The RIBO Code of Conduct (a regulation/by-law under RIBA) is the broker's professional conduct rulebook. Five themes dominate the testable material.
- Best interests of the client / fair treatment: brokers must place the client's interests above their own commercial interests, give competent advice, and disclose limitations (e.g., a panel of insurers that does not include the lowest-cost market).
- Disclosure of compensation: brokers must disclose the nature and basis of any compensation arrangement that could influence advice (commission, contingent profit, fee). This is the FSRA/RIBO "fair treatment of customers" expectation.
- Conflicts of interest: brokers must avoid, manage, or disclose conflicts. Ownership in an insurer, family relationships with insurer staff, undisclosed referral fees: all require management.
- Trust funds (fiduciary accounts): premiums collected from clients and refunds due to clients are trust money. Brokers must hold them in a separate fiduciary trust account, never commingled with the brokerage's operating funds. RIBO inspects compliance.
- Continuing education (CE): registered brokers must complete continuing-education hours each cycle to remain in good standing; unlicensed activity (acting as a broker while not registered) and failing to supervise unregistered staff are disciplinable offences.
Beyond conduct, brokers must maintain errors & omissions (E&O) insurance at a minimum limit prescribed by RIBO, hold their brokerage under a registered firm structure, and follow complaint-handling procedures (acknowledge promptly, investigate, document, and disclose escalation paths to FSRA or the General Insurance OmbudService).
Common mistake: depositing a client's premium cheque into the brokerage's operating account, planning to "move it later". Even a short commingling is a Code breach. The funds are trust money from the moment they are received.
⚠️ Trap: Disclosure of compensation is not a one-time event. Any material change (new contingent arrangement, ownership change at an affiliated insurer) requires fresh disclosure to affected clients.
Recall: Where must premium funds collected from a client be held, and why? Name three conduct themes the RIBO Code of Conduct enforces beyond trust accounting.