Life insurance companies, brokers and agents

Life insurance companies, brokers and agents must fulfill specific obligations as required by the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) and associated Regulations, to help combat money laundering and terrorist activity financing in Canada.

For the purpose of the PCMLTFA and associated Regulations, a life insurance company is a life company or foreign life company to which the Insurance Companies Act applies or a life insurance company regulated by a provincial Act. A life insurance broker or agent is a person or entity that is authorized under provincial legislation to carry on the business of arranging contracts of life insurance.

If you are a life insurance company, or an entity that is a life insurance broker or agent, that offers loans or prepaid payment products to the public, or maintains related loan or prepaid payment product accounts, you are considered to be a financial entity for those activities. This does not include:

You can find more information about financial entity obligations on the main financial entity webpage.

Life insurance companies, brokers and agents, described above, are responsible for the following requirements under the PCMLTFA and associated Regulations.

If you are a life insurance broker or agent that is acting as a managing general agent (MGA), you are not subject to these requirements.

If you are a life insurance agent and an employee of a life insurance company or broker, these obligations are the responsibility of the life insurance company, except with respect to reporting suspicious transactions, which is applicable to both you and your employer.

*Note: On June 1, 2021, regulatory amendments, which will create or change obligations for all reporting entities (REs) subject to the PCMLTFA and associated Regulations, will come into force. FINTRAC expects that REs will comply with the amended Regulations, but will exercise flexibility in assessing and enforcing compliance with certain record keeping and reporting requirements. See the Notice on forthcoming regulatory amendments and flexibility for more information.

Table 1—Summary of requirements for life insurance companies, brokers and agents
Category of requirement under the PCMLTFA and associated Regulations Requirements
Compliance program

Life insurance companies, brokers or agents must implement a compliance program. A strong compliance program will form the basis of meeting all of your regulatory requirements. For more information, see Compliance program requirements and the Risk assessment guidance.

Know your client

Life insurance companies, brokers or agents must verify the identity of persons and entities for certain activities and transactions, and carry out other customer due diligence activities, as described below:

When to verify the identity of persons and entities
Life insurance companies, brokers or agents must verify the identity of persons and entities when conducting certain transactions and activities. For more information, see When to verify the identity of persons and entities – Life insurance companies, brokers and agents.

Methods to verify the identity of persons and entities
Life insurance companies, brokers or agents must verify the identity of persons and entities using the methods prescribed by the PCMLTFA and associated Regulations. For more information, see Methods to verify the identity persons and entities.

Business relationship requirements
Life insurance companies, brokers or agents enter into a business relationship with a client the second time they are required to verify the identity of that client. For more information, see Business relationship requirements.

Ongoing monitoring requirements
Life insurance companies, brokers or agents have ongoing monitoring requirements when they enter into a business relationship with a client. For more information, see Ongoing monitoring requirements.

Beneficial ownership requirements
Life insurance companies, brokers or agents must obtain and take reasonable measures to confirm the accuracy of beneficial ownership information for entities. For more information, see Beneficial ownership requirements.

Third party determination requirements
Life insurance companies, brokers or agents have third party determination requirements when they are required to submit certain reports and keep certain records. For more information, see Third party determination requirements.

Politically exposed persons (PEP) and heads of international organizations (HIO) requirements
Life insurance companies, brokers or agents are required to take reasonable measures to make PEP and HIO determinations for certain activities or transactions. If a life insurance company, broker or agent determines that a person is a PEP or a HIO then they have additional related requirements. For more information, see Politically exposed persons and heads of international organizations guidance and Politically exposed persons and heads of international organizations guidance for life insurance companies, brokers and agents.

Reporting

Life insurance companies, brokers or agents must submit the following reports to FINTRAC:

Suspicious transaction reports 
For more information, see:

Terrorist property reports  
For more information, see:

Large cash transaction reports 
For more information, see:

Large virtual currency transaction reports 
For more information, see:

24-hour rule
Life insurance companies, brokers or agents have 24-hour rule requirements for large cash transaction reports and large virtual currency transaction reports. For more information, see Transaction reporting guidance: the 24-hour rule.

Record Keeping

Life insurance companies, brokers or agents must keep certain records, including records related to transactions and client identification. For more information, see Record keeping requirements for life insurance companies, brokers and agents.

Foreign branches, foreign subsidiaries and affiliates

Life insurance companies, brokers or agents have foreign branches, foreign subsidiary, and affiliate requirements. For more information, see Foreign branches, foreign subsidiaries and affiliates requirements.

Ministerial directives

Ministerial directive requirements apply to all reporting entity sectors. For more information, see Ministerial directives and transaction restrictions.

Penalties for non-compliance

FINTRAC has the legislative authority to issue administrative monetary penalties (AMPs) to reporting entities that are found to be non-compliant with the PCMLTFA and associated Regulations. For more information, see Penalties for non-compliance.

Glossary

The FINTRAC Guidance glossary includes terminology defined in the PCMLTFA and associated Regulations, as well as terms used throughout the guidance. For more information, see FINTRAC's Guidance Glossary.

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