The Insurance Group at Stikeman Elliott notes the following legislative and regulatory initiatives and appeal court cases, which are among the developments and cases most likely to have a significant impact on the Canadian insurance industry over the next year.
Bill C-37: 2006 Financial Institutions Legislation Review
based on the federal White Paper released on June 14, 2006
among other things, the bill proposes to reduce the down payment necessary for a conventional mortgage from 25% to 20%
the bill was introduced in Parliament and had its first reading on November 27, 2006, and received its second reading on December 7, 2006, at which time it was referred to the Finance Committee for third reading and debate
for updated information on the coming into force of the bill CLICK HERE
introduced in June 2005 to amend the Insurance Companies Act (Canada) to make it more consistent with the Canada Business Corporations Act with regard to corporate governance requirements
the first phase of implementation of the bill was proclaimed into force on April 27, 2006
the second phase of implementation of the bill was proclaimed into force on November 28, 2006
for full details of the scheduled implementation CLICK HERE
the AMF has proposed amendments to "The Regulation respecting Information to be Provided to Consumers"
these amendments are likely to come into force early in 2007
Amendments to the Insurance Act (Manitoba)
Bill 11 was introduced and had its first reading on November 30, 2006
the bill amends the Insurance Act (Manitoba) to make it more consistent with the insurance acts of other provinces by:
changing the corporate governance provisions applicable to insurance companies incorporated in Manitoba;
allowing the classes of insurance to be prescribed by regulation; and
expanding the provisions allowing beneficiaries to be designated under accident and sickness insurance policies.
for the full text of the proposed legislative amendments, as well as an explanatory note CLICK HERE
New OSFI Guideline on Reinsurance Agreements
on December 8, 2006, OSFI released for comment a draft guideline on Reinsurance Agreements (Guideline B-13)
the guideline seeks to address an issue OSFI noted during a recent canvass of reinsurance agreements, specifically that there was a disparity in the length of time between the initiation of a reinsurance agreement and formal execution of the agreement by the parties
comments on the draft guideline are due on January 19, 2007. For the full proposed guideline CLICK HERE
New AMF Guideline on Transferring a P&C Portfolio Between Brokers
the AMF will issue both a guideline for the industry and a communication to its employees regarding the transfer of a property & casualty portfolio from one market intermediary to another
both documents likely to be released early in 2007
The Supreme Court of Canada
on December 11th, the Supreme Court heard two cases in which the Insurance Bureau of Canada was granted intervener status: Lumbermens Mutual Casualty Company v. Herbison et al and Citadel General Assurance Company v. Vytlingam et al
both cases concern the extent to which coverage should be permitted under standard automobile insurance policies for losses which are arguably unconnected with the normal use or operation of a motor vehicle
judgment was reserved in both cases
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Under B.C.'s former and current Limitation Act, the limitation period for a Plaintiff's claim can be extended on the basis of a Defendant having acknowledged in writing some liability for the cause of action.
Automobile drivers, like fine wine, tend to get better with age. Older drivers can draw on a wealth of experience from their years on the road to assist them when faced by a variety of dangerous conditions.
The insurance industry will be interested in Ledcor Construction Ltd v. Northbridge Indemnity Insurance Co because of principles the Supreme Court of Canada applied to the "faulty workmanship" exclusion in a Builders' Risk policy.
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