The Saskatchewan government has set the stage for significant
changes to insurance regulation in the province with the enactment
of TheInsurance Act on May 14, 2015. When the
government proclaims The Insurance Act into force, it will
completely replace the current Saskatchewan Insurance Act,
a statute that was first introduced in 1913 and has remained
relatively unchanged over the past century.
The Saskatchewan government's main goal in enacting The
Insurance Act is to modernize the insurance industry,
strengthen consumer protection and harmonize the province's
insurance act with the insurance acts in place in Alberta and
British Columbia. The Insurance Act is accordingly closely
modeled on the provisions of Alberta's Insurance
Some of the highlights under the new act are as follows:
Insurers and insurance intermediaries will be required to
follow new market conduct standards. Along with a prohibition on
unfair practices such as misleading statements or tied selling
practices, insurance intermediaries will be prohibited from
directly or indirectly giving customers anything of value to induce
them to "transact insurance" with an insurer or managing
general agent, except as permitted by regulation.
Insurance agents can be licensed under two new categories:
"managing general agents" and "insurer's
representatives." Managing general agents will have the
authority to sponsor other intermediaries.
Insurers and insurance agents licensed as managing general
agents will have to take a greater role in recommending, screening
and supervising insurance intermediaries.
Insurers will have to include new prescribed information in
their policies, certificates and communications to policyholders.
For instance, insurers will have to notify their policyholders of
the applicable limitation period on receipt of a notice of
Persons other than life insurance companies will be prohibited
from trading in life policies (i.e., viatical settlements), except
as permitted by regulation.
The Insurance Councils of Saskatchewan will have new powers to
conduct audits and investigations.
The Superintendent of Insurance will be able to require
insurers to conduct an "insurance compliance self-evaluative
audit" to evaluate their compliance with the new legislation
and other industry standards.
Expected entry into force
Insurance companies and insurance intermediaries will have time
to ensure they are in full compliance with the new act – the
regulations for The Insurance Act are still being drafted
and the government will likely not proclaim the new act into force
until sometime in 2016. Even then, The Insurance Act
contains transition provisions to assist with the adoption of the
new regulatory regime. Importantly, any licenses issued under the
current Saskatchewan Insurance Act will continue under the
same terms and conditions until they are amended, cancelled or
renewed pursuant to The Insurance Act.
Once The Insurance Act comes into force, British Columbia,
Alberta, Saskatchewan and Manitoba (thanks to recent substantial
amendments to its own Insurance Act) will have largely
similar insurance acts, but they will not be identical. Insurers
and insurance intermediaries will have to be aware of these
differences and ensure they remain fully compliant with the
regulatory regime in each jurisdiction.
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