New insurance license requirements for selling motor vehicle products
- AIC updates
These new licensing requirements apply to auto dealerships, equipment dealers, and all other businesses that sell motor vehicle warranty products, dealership loyalty programs, and ancillary motor vehicle protection products (e.g. key fob replacement coverage, glass protection products, non-manufacturer tire and rim warranties, etc.).
New license requirements for automobile dealerships and equipment dealers
AIC has issued IB-2024-01: New Alberta Insurance Council (AIC) Restricted Business License insurance type – Motor vehicle warranty contract, dealership loyalty programs, and vehicle protection products, which contains important information about a new restricted business license required to sell motor vehicle dealership loyalty programs and vehicle protection products. The Information Bulletin also outlines the licensing requirements for selling certain motor vehicle warranty products that are now considered insurance products.
Under the Superintendent of Insurance’s recently-issued Interpretation Bulletin 05-2024: Motor vehicle warranty contracts, dealership loyalty programs and vehicle protection products, motor vehicle dealership loyalty programs, ancillary motor vehicle protection products, and certain motor vehicle warranty products are considered insurance products and must be underwritten by licensed insurance companies and sold by licensed agents and/or businesses with restricted license types.
Auto dealerships and equipment dealers wanting to sell motor vehicle dealership loyalty programs and/or ancillary motor vehicle protection products will be required to both:
- Have those products underwritten by licensed insurers; and
- Apply for and hold a new “dealership loyalty programs and vehicle protection products” type of Restricted Certificate of Authority with AIC that authorizes the sale of those products.
As well, auto dealerships and equipment dealers selling certain motor vehicle warranty products will need to ensure those contracts are unwritten by licensed insurers and apply for and hold an “equipment warranty insurance” type of Restricted Certificate of Authority with AIC.
You are strongly encouraged to read both AIC’s Information Bulletin and the related Superintendent of Insurance Interpretation Bulletin to get the full details about the new license requirements and what products are subject as insurance under the Insurance Act. A reminder that all insurance products must be underwritten by a licensed insurance company and sold through a licensed insurance agent.
Read AIC's IB-2024-01 Information Bulletin
Read the Superintendent of Insurance's Interpretation Bulletin
Please also share these resources with your professional networks and colleagues to ensure they are aware of the new requirements and take the steps to get their products underwritten and obtain the necessary restricted business license(s).
Applications for the new type of restricted business license required to sell dealership loyalty programs and vehicle protection products will be available on the AIC website in January 2025.
Thank you for your attention in reading these important bulletins and becoming informed about the new licensing requirements for auto dealerships and equipment dealers.
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