Understanding Voluntary Undertaking Agreements

About Voluntary Undertaking Agreements

Part of the license application process is determining that licensees are not in positions of power that place themselves at an advantage over their clients or have occupations that place them in a conflict of interest that prevents them from fulfilling their duties as an insurance agent.

From the legislation: the individual must not be in a position to use coercion or undue influence in order to control, direct or secure insurance business; the individual must not be engaged in another occupation or business that would place the individual in a conflict of interest position when acting as an insurance agent.

Occupations

The following occupations may prevent an applicant from receiving, renewing, reinstating, or retaining a license to practice insurance-related services due to a potential conflict of interest, or the potential to use undue influence or coercion in order to control, direct, or secure insurance business:

• Government employees (federal, provincial, and local municipalities)
• Politicians and legislators
• Religious and spiritual leaders
• Legal profession: members of the Judiciary, lawyers, and members of the Law Society of Alberta (or other legal societies within Canada)
• Law enforcement: RCMP, municipal police, penitentiary staff, probation officers, behavioural correctional staff (remand centers etc.), youth justice workers, and investigators
• Administrative law panels: members of an arbitrative administrative law panel (on matters of appeals or eligibility)
• Health professionals: physicians, psychiatrists, psychologists, counsellors, mediators, social workers, therapists, mental health clinicians, and the staff who support them
• Medical examiners, crisis intervention workers, registered nurses (RNs), front-line nurses, residential care workers, out-patient support, rehabilitative and palliative care workers
• Vulnerable sector employees: those working with outreach, public access, or charitable programs (both private and public) who assist a vulnerable sector of the public
• Maintenance enforcement workers, bailiffs, collections staff, or pawnbrokers
• Corporate franchise tax preparers
• Immigrant and newcomer support workers (private or public)
• Volunteer workers in any of the above fields

These professions are provided as a guideline only. The Councils reserve their authority to decide all matters of eligibility on the basis of the facts before them in relation to any request to retain, renew, reinstate, or receive a new license.

What to do if you hold another occupation:

The Councils have elected to offer eligible applicants the option to enter into a Voluntary Undertaking Agreement (VUA). VUAs are only offered to an eligible applicant seeking to obtain, renew, reinstate, or retain licenses, who holds another occupation which may place the applicant in a position to exercise coercion or undue influence in order to control, direct, or secure insurance business, and the undue influence can be eradicated through a VUA.

Each application is reviewed on a case-by-case basis. However, an applicant will be denied the opportunity to enter into a VUA if:

1. They are an officer, employee, or an independent contractor of a deposit-taking institution other than a special purpose trust company within the meaning of the Loan and Trust Corporations Act or sales finance company; or
2. Where, when acting as an insurance agent, the applicant’s other occupation gives rise to:
   • a real conflict of interest;
   • a potential conflict of interest;
   • a apparent conflict of interest; or
   • undue influence which cannot be eradicated through a VUA.

Those occupations may include but will not be limited to:

1. Government agencies (i.e. Canada Revenue Agency, Canada Border Services Agency, or law enforcement)
2. Politicians and legislators.

The Councils reserve their authority to decide all matters of eligibility based on the facts before them in relation to requests to obtain, renew, reinstate, or retain a license. As well, the Councils maintain their delegated authority to consider the nature of any other occupation, beyond those outlined above, which may give rise to the potential of undue influence and/or may present a conflict of interest.

Any questions regarding this may be directed to the Director of Legal and Regulatory Affairs for the Alberta Insurance Council.

Read the full Notice to the Profession and the Public – Voluntary Undertaking Agreements, originally posted June 2023.