A non-active member firm registration is required for any business (sole proprietorship, partnership or corporation) that has been set up for at least one of the following reasons:
- to receive commission income for tax purposes
- is a partner in a corporate partnership
- is an underlying corporation in a cluster or management agreement arrangement
To qualify for a non-active member firm registration, the non-active member firm name must not be identified in any way to the public. Should the non-active member firm name appear on any signage, letterhead, business cards or any other form to the public, transacting general insurance, a full registration is required and the firm must comply with all the regulations of an active member and file a full member registration fee.
The majority of equity and voting interest in a partnership must be held by licensed general insurance intermediaries.
Non-active member firms must also have an attended mailing address in Ontario, regardless of principal place of business.
Registering A Non-Active Firm
To apply for a new non-active member firm registration, the following must be submitted:
- fully completed and signed Application for Business Registration – Non-Active
- verification of business identity:
- Sole proprietorship – copy of registration of trading name
- Partnership – copy of registration of partnership under the Partnership Registration Act
- Corporation – copy of Articles of Incorporation
- certificate of Professional Errors and Omissions Liability insurance of at least $3 million per claim, $6 million aggregate adding the non-active member firm to the policy under whom the individual is registered. The policy must be underwritten by insurers licensed in the Province of Ontario and must indicate they are subject to special RIBO endorsements. It is the Broker’s responsibility to ensure that the requisite insurance coverages are maintained and that renewal or continuation certificates are provided to RIBO each year.
- appropriate registration fee
Transferring Non-Active Firm
When an individual with a registered non-active firm changes employment from one brokerage to another, the non-active member firm registration must also be transferred to the new brokerage. To transfer the non-active member firm registration, the following must be submitted:
- fully completed and signed Non-Active Member Undertaking.
- certificate of Professional Errors and Omissions Liability insurance of at least $3 million per claim, $6 million aggregate adding the non-active member firm to the policy under whom the individual is registered. The policy must be underwritten by insurers licensed in the Province of Ontario and must indicate they are subject to special RIBO endorsements. It is the Broker’s responsibility to ensure that the requisite insurance coverages are maintained and that renewal or continuation certificates are provided to RIBO each year.