Key Requirements For British Columbia's New Restricted Insurance Agency Licensing Framework

As noted in our previous bulletin, on December 18, 2025, the Government of British Columbia introduced a new restricted licensing framework for businesses that sell insurance products incidental to their primary business activities, effective January 1, 2027.

On January 7, 2026, the Insurance Council of British Columbia ("Council") released an update outlining the qualification requirements and ongoing compliance obligations for obtaining and maintaining a Restricted Insurance Agency ("RIA") Licence.

Obtaining an RIA Licence: Qualification Requirements

Under the proposed licence program, businesses applying for an RIA Licence will be required to:

• Provide Business information including contact information, ownership details, corporate registration information, and disclosure of information that may affect the agency's suitability to hold an RIA Licence, such as bankruptcy history, regulatory discipline, or criminal convictions.
• Obtain Errors and Omissions insurance.
• Have at least one contract with an insurer that is authorized to conduct business in British Columbia.
• Appoint a Designated Representative who will oversee the agency's regulatory compliance and insurance activities and serve as the primary point of contact with the Council. The Designated Representative must be an officer, director, or partner of the agency (or the sole proprietor, where applicable) and will be required to complete a specialized course administered by the Council.

Training for Representatives

Businesses must ensure that representatives who sell insurance on their behalf complete an accredited training course specific to the insurance products being sold. While the training course may be offered by any provider, it must be accredited by the Council to ensure the course content aligns with the required knowledge and skills outlined in the specified Performance Requirements for the RIA Licence.

The Performance Requirements are designed to ensure a baseline level of competence for sales representatives interacting with consumers. These requirements are organized into three core competency areas:

1. Knowledge of Insurance: basic insurance concepts and terminology, as well as an understanding of insurance products and services.
2. Technical Abilities: skills related to product sales, processing and servicing, along with legal and regulatory requirements that apply to those activities.
3. Business Skills: professional conduct and ethics, errors and omissions, and information management and record keeping.

Maintaining an RIA Licence: Ongoing Requirements

To maintain an RIA Licence in good standing, businesses must renew their licence on an annual basis and pay the applicable fees (in an amount to be determined). Licence holders must also continue to meet all qualification requirements listed above and must notify the Council immediately if they no longer have a Designated Representative in place.

The Council has indicated that sales representatives may be required to complete some form of continuing education in the future. However, these requirements are still to be determined.

Disclosure Requirements

To promote consistent experience and support consumer protection, it is anticipated that representatives selling insurance on behalf of Restricted Insurance Agencies will be required to provide the following written disclosures to buyers:

• That the purchase of insurance is optional
• That there may be other sources of coverage available
• Whether the buyer has the ability to cancel the insurance contract
• The contact information of the insurer
• Disclosure of any commission exceeding 30% of the price paid for the insurance product
• That the buyer will receive a copy of the coverage information
• That the buyer contracts with the insurer, not the agency
• Where applicable, that the insurance amount is less than the value of the loan, or that the duration of the insurance is less than the duration of the loan

Key Takeaways and Next Steps

While the RIA Licence program is still under development, businesses that are likely to require a licence should begin preparing now. During this transitional period, businesses can start gathering the required corporate information, identify suitable Designated Representatives, secure appropriate Errors and Omissions insurance, and establish contractual relationships with authorized insurers.

Additional details regarding the application process and required documentation are expected to be published ahead of the November 2026 application launch. In the meantime, the Council will continue to engage with industry stakeholders, and the proposed licence program will proceed through public consultation and a legislative rule-making process before licences are issued.

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2025