BrokerExamA broker can resign from a client, with one exception and several conditions. That is the position in RIBO’s guidance note “Resigning” as a Broker from a Single Client, posted August 24, 2021 and still on ribo.com: “with that exception noted,” RIBO’s regulations do not prohibit resignation where the relationship “has deteriorated beyond repair.” The note sets out the exception, the Code of Conduct duties that apply on the way out, and a set of practical steps RIBO calls “merely suggestions and the minimum practical steps.”
The pattern RIBO sees
RIBO says it receives the enquiry often, and that in many cases the facts follow one pattern: a client who has abused every staff member who tried to help, again and again, until nothing the brokerage does seems able to satisfy them. A broker in that position, RIBO says, still has to act in compliance with applicable laws and professional obligations.
The auto insurance exception
The note carves out automobile insurance. In RIBO’s words, “for auto insurance in Ontario, brokers are required by law to provide access to insurance for consumers,” so a client who insists on applying for auto insurance gets an application, and the broker sends it to an insurer, as the Compulsory Automobile Insurance Act requires. A broker who refuses, RIBO warns, may face complaint proceedings. The Act itself, at s. 2, is the rule that no owner or lessee may operate a motor vehicle on a highway, or permit it to be operated, unless it is insured under a contract of automobile insurance.
The Code duties on the way out
RIBO anchors the guidance to paragraph 13 of s. 14 of O. Reg. 991: “A member’s conduct towards other members, members of the public, insurers and the Corporation shall be characterized by courtesy and good faith.” From it RIBO draws three requirements. A broker should refuse to continue serving a client only where there is a good-faith reason for ending the relationship. The broker must give the client adequate notice, so the client’s interests are not prejudiced. And the broker must use best efforts to see that the client’s needs are looked after despite the withdrawal, which RIBO says can in some circumstances be met by finding another broker for the client, or at least referring the client to brokers who can serve them.
RIBO qualifies its own list twice. Following the steps “does not automatically mean that a broker’s conduct meets the standards set out in the Code of Conduct,” and if a consumer complains, “each case will be reviewed based on the facts and circumstances of that case.”
The steps RIBO suggests
RIBO’s eight steps come down to documentation, a management decision, and a paper trail of notice. The file should record dates and times. The decision to resign should be management’s, with full support, and staff should be told it is final. RIBO suggests thinking in terms of six months’ notice, and names the biggest exposure as being accused of leaving the client without a broker on too little notice. The resignation itself goes by registered letter, effective at the expiry of the policies, naming policy numbers and expiry dates, in plain and polite language that avoids anything inflammatory. Service continues at full quality until expiry. A second registered letter goes out 45 days before expiry with a copy of the first, and a third one week before renewal confirming the brokerage has placed no coverage.
For candidates
RIBO cites one provision, paragraph 13 of s. 14 of O. Reg. 991, a regulation RIBO links from its Level 1 exam page. A second paragraph of the same section is the natural reading of RIBO’s step of continuing full service until the policy expires: paragraph 3, conscientious, diligent and efficient service. That link is this site’s, not RIBO’s. The auto exception brings in the Compulsory Automobile Insurance Act from the automobile section.