Restricted Insurance Agency Licence

The BC government has enacted legislation to implement restricted licensing for the incidental sale of insurance for some businesses.  

Once published, provincial regulations will bring into force changes to the Financial Institutions Act made in 2019, requiring some businesses to have a restricted insurance agency licence to conduct incidental sales of insurance. 

The government has tasked the Insurance Council of BC with creating a framework for overseeing and issuing this new restricted insurance agency licence.

On this page:
The new restricted insurance agency licence explained.

What is a Restricted Insurance Agency Licence? 

The new restricted licence regime will require some businesses who sell insurance products incidental to their primary business to obtain a restricted insurance agency licence from the Insurance Council. 

In BC, the sale of insurance as a primary business requires both the agency and individuals selling insurance to be licensed. By contrast, for incidental sales of insurance, a restricted insurance agency licence would be issued to a business for the purpose of selling specific types of insurance through its employees or contractors, who would not need to hold their own individual licences.

Licensing model for primary insurance sales (shown on left)  vs. licensing model for incidental sales of insurance.

The framework for this licence will include licensing criteria, skills indicators, regulatory compliance mechanisms and other elements of professional regulation, which we are currently developing.

Do other jurisdictions in Canada have a restricted insurance agency licence? 

Currently four other jurisdictions in Canada have their own restricted insurance agency licence: Alberta, Saskatchewan, Manitoba and most recently New Brunswick. The Insurance Council has been consulting with these jurisdictions during the development of BC’s version of this regime. 

Who will this impact? 

In a 2022 government consultation paper, a variety of businesses and products were considered for inclusion in the new regulatory regime; it is not yet known which of these will be included in the regime. When the regulation is published, it will outline the list of businesses and products requiring a Restricted Insurance Agency licence to sell incidental insurance. 

See the Province's public consultation page for restricted insurance agent licences

When will this regulatory regime come into effect? 

The drafting of regulations for this regulatory regime is in progress. We expect it will take roughly a year after the publication of the regulations to develop and put in place a licensing framework, enabling licences to be issued. More information about timelines for the implementation of this regime will be made available when the regulations become public. 

About the licence framework

In preparation for the new regulatory regime, the Insurance Council has been working on developing a draft framework for the restricted insurance agency licence.  The framework will define core elements of the restricted licence: 

  • Licence qualifications. The experience, training, and other criteria necessary to get a licence and sell insurance. 

  • Ongoing licence requirements. Requirements of the licence, such as providing disclosures of information to the client or the regulator, annual declarations, licence fees, or requirements for continuing education. 

  • A designated representative. The role and responsibilities of an individual assigned to ensure the business complies with the requirements of its restricted licence. 

To ensure the effectiveness of proposed regulatory measures, the Insurance Council’s evaluation of the above topics will be informed by consultation with the businesses included in the Province’s regulations on incidental sales.

More about the licence framework

What to expect

Once the regulations are published outlining which business and products will be subject to the new regulatory regime, the following is anticipated:

  • Some businesses that were previously exempt from requiring a licence to conduct incidental sales of insurance will now need to become licensed under the restricted insurance agency licence.

  • Businesses that currently hold insurance licences restricted to the sale of specific products will be able to choose to continue to conduct their business under the new restricted insurance agency licence, if those products are included in the regulation.

  • If travel insurance is included in the regulation, the current Insurance Council-issued restricted travel licence will need to be aligned with the new restricted insurance agency licence framework.

Current status

To date, we’ve made progress on identifying criteria for the elements of the framework; however, further development will require engagement and consultation with the business sectors that will be directly impacted by regulation. This will be a critical next step in the development of the licence 

Next steps

Once further direction is provided by government through the publication of regulations identifying which types of businesses and products will be subject to the regulatory regime for incidental sales of insurance, the Insurance Council will:

  1. Publish components of the draft licence framework for public and industry consultation 

  2.  Engage in stakeholder outreach to gather input to inform the framework and planned processes for issuing licences

  3. Update the draft licence framework based on consultation feedback. 

The Insurance Council will then determine if additional consultation and revisions are warranted or if a finalized licence framework, set out in the Insurance Council Rules, can be submitted to the Minister of Finance for approval. 

A finalized version of the framework will be submitted to the Minister of Finance, and if approved would then lead to implementation, enabling the issuing of licences. We expect this to take roughly one year.

Process for development of licence frameworkDevelopment process for licence framework

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