Watch their feet, not their mouth – and see the hypocrisy



Morris Adams is ninety-one years old and a living example of a senior’s worst nightmare, “out living his money.” Morris’s problem is the tip of a financial iceberg faced by so many Canadian seniors.

Morris is still working doing tax returns for clients and looking after his wife of sixty-seven years, Ruth, who suffers from dementia. Morris takes care of her at home with the help of in-home-care, but the cost of the care has brought him to the brink of outliving his money. He has gone through $200,000 in savings (about $35,000 a year for home care) and all he has left is $500,000 in term life insurance.

Morris, like many seniors, is insurance rich but cash poor because his policies have no cash surrender value with the insurance companies. So a few months ago he came up with an idea.

He said, “At ninety-one, I don’t have much time left and when I die Ruthie will get the half-million, but we need the money now, at least some of it.” So he talked to his insurance company and proposed that they give him half the value of the insurance now and he’d surrender the policy so they’d end up paying only half the death benefit. But the insurer wouldn’t do it, not unless they had a doctor’s certificate stating Morris’s life expectancy. Of course, he was reasonably healthy at the time so his doctor couldn’t make such a statement.

Hypocrisy in action

Across Canada, there are tens-of-thousands, probably hundreds-of-thousands, of stories like Morris’s, seniors struggling financially while owning a valuable asset, their life insurance policy, but not able to sell it for fair market value. Because under six of ten provincial governments there are regulations that prevent seniors from accessing the fair market value for their policy through a life insurance settlement, a practice that is accepted in jurisdictions around the world. Exacerbating seniors’ dilemma is the fact that organizations that claim they are advocating for seniors (e.g., CARP, Advocis) are doing nothing to look into and advance the potential for Canadian seniors to access the true value in their life insurance. Their inaction is the height of hypocrisy in action.

CanadianSeniors I have been advocating for seniors on the life settlement issue for five years: talking with, writing to, meeting with elected officials, government agencies, insurance companies, insurance agents, the media and advocacy groups who purport to put seniors’ best interests first. I’ve also written a book about it, Why Are Canadian Seniors Worth More Dead Than Alive? What Canadian life insurers do not want you to know about life settlements and the hidden value in your policy.

What I have discovered is that there’s a lot of talk and no action. A dumpster full of hypocrisy.

Let me cite just three examples.


Recently, CARP (Canadian Association for Retired People) announced the appointment of a new VP of Advocacy, Wanda Morris. In an interview (Dec. 2017), she said the CARP board had agreed on their advocacy priorities for 2018, as “the sweet spot between needs and where there is potential for legislative change.”

  1. Number one is pension protection.
  2. Number two is RIS (Retirement Income Security)
  3. Number three is long-term care.
  4. Number four is affordable housing.

What the CARP board does not acknowledge is the reality that life settlements are indeed a “sweet spot” that falls smack-dab in the middle of all four of their priorities, and that could greatly enhance each. For years the CARP board has ignored this most obvious fact. Why? I suggest it’s the money. Because CARP sells insurance products and makes money and insurers spend money advertising with CARP. So CARP has never inquired into the validity of life settlements (they need look no further than the United States) or questioned the insurance industry’s false claims against life settlements, they’ve simply ignored them, and in so doing, also ignored the best interests of their more than 300,000 members. I suggest that’s irresponsible. And hypocritical. Not to mention shameful.


Brokers and financial planners are on the frontlines when it comes to helping seniors and they have a fiduciary responsibility to present their clients with all possible financial alternatives when planning for old-age. But once again, we see the hypocrisy.

Despite the self-declaration of Advocis (association of agents and advisors) that “… members serve the financial interests of millions of Canadians and are committed to putting their client interests first,” the association is serving up talk without action. Advocis’s more than 12,000 members are forced to ignore–– under threat of licence termination––the potential value that life insurance settlements could provide to Canadians, which, obviously, is blatantly ignoring their clients’ best interests. I know this for a fact; I’ve experienced it. The pledge of “clients first” is actually a hedge – a false proclamation – that sounds good but falls short because they cannot make their clients fully aware of a life settlement alternative.

This brings me to the third example: the Ontario Government.


Nowhere is the maxim, “watch their feet, not their mouth” more apt then in government. Nowhere is there more talk and less action. It is so historically ingrained that public expectations are always low––and rightly so. However, if and when some government action takes place, hope springs eternal––well, at least for a short time. That’s what happened in the last few months with the Ontario Legislature. Promise and hope were rising (Morris Adams was very hopeful) and then … action died on the rotting legislative vine. And with it, hope for seniors was lost in political hypocrisy.

