Member Insurance Program

IBAS has partnered with Sage Advisor Resources, a subsidiary of the Insurance Brokers Association of Alberta (IBAA), to offer brokerage members access to three specially tailored insurance products.

Errors & Omissions Insurance

Underwritten by Swiss Re and delivered exclusively through brokers associations (and their duly licensed partners) across Canada, this E&O product has become a longstanding staple of the brokerage industry — providing affordable and stable rates, as well as superior coverage options from a carrier and program administrator that know the business inside and out.

By choosing the IBAS Member Insurance Program, brokerages are also ensuring that sensitive information required for enrolling in E&O insurance — such as financial information — remains with a trusted, neutral third party.

More than 75% of IBAS members already take advantage of this offering. 

Directors & Officers Insurance

D&O coverage marketed through IBAS is available only to brokerages that also hold an E&O policy under the Member Insurance Program.

Premiums start at $1,200 for $1 million of indemnity coverage, with a separate $1 million dedicated limit for legal defence expenses. The maximum indemnity limit offered is $5 million and the expense limit maximum is set at $2 million.

Here are a few reasons why D&O coverage for brokerages is critical to consider:

• Personal wealth protection: Directors and officers can be held personally liable for claims and, therefore, risk their individual financial security. D&O insurance can protect the personal assets of directors and officers, their spouses, and estates. Often, company assets are closely tied to the personal wealth of management, making protection for claims brought against the entity extremely vital.
  
  
• Indemnification supplement: An organization’s bylaws may state that the company shall indemnify its directors and officers, but that does not guarantee the entity will have the resources to do so. Further, the entity may not legally be able to indemnify directors and officers even if the resources are available. When a company cannot indemnify its directors and officers, D&O insurance can step in instead.
  
  
• Balance sheet protection: Allegations against directors and officers can be costly, even when they are frivolous, unfounded, or lack merit. Complex claims, such as shareholder suits, anti-trust allegations, and merger objection claims can generate sky-high defence and settlement costs that could have a negative impact on the firm’s financial profile and viability to continue operating. A D&O policy can absorb these types of costs.
  
  
• Vast potential claimant pool: Directors and officers can be sued by shareholders, competitors, creditors, customers, and employees. Moreover, claimants can include federal and provincial agencies who can initiate investigations that have the potential to generate a host of issues ranging from large defence costs to unflattering publicity and negative effects on a company’s brand.
  
  
• Bankruptcy and insolvency protection: During an economic or industry down-cycle, there is potential for bankruptcy resulting in creditor suits and bankruptcy trustee claims against board members. Claimants can seek restitution at the expense of the individual director or officer. When a company is insolvent and can’t indemnify the board, a D&O insurance policy is the last line of defence for directors and officers.
  
  
• Talent acquisition: Securing D&O coverage helps attract talent for outside and/or new board members, as these individuals will know they are protected. With D&O insurance in place, the leadership team can focus on managing operations rather than managing disruptive and perhaps lengthy litigation.
  
  
• Affordability: D&O insurance is very affordable insurance when compared to the cost of defending litigation and paying settlement values, which can be expensive.

Cyber Insurance

Delivered in partnership with APRIL Canada and AXIS, this product is designed to protect brokerages from mounting cyber threats.

There are two limit options — $1 million and $2 million (aggregate and per incident, except where outlined below) — with the following coverages:

• Enterprise security event liability;
• Media liability;
• Privacy regulation;
• Crisis management expense;
• Fraud response expense;
• Public relations expense;
• Forensic and legal expense;
• Extortion/ransomware loss;
• Business interruption;
• Data recovery;
• PCI fines;
• Social engineering fraud ($100,000 and $200,000 limits only);
• Telecommunication expense ($100,000 and $200,000 limits only); and
• Reputational loss.

The cost of the policy is based on the brokerage's annual commission revenue and the limit option selected. The carrier will endorse the policy to add a bricking endorsement with a $100,000 limit for an additional premium of $100.

What is bricking? Cyber policies historically excluded coverage for damaged computer hardware. Bricking refers to a loss of use or functionality of hardware (such as servers) as a result of a hacking event. While malicious software may be removed, hardware may still be considered untrustworthy and require replacement. This coverage provides for the cost to replace such affected hardware.

Disclaimer

IBAS's Member Insurance Program is administered and delivered entirely by Sage Advisor Resources, which is licensed in the Province of Saskatchewan. IBAS generates revenue from this program through two distinct streams:

• Sage Advisor Resources shares a portion of all earned commissions with IBAS in the form of a marketing sponsorship; and
• Swiss Re makes an annual sponsorship contribution directly to IBAS based on a formula similar to contingent profit commission (E&O and D&O book of business only).

Get a Quote

Get a free, no-obligation quote by calling Sage Advisor Resources at 1-587-921-7695 or toll-free at 1-800-318-0197 ext. 100.