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Errors & Omissions (E&O) insurance is professional-liability coverage that protects a mortgage brokerage, broker, or agent against claims of negligence or mistakes in the advice and paperwork given to a client, and is a mandatory licensing requirement in every Canadian mortgage-brokering jurisdiction.
E&O insurance exists so a client isn't left absorbing the cost of a broker's genuine mistake — a missed disclosure, a miscalculated ratio, bad advice that closes a deal the client shouldn't have signed. It's separate from a brokerage's general business insurance, which covers things like property damage or general liability, not professional advice.
The specific minimum coverage amounts — per-claim and aggregate — are set out in each province's own licensing rules and regulations and change from time to time, so they should always be confirmed directly with the regulator or an insurance provider rather than assumed. What stays constant across provinces is the principle: no active mortgage brokerage licence without it.
Licensing condition everywhere: FSRA (Ontario), BCFSA, RECA, and AMF all require a licensed mortgage brokerage to maintain E&O coverage as a condition of holding its licence.
Amounts set by regulation, not convention: minimum per-claim and aggregate coverage levels are fixed in each province's own rules and are subject to change — confirm the current minimum with the regulator, don't rely on a rule of thumb.
What it doesn't cover: E&O responds to professional negligence claims, not fraud committed by the licensee or a brokerage's general commercial liability.
Who's responsible for it: the principal broker is typically the one accountable for confirming the brokerage's coverage stays continuously in force.
Definitions reflect Canadian federal and provincial rules as of the “Updated” date above. Not advice for any specific file.
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