MPP Michael Colle introduces Bill 162 (L-R: Morris Adams, MPP Colle, Leonard H. Goodman)

MPP Michael Colle introduces Bill 162 (L-R: Morris Adams, MPP Colle, Leonard H. Goodman)

Bill 162, a Private Members Bill introduce by MPP Michael Colle, received second reading on Oct 19, 2017. This bill, if passed, would amend an egregious regulation in the Ontario Insurance Act that currently prevents Ontario seniors from accessing the value in their insurance policies through a life settlement. This was a long overdue action––it was last proposed eighteen years ago, in 2000. But alas, it appears that hypocrisy will once again win the day––and seniors will lose.

Michael Colle says the bill won’t pass and be proclaimed unless MPPs get behind it, and MPPs won’t get behind it if there isn’t a public uprising (i.e., many calls and emails to MPP offices), and that won’t happen because so-called advocacy groups––that’s you CARP and Advocis––are mute, ignorant and opposed to this most important issue. For no valid reason.

When it comes to the issue of life settlements, if you watch the feet, not the mouths of these so-called advocates, it becomes self-evident that self-interest is at the core of their “sweet spot,” which, in turn, generates more hypocrisy than action for Canadian seniors.

A cautionary tale for the Ontario Government about seniors


This is a cautionary tale regarding the socio-economic relationship between the Government of Ontario and its more than two million seniors. The recent Brexit debacle is an example of what can happen when governments ignore for too long the underlying rights and needs of a large segment of the electorate.


For more than twenty years, the governments of Ontario have overlooked a fundamental right of seniors, and recently, an “Expert Advisory Panel,” appointed by Charles Sousa, Minister of Finance, did not address this most important financial issue, thereby, perpetuating the problem. The Panel submitted a report that again did not take into account the significant financial benefits that could be available to seniors through life insurance settlements.  The report is titled:  Review of the Mandates of the Financial Services Commission of Ontario, Financial Services Tribunal, and the Deposit Insurance Corporation of Ontario.


Life insurance settlements are a significant part of financial sectors in countries around the world and the benefits of a well-regulated, secondary market for life settlements has been evident for decades. Today, life settlements are available to seniors in the US and other countries, and some Canadian provinces, but not in Ontario. It is truly unfortunate that this Panel chose not to even mention the issue. This is particularly important to seniors because the insurance industry, through the Canadian Life and Health Insurance Association (CLHIA), has lobbied for years to prevent seniors having access to the fair market value of their life insurance policy in a well-regulated secondary market. And the CLHIA continues this unfair practice, including supporting new preventive legislation in other provinces (e.g., Saskatchewan).


The Life Insurance Settlement Association of Canada, an advocacy group for seniors, is, needless to say, very disappointed in the report by the Panel, which was appointed in 2015. As part of the Panel’s review process, we made an in depth submission (June 2015), attended a meeting with the Panel (July 2015), and provided a detailed response to the Panels “Preliminary Report” (November 2015). We set out, in considerable detail, the problem, the solution and the benefits to seniors and the taxpayers. And still, the Panel ignored the issue.


Conspicuous by its absence

Nowhere in the Panel’s 92-page report was there a comment on life settlements, which should be an integral part of any review of Ontario’s financial sector. We have set out below the essence of the issue and problem and how life settlements could make a significant contribution to Ontario seniors’ financial well-being:

  • Over a million Canadian seniors are living in poverty and/or working beyond retirement age because they need to.
  • Over half of Canadian seniors own a life insurance policy.
  • In jurisdictions around the world, a life insurance policy is considered an asset and can be sold for fair market value in well-regulated secondary markets.
  • A life settlement allows a policy owner to receive, on average, more than four-times the value they would receive from the insurance company, including term insurance which receives no cash value from the insurer.
  • In the United States, seniors receive more than $7 million a day from life settlements in a well-regulated industry.
  • In 2000, the Harris Conservative government passed legislation to repeal Section 115 of the Ontario Insurance Act, which is the regulation that prevents life settlements. It was never enacted by the Financial Services Commission of Ontario (FSCO) whose mandate was reviewed by the Panel.
  •  The Panel ignored an issue that goes to the fundamental rights of seniors to have access to the fair market value of an asset that they own?


Good report but a serious omission

We submit that although the majority of the Report is well done, the absence of any responsible insight and recommendations regarding the role of life settlements in a “modernized” Ontario financial sector is a serious omission. There are many statements and opportunities in the report where the Panel could have, and should have, commented on life settlements.

Two key statements:

Let us begin with two statements:

  1. A statement by Sun Life supports our case that a life insurance policy is an asset to be considered like all other “fixed-income investments;” therefore, life insurance settlements should be part of any mandate that reviews the financial sector and the government agencies that oversee it. “A recent analysis by Wayne Miller and Sally Murdock of Sun Life Financial conclude that permanent life insurance, specifically participating whole life, is in fact and attractive alternative asset class when compared against fixed-income investments.”
  2. An overarching statement by the Panel that goes to the heart of the matter: Appendix E, page 84, 4a: The Panel states: “In the context of financial services, FSRA [Financial Services Regulatory Authority] should be directed to provide strong and effective consumer protection while fostering a strong, innovative, vibrant and competitive financial services sector.”

