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Regulations governing the demutualization of federal property and casualty mutual insurance companies in Canada came into force on July 1, 2015 as . On January 14, 2016, the Office of the Superintendent of Financial Institutions (“OSFI”) released a Guide for property and casualty mutual insurance companies that have both mutual and non-mutual policyholders, which describes the relevant regulatory requirements for demutualization and sets out the information that must be provided to OSFI at each phase of the demutualization process. Click here to view the Guide.

Ontario credit unions and caisses populaires will be prohibited from directly or indirectly promoting non-authorized insurance products such as home, auto, health and life insurance, on their websites as of January 1, 2016, pursuant to legislative amendments recently introduced by the Government of Ontario. The amendments to Ontario Regulation 237/09, also known as the General Regulation under the Credit Unions and Caisses Populaires Act, 1994, S.O. 1994, c. 11, will restrict the promotion of non-authorized types of insurance on-line, which Ontario credit unions and caisses populaires are already prevented from doing in-branch. The Regulation currently prevents credit unions and caisses populaires from selling and promoting insurance in their branches unless the insurance is of an authorized type, such as creditor, mortgage or travel insurance.

This announcement from the Ontario Government echoes the history of the amendments to the federal Bank Act, S.C. 1991, c. 46, which only prohibited in-branch promotion of non-authorized insurance products by deposit-taking financial institutions in Canada until 2012, when amendments to the Bank Act came into force that extended the prohibition generally to the banks’ websites as well. The Ontario government have reasoned that this amendment will bring Ontario’s credit unions and caisses populaires under a consumer protection framework that is consistent with that of federally-regulated institutions.

The Financial Services Commission of Ontario announced the amendments in a Bulletin dated October 2, 2015, which links the full text of the amendments. The amendments will come into force on January 1, 2016, on which date the websites of Ontario credit unions and caisses populaires are required to be compliant with the new prohibition.

The 2015 publication of Getting the Deal Through, is now available, and includes our updated summary guide to the regulation of insurance and reinsurance in Canada.   Click here for access to a pdf version of the Canadian chapter.

We also have a limited number of hard copies of this publication, which are available on request.

Reproduced with permission from Law Business Research Ltd. This article was first published in Getting the Deal Through: Insurance & Reinsurance 2015, (published in June 2015; contributing editors: William D Torchiana, Mark F Rosenberg and Marion Leydier, Sullivan & Cromwell LLP). For further information please visit www.gettingthedealthrough.com.

The Government of Saskatchewan has given its first reading to Bill 177: The Insurance Act. The new legislation will replace The Saskatchewan Insurance Act, which has not been revised substantially in several decades. Bill 177 aims to modernize the regulation of the insurance industry in the Province of Saskatchewan, improve consumer protection measures and increase harmonization with the insurance legislation of the other western provinces. The full text of Bill 177 can be viewed here.

The following excerpt from a Government of Saskatchewan press release provides more detail concerning the proposed legislation:

““A lot has changed in the industry since revisions were last made to the Act, especially when it comes to technology,” Justice Minister and Attorney General Gordon Wyant said.  “The new Act will give the insurance sector the flexibility it needs to evolve in a rapidly changing environment, strengthen consumer protection, and move toward harmonizing insurance legislation with Alberta and BC.”

Changes proposed in The Insurance Act include:

• Better protection for consumers through market conduct standards, which identify unfair practices;
• Streamlining the appeal process;
• Restructuring the Saskatchewan Insurance Councils and allowing them to conduct audits and investigations;
• Requiring insurance companies to recommend and screen those applying to be intermediaries as well as supervise them once approved;
• Updating licensing categories and requirements including licensing employees that sell insurance as insurer’s representatives, which requires the same level of training as insurance agents;
• Permitting insurance agents to adjust insurance claims to a prescribed amount; and
• Requiring insurers to point to specific clauses in a policy where there are limits on the amount payable.

Work to develop the new Act involved interprovincial comparisons and review of other provincial and national projects on insurance and financial services, but the model used in Alberta was deemed to best fit Saskatchewan’s needs.  Alberta’s legislation is similar to that in BC, meaning Saskatchewan will share similar insurance regulation with all provinces in the New West Partnership Trade Agreement.

A number of industry associations were consulted, including the Insurance Brokers Association of Saskatchewan and the Saskatchewan Insurance Councils and they have expressed their support for modernization of the Act.”

On January 1, 2015, certain amendments to Manitoba’s The Insurance Act came into force requiring incidental sellers of insurance to hold a restricted insurance agent’s license in Manitoba as of June 1, 2015. See Section 72 of the The Insurance Amendment Act  S.M. 2012, c. 29 (“Bill 27”) for full text of the amendments. These amendments in Bill 27 are the second instalment in a series of amendments that were proclaimed to come into force in three parts: on September 1, 2014, January 1, 2015 and March 1, 2015, and which bring Manitoba’s The Insurance Act closer in line with Alberta’s Insurance Act.

This second group of amendments implements a restricted insurance agent licensing regime similar to those in place in Alberta and Saskatchewan. In addition to the amendments to The Insurance Act, the Manitoba Insurance Agents and Adjusters Regulation was also amended to set out the particulars of the new licensing regime (see M.R. 215/2014 for the amendments to the regulation proclaimed in force on January 1, 2015). Under the new restricted agent licensing regime, incidental sellers of insurance are required to obtain a restricted insurance agent license from the Insurance Council of Manitoba. Incidental sellers of insurance that will require a restricted agent license include deposit-taking institutions, travel agencies, mortgage brokers and funeral directors and other specified entities that, in the course of selling certain goods or services to their customers or clients, offer certain classes of insurance that relate to those goods or services.

The Insurance Council of Manitoba has announced that it will begin accepting applications for restricted insurance agent licences on February 1, 2015, and has advised that applications must be received prior to April 30, 2015 to ensure they are issued prior to June 1, 2015. The Insurance Council of Manitoba issued a Notice in December 2014 with further information about the transition, which is available here.

In the issue of the Canada Gazette released today, the federal government published long-awaited draft regulations which will permit Canada’s federal property and casualty mutual insurance companies to demutualize.   The text of the draft regulations can be seen by clicking here.  Interested parties are invited to make representations concerning the proposed regulations within 30 days.

The Marcotte Trilogy

The 2014 publication of Getting the Deal Through, is now available, and includes our updated summary guide to the regulation of insurance and reinsurance in Canada.   Click here for access to a pdf version of the Canadian chapter.

NEW – This year we are also pleased to be able to provide iPad users with complimentary access to the entire 2014 edition of Getting the Deal Through – Insurance & Reinsurance.  This publication provides a comprehensive analysis of the key insurance and reinsurance issues in 23 countries (which includes the Canadian chapter written by Walker Sorensen LLP).   Instructions on how to gain access using your iPad are found here.  You will need an iPad and an iTunes account.  The Sponsor and Reference codes are as follows:

Sponsor:   INR2014

Reference:  20JUN14

We also have a limited number of hard copies of this publication, which are available on request.

Reproduced with permission from Law Business Research Ltd. This article was first published in Getting the Deal Through – Insurance & Reinsurance 2014, (published in June 2014; contributing editor: E Paul Kanefsky, Edwards WIldman Palmer LLP) For further information please visit www.GettingTheDealThrough.com.”