The nominee is responsible for all insurance activities of the agency or firm as per Council Rule 7(6). This includes making sure all insurance activities of the agency or firm are appropriately supervised; there are sufficient procedures to facilitate compliance with Council requirements; and the public’s interest is properly served. This includes ensuring:
- Agency staff are appropriately licensed, as required.
- Corporate errors and omissions insurance is maintained.
- Notifications are provided to Council within five business days when a licensee ceases to represent an agency, the agency is disciplined by another regulator or other notifications, as required.
- Level 1 general insurance salespersons abide by their licence restrictions and do not sign insurance binders or conduct insurance activities outside the office.
- Sufficient supervision is in place at all branches of the agency.
- Adequate steps are taken to ensure clients are immediately notified about a lack of insurance coverage.
A licensed level 3 general insurance agent must actively supervise all the insurance activities of every general insurance salesperson and agent authorized to represent the agency.
As each agency differs in size, nature of the business conducted, and experience of licensees, nominees must determine the appropriate level of supervision. Council holds nominees accountable for their decisions and may require them to clearly demonstrate the appropriateness of the supervision provided.
To determine the appropriate amount of supervision, consider:
- How many level 3 and level 2 agents are in the office.
- How many level 1 salespersons are operating from the office.
- The experience and qualifications of the licensees.
- The nature of the business conducted.
- The hours of operation.
Council acknowledges the demands and challenges nominees can face and that it may not always be possible to foresee or prevent non-compliant insurance activities. However, as nominees are ultimately responsible for the insurance activities of the agency or firm, if Council becomes aware of activity that is contrary to the Financial Institutions Act, it will be up to the nominee to demonstrate that sufficient procedures and oversight were, and are, in place.