LISAC believes that the intent in this statement cannot be achieved in Ontario if there is no secondary market in which seniors can access the fair market value of their life insurance asset, and have the right to sell it in an open and well-regulated life settlement industry. Without this, consumers cannot have a “competitive financial services sector.” The fact that the Panel did not address this most important category of financial assets is a travesty.

Further comments on Report’s content:

  • Covering letter: The Panel mentions in its covering letter that they expect their recommendations to be “… supported broadly.”

We suggest that if Ontario seniors were to understand what has not been addressed relative to their financial well-being that broad support would diminish significantly among the more than two million Ontario seniors.

  • Page 1: The Panel references creating “… a modern, responsive and effective regulator.” They further state: “Our recommendations were prepared with both the present and the future in mind, and in light of industry and regulatory trends here and worldwide.”

The Panel need look no further than the Unites States to see how a “modern, responsive and effective regulator … and regulatory trends here and worldwide,” include a secondary market for life settlements. We ask: Did they thoroughly assess the life settlement industry in the United States, which has been operating as a well-regulated industry for more than two decades?

  • Page 11: The Panel states: “We believe our final 44 recommendations, detailed in the next section, would be beneficial for industry, consumers, investors and pension plan beneficiaries alike.”

How can the Panel make such a statement while ignoring the evidence that so clearly supports the value and benefits of life settlements?

  • Page 15: The Panel states: “It should be made clear that, in its role as regulator of financial services, FSRA should strike an appropriate balance between the protection of consumers and the needs of the financial services sectors.”

There is no “appropriate balance” for consumers if they cannot access the fair market value for an asset that they own. In fact, the balance is seriously skewed to the life insurance companies who oppose a well-regulated life settlement industry because it would place considerable funds in seniors’ bank accounts instead of the insurance companies’ accounts.

  • Page 17: The Panel states: “… enable it to protect consumers and pension plan beneficiaries, and thus maintain confidence in the financial services and pensions sectors.”

LISAC contends that “Protection of consumers … and confidence in the financial services” cannot be achieved if consumers do not have access to a secondary market where they can receive fair market value for the life insurance asset (an asset as acknowledged by Sun Life).

  • Page 18, Recommendation 7: “FSRA’s mandate should be informed by the OECD’s G20 High-Level Principles. We kept these principles in mind as we developed the recommendations throughout this report.”

LISAC suggests that one of the principles the Panel cites is not applied, in part, in the report. “Competitive markets and products, innovation and service quality … the focus on consumers and pension plan beneficiaries must be achieved while simultaneously fostering a strong, vibrant and competitive financial services sector and a strong and sustainable pension system.”

This principle, as it applies in many other jurisdictions, includes life settlements as part of a “strong, vibrant and competitive financial services sector.” Why shouldn’t Ontario’s market economy have the same benefits.

  • Page 19, Recommendation 8: “FSRA should be required to develop, seek public comment…. In order to bolster and maintain confidence among consumers, investors and pension plan beneficiaries …. FSRA should seek public input regarding its priorities and regulatory approach.” “Without a voice of the consumer, there is no reasonable expectation that the consumer’s needs will be identified…” – McBride Bond Christian LLP

LISAC, advocating on behalf of the consumer, specifically seniors, made full representations to the Panel (two written submissions and attendance at a “roundtable”), but we can only conclude that our voice about seniors’ financial needs and the need for Ontario to establish open, fair and well-regulated markets was either: i) not heard or ii) ignored. Why?

Throughout the report the authors inserted and highlighted numerous supportive comments from participating organization; however, failed to include any non-supportive, comments such as the constructive information and insights submitted by LISAC.


Honourable Mitzie Hunter, Minister of Education , Government of Ontario

Honourable Mitzie Hunter, Minister of Education , Government of Ontario

Now, with CPP adjustments made by the federal government and there no longer being a need for Ontario to focus on developing pension plans, the Honourable Mitzie Hunter has moved from being Associate Minister of Finance to Minister of Education. But we suggest the focus on seniors’ financial retirement needs still requires special ministerial responsibility. The Government of Ontario needs the same focus and resources Ms. Hunter brought to pensions to now be directed to investigating and assessing the value and benefits that can be derived by establishing a well-regulated secondary market for life insurance settlements. In the end, this is for the benefit of Ontario seniors and the Ontario economy.


The big question:

How long, and how many “expert panels” are required, before common sense and pragmatism prevail and the Government of Ontario recognizes that Ontario seniors deserve what millions of seniors in other jurisdiction have, a well-regulated, life settlement industry?


shutterstock-230062642It should not take another fifteen years to fulfill the intention of the Harris Government in 2000, and if it does, we would point to the Brexit phenomenon as a cautionary tale for the Government of Ontario. Of Ontario’s more than two million seniors, 75% will vote in the next election.





Submitted on behalf of:

Leonard H. Goodman

Founder and Chair

June 29, 2016