While there is little regulation regarding financial advisors, there is considerable regulation regarding the tasks most financial advisors perform. You will need insurance, certification and multiple licenses to sell most securities and insurance policies, market yourself to employers and gain the respect of your clients. These licenses do not have college education requirements, though a bachelor's degree with a major, minor or extensive coursework in business or finance is helpful.
You obtain the primary Canadian securities sales license by completing the Canadian Securities Course. This course and the requisite exams are administered by the Canadian Securities Institute. The course requires about 135 to 200 hours of study and covers topics on various Canadian financial instruments, regulation, fundamental analysis and portfolio management. There are two exams you must complete with a score of at least 60 percent before receiving your certificate of completion. These exams contain 100 multiple-choice questions, and you will have two hours to complete each exam. Most students take the exams in computer-based testing centers throughout Canada. Once you complete the exam, you are able to sell stocks, bonds and mutual funds. The sale of derivatives and commodities requires specialized licensing.
You must complete a Life License Qualification program to sell life insurance. A number of private insurance companies and organizations provide these programs throughout Canada. Once this program is complete, you must register with the provincial board of insurance. Requirements vary, but typically you must be sponsored by an insurance provider throughout the early stages of your career. Requirements for registration or licensure for other types of insurance vary by province and may include sponsorship by insurance providers and passing a licensing exam.
Financial advisors typically seek certification as a Certified Financial Planner from the Financial Planning Standards Council. Though it is not required, the Certified Financial Planner designation is an industry standard certification that significantly increases your marketability and clout. The process involves several steps and takes about four to five years to complete. Candidates must first complete an FPSC-approved core curriculum education course, pass an initial exam and register with the FPSC. After working for one year, candidates must complete a capstone course, take a final examination and work for three more years before achieving full certification.
Errors and Omissions Insurance
Errors and omissions insurance is required for anyone selling life insurance and any financial advisors selling such products. This is a type of professional liability insurance, similar to malpractice insurance for doctors, that covers you in the event of lawsuits resulting from your professional conduct. Requirements regarding exact coverage amounts vary by province, but, as an example, a person selling life insurance in Ontario must have coverage of at least $1 million for a single incident, $2 million aggregate and extended coverage for fraudulent acts.
- Financial Services Commission of Ontario: Life Insurance Licensure
- Financial Services Commission of Ontario: Becoming a Licensed General Insurance Agent
- Financial Services Commission of Ontario: Errors and Omissions Insurance Requirements for Life Insurance Agents
- Canadian Securities Institute: Canadian Securities Course
- Financial Planning Standards Council: Certified Financial Planner
Jon Gjerde worked as a journalist in northern California where he covered topics ranging from city, county and tribal governments to alternative transportation. He holds a Bachelor of Arts in English from University of California, Davis.