IN THE MATTER OF the Insurance Act, R.S.O. 1990, c. I.8, as amended (the “Act”), in particular sections 392.4, 407.1, 441.2 and 441.3;

AND IN THE MATTER OF Specialty Life Inc.

AND IN THE MATTER OF Insurance Supermarket Inc.

ORDER TO AMEND LICENCE AND IMPOSE CONDITIONS, AND IMPOSE ADMINISTRATIVE PENALTIES

Specialty Life Inc. (“SLI”) is licensed as a corporate life insurance agent (licence # 35751M). SLI was first licensed on March 24, 2016.

Insurance Supermarket Inc. (“ISI”) is licensed as a corporate life insurance agent (licence # 33237M). ISI was first licensed on October 22, 2009.

On May 22, 2026, the Director, Litigation and Enforcement (the “Director”), by delegated authority from the Chief Executive Officer (“Chief Executive Officer”) of the Financial Services Regulatory Authority of Ontario (“FSRA”), issued a Notice of Proposal to impose administrative penalties on SLI.

These Orders are made pursuant to a settlement entered into by SLI, ISI, and the Director. SLI and ISI consent to the imposition of conditions on their respective licences.

ORDER

For the reasons set out in the Minutes of Settlement it is hereby ordered that the licence issued to Specialty Life Inc. be amended and the following conditions be imposed:

I. APPOINTMENT OF AN INDEPENDENT MONITORING FIRM

1. Specialty Life Inc. (“SLI”) will retain an independent monitoring firm (“Monitoring Firm”) within forty-five (45) days of the date hereof. The Monitoring Firm must agree to carry out the steps described herein.
2. The Monitoring Firm must have the necessary experience to carry out the conditions and be free of dealings with SLI, Insurance Supermarket Inc. (“ISI”) or SLI’s ownership group or affiliates, or any related corporations thereto (collectively the “Corporations”) that could create an actual or perceived conflict of interest. Where there is a non-material conflict, whether actual or perceived, the Monitoring Firm shall separate, through an ethical wall, the personnel within the Monitoring Firm who are carrying out this engagement from any other personnel within the Monitoring Firm who have such dealings with SLI. The President and/or a Director of SLI shall certify that the Monitoring Firm meets these conditions.
3. SLI is responsible for retaining and compensating the Monitoring Firm.

II. SLI AND MONITORING FIRM’S DELIVERABLES

4. The Monitoring Firm will independently review SLI’s policies, procedures, staffing (including adequate numbers of staff and expertise) and any other elements the Monitoring Firm considers reasonably necessary (collectively the “Systems”) to validate whether SLI has a compliance system in place reasonably designed to prevent misrepresentations in the registration of insurance.
5. In addition, in carrying out its validation, the Monitoring Firm shall confirm whether SLI has commercially reasonably effectively addressed issues raise by the frauds that occurred between 2019 and 2023 and put in place a compliance framework consistent with the actions identified in its previous correspondence with FSRA dated April 10 and 17, 2026.
6. The Monitoring Firm will identify any issues with SLI’s System (e.g. anything which could reasonably be interpreted as submitting a misrepresentation in the registration of insurance). The Monitoring Firm may make recommendations, arising in the course of its engagement, relative to such Systems, as it deems appropriate, and SLI will give commercial reasonable consideration to any such recommendations.
7. SLI will confirm to the Monitoring Firm which recommendations it intends to implement and which it will not be adopting. SLI shall provide an explanation for any recommendations it chooses not to implement. Where implementing a recommendation, SLI will provide the Monitor with an implementation plan (the “Plan”). The Plan will describe SLI’s existing System, resources required to implement the recommendations, timelines for implementation and timelines for testing to validate that the implementation has been successful. Such timelines for implementation shall not exceed March 31, 2027, unless the Monitoring Firm reasonably determines, in its professional opinion, that a longer timeline is necessary for specific deliverables, with an ultimate deadline of June 30, 2027.
8. The Monitoring Firm will independently validate whether the Plan is effective to achieve the objectives set out in paragraph 4. If the Plan is not effective, SLI shall work with the Monitoring Firm to prepare a revised Plan (the “Revised Plan”) and shall agree with the Monitoring Firm as to a reasonable date for implementation of the Revised Plan. Should the Revised Plan, in the Monitoring Firm’s opinion, not adequately address the objectives set out in paragraph 4, it will report accordingly to FSRA immediately.
9. The Plan, or Revised Plan, shall be implemented by SLI by no later than March 31, 2027, or as extended under Paragraph 7. After implementation the Monitoring Firm will validate that the Plan, or Revised Plan, has been fully implemented, tested, any deficiencies identified through testing remediated (and where appropriate retested), and that the Plan is working effectively, to achieve the objectives set out in paragraph 4.
10. The Monitoring Firm shall deliver a final written report thereon (“Final Report”) to FSRA, with a copy to SLI and its Board of Directors and External Auditor.
11. The Monitoring Firm shall be engaged until the requirements of these conditions have been addressed and until all other terms of these conditions have been met, including all reporting obligations and follow-up as set out herein.
12. Any delay or a failure to perform solely attributable to the Monitoring Firm is not a breach by SLI of these conditions. If the Monitoring Firm continues to fail to meet deadlines or to perform, FSRA may direct SLI to retain another Monitoring Firm in accordance with paragraph 1.
13. SLI acknowledges that FSRA, acting reasonably, is not bound to accept the Monitoring Firm’s conclusions and retains the right to reasonably access the work of the Monitoring Firm throughout its engagement and review/audit SLI as reasonably necessary pursuant to its authority under the Act.
14. All reporting and information to be submitted to FSRA, including the certificate from the Chief Executive Officer of SLI under paragraph 2 and the Final Report of the Monitoring Firm under paragraph 9, shall be provided to the Director, Litigation and Enforcement (“Director”), FSRA.
15. These conditions shall terminate 60 days after the Monitoring Firm delivers its Final Report.
16. SLI shall advise the Director, promptly and in writing of any changes to its current business model, including any use of any agents not directly employed or contracted by SLI, use of any managing general agents (“MGAs”), or third party administrators (“TPA”). SLI shall identify how it will oversee any such arrangements to ensure there are no misrepresentations in the registration of insurance.

ORDER

For the reasons set out in the Minutes of Settlement it is hereby ordered that the licence issued to Insurance Supermarket Inc. be amended and the following conditions be imposed:

17. Insurance Supermarket Inc. shall not acquire a majority interest in Specialty Life Inc. or any other MGAs, TPA, or other insurance intermediary located in Ontario or operate as a such itself in Ontario.

ORDER

Four administrative penalties in the total amount of $800,000 are hereby imposed on Specialty Life Inc., for the reasons set out in the Minutes of Settlement.

TAKE NOTICE THAT Financial Services Regulatory Authority of Ontario will deliver an invoice to Specialty Life Inc. as to where and how to pay the administrative penalties. Specialty Life Inc. must pay the administrative penalties no later than thirty (30) days after the date of this Order or as otherwise agreed on.

If Specialty Life Inc. fails to pay the administrative penalties in accordance with the terms of this Order, the Chief Executive Officer may file the Order with the Superior Court of Justice and the Order may be enforced as if it were an order of the court. An administrative penalty that is not paid in accordance with the terms of the order imposing the penalty is a debt due to the Crown and is enforceable as such.

DATED at Toronto, Ontario, May 25, 2026.

Original signed by

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Officer

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