wants to reduce red tape and costs on small businesses. Now is the time to demonstrate that commitment.”

Submission deadline: November 19, 2025

Feedback can be submitted directly to FSRA via their website: https://www.fsrao.ca/engagement-and-consultations/consultation-fsras-updated-proposed-rule-2025-001-life-and-health-managing-general-agents

Jacquie Kilislian, Director, Marketing & Communications,
Advocis, The Financial Advisors Association of Canada
jkilislian@advocis.ca

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