Regulatory Statement

Purpose 

This Regulatory Statement (“Statement”) establishes the Superintendent of Mortgage Services’ (“Superintendent”) insurance requirements for mortgage brokerages licenced under the Mortgage Services Act (“MSA”). This Statement comes into effect on October 13, 2026.

Background Information 

Under section 62(1) of the MSA Rules, a mortgage brokerage must maintain the errors and omissions insurance (“E&O insurance”) that is required by the Superintendent with extended coverage for loss resulting from fraudulent acts. Minimum coverage amounts for E&O insurance are set out in section 62(2) of the Rules.

Requirements 

As a requirement of being a licensed mortgage brokerage, a brokerage must maintain E&O insurance with extended coverage for loss resulting from fraudulent acts that is sufficient to pay a minimum of:

• $500,000 in respect of any single occurrence involving the mortgage brokerage or any related principal broker or mortgage broker, and 
• $1,000,000 in respect of all occurrences during a 365-day period involving the mortgage brokerage or any related principal broker or mortgage broker.  

In addition to the above, the Superintendent requires that the duration of the extended reporting period (also known as “tail coverage”) of the brokerage’s E&O insurance be for 3 years. More specifically, E&O insurance coverage must be maintained during the period the mortgage brokerage holds a licence in B.C. and for a period of 3 years following the event of either:

• the merger or winding up of the mortgage brokerage, or  
• the cancellation or suspension of the mortgage brokerage licence. 

The E&O insurance held by a mortgage brokerage must provide coverage for the category or categories of mortgage services that it is licensed to provide (i.e., dealing, trading, administering, and/or lending).

In line with the Mortgage Broker Regulators’ Council of Canada’s September 2025 notice, brokerages operating in multiple jurisdictions must ensure that they maintain sufficient E&O insurance to meet the minimum coverage required in each province in which it is licensed to conduct business. Specifically:

• Claims in one province must not erode the minimum coverage in another province. 
• Each licensed mortgage brokerage must have its own coverage and must not share coverage with another licensed brokerage, even if the brokerages are related or affiliated. 

As per section 62(3) of the Rules, a mortgage brokerage must immediately notify the Superintendent in any of the following circumstances:

• The E&O insurance is cancelled or not renewed; 
• The coverage provided by the E&O insurance falls below the minimum amount required; or 
• The mortgage brokerage makes a claim under the E&O insurance policy.  

These notifications can be completed via BCFSA’s IRIS web portal. 

Insurance Requirements for Brokerage Applications (New and Renewal) 

When submitting a mortgage brokerage application for a new licence or a renewal, applicants must submit:

1. The name of the licensed brokerage that is insured under the E&O insurance;   
2. The name of the insurance provider;  
3. Amount of insurance coverage;  
4. A declaration that the brokerage has adequate E&O insurance; and, 
5. Annual renewal date of the E&O insurance.  

Application Requirements for Insurance Amendments  

E&O insurance amendments must be submitted to the Superintendent within 30 days of any changes. These amendments include, but are not limited to:

1. The name of the licensed brokerage that is insured under the E&O insurance;  
2. The name of the insurance provider;  
3. Amount of insurance coverage; and/or 
4. Annual renewal date of the E&O insurance. 

Additional Information   

For inquiries related to errors and omissions insurance, please email msa@bcfsa.ca. 

Legislation 

MSA Rules s. 62

Copies of the legislation are available from www.bclaws.gov.bc.ca