Part 8
Transitional Provisions, Consequential Amendments, Repeals and Coming into
Force
                        Subpart 1
Transitional Provisions
           827      Definitions
           828      Continuation
of licensed special Act companies
           829      Continuation
of unlicensed special Act companies
           830      Certificate
of continuance
           831      Effect
of certificate of continuance
           832      Effect
of continuation
           833      Application
of Part 2, Subpart 2, Division 2
           834      Bylaws
           835      Shares
with nominal or par value
           836      Paid‑up
capital
           837      Deemed
consent - significant interest
           838      Voting
by participating policyholder
           839      Appointment
of directors and officers continued
           840      Directors’ remuneration
           841      Participating
policies
           842      Bylaws
           843      Deemed
bylaws
           844      Auditor
           845      Actuary
           846      Triennial
solicitation of policyholders
           847      Continuation
of licences and certificates
           848      Application
of section 501
           849      Regulations
                        Subpart 2
Consequential Amendments
  850-870      Consequential
amendments
                        Subpart 3
Repeals
           871      Repeal
of Acts
           872      Repeal
of Acts on Proclamation
           873      Repeal
of section
                        Subpart 4
Coming into Force
           874      Coming
into force
HER MAJESTY, by and with
the advice and consent of the Legislative Assembly of Alberta, enacts as
follows:
Interpretation
Definitions
1 In this Act,
                                (a)   “adjuster�
has the meaning set out in section 2;
                                (b)   “affiliate�
has the meaning set out in section 3;
                                (c)   “agency
contract� means a contract between an insurance agent and an insurer in which
the insurance agent agrees to act as an insurance agent in respect of insurance
issued by the insurer, but does not include the arrangement that an insurance
agent has with an insurer that is the service carrier for the Government
approved industry plan under section 661;
                                (d)   “automobile�
includes a trolley bus and a self‑propelled vehicle, and the trailers,
accessories and equipment of automobiles, but does not include watercraft,
aircraft or railway rolling stock that runs on rails;
                                (e)   “base
capital� means base capital as defined in the regulations;
                                 (f)   “beneficial
ownership� has the meaning set out in section 4;
                                (g)   “body
corporate� means any body corporate with or without share capital, wherever or however formed;
                                (h)   “certificate
of authority� means an insurance agent’s certificate of authority or an
adjuster’s certificate of authority;
                                 (i)   “chief
agency� means,
                                          (i)   in respect of a provincial company, the head office of the
company, and
                                         (ii)   in respect of an insurer that is not a provincial company, the
main office of the company in Alberta;
                              (i.1)   repealed
2002 cA‑4.5 s45;
                                 (j)   “contract
of insurance� includes any policy, certificate, interim receipt, renewal
receipt or writing evidencing the contract, whether sealed or not, and a
binding oral agreement;
                                (k)   “control�
has the meaning set out in section 5;
                                 (l)   “Court�
means the Court of Queen’s Bench;
                               (m)   “debt
obligation� means a bond, debenture, note or other evidence of indebtedness
whether secured or unsecured;
                                (n)   “deposit‑taking
institution� means
                                          (i)   Alberta Treasury Branches or a bank, credit union, loan
corporation or trust corporation, or
                                         (ii)   a member institution of the Canada Deposit Insurance Corporation
or of any other deposit insurance or guarantee plan prescribed under section
1(1)(l) of the Loan and Trust
Corporations Act;
                                (o)   “director�
means an individual occupying the position of director of a body corporate
regardless of the name given to the position, and “directors� refers to the
directors of a body corporate as a body;
                                (p)   “electronic
media� means electronic media as defined in the regulations;
                                (q)   “entity�
means a body corporate, an unincorporated body, the Crown in right of Canada or
in right of a province or territory, an agency of the Crown, a foreign
government and any agency of a foreign government, but does not include an
individual;
                                 (r)   “examiner�
means an examiner appointed under section 793;
                                (s)   “extra‑provincial
company� means an insurer that is incorporated in a province or territory other
than Alberta and that is authorized by that province or territory to carry on
the business of insurance in that province or territory;
                             (s.1)   “extra‑provincial
Crown insurer� means an insurer that
                                          (i)   is formed by or under the laws of another province or territory,
                                         (ii)   has an exclusive right to perform an insurance activity in that
province or territory, and
                                        (iii)   is beneficially owned or controlled by Her Majesty in right of
that province or territory;
                                 (t)   “federally
authorized company� means an insurer that is a company, society or foreign
company as defined in the Insurance
Companies Act (Canada) approved by order under that Act to carry on
business or to insure risks in Canada;
                                (u)   “financial
institution� means
                                          (i)   a bank,
                                         (ii)   Alberta Treasury Branches,
                                        (iii)   a loan corporation or trust corporation incorporated by or under
an Act of Canada, a province or a territory,
                                        (iv)   a credit union incorporated by or under an Act of Canada, a
province or a territory,
                                         (v)   a federally authorized company, an extra‑provincial company
or a licensed provincial company, and
                                        (vi)   any other prescribed entity;
                                (v)   “fraternal
society� means a body corporate that is a not for profit society, order or
association formed for the purpose of making, with its members only, contracts
of life, accident or sickness insurance in accordance with its constitution,
bylaws and rules and this Act;
                               (w)   “head
office�, in respect of an insurer, means the place where the chief executive
officer of the insurer transacts business;
                                (x)   “holding
body corporate� has the meaning set out in section 6;
                                (y)   “incorporator�,
in respect of a provincial company, means a person who applies for the
incorporation of the company;
                                (z)   “instrument
of incorporation� means the certificate, special Act, charter, letters patent
or other document incorporating, amalgamating or continuing a body corporate,
and includes all amendments to it;
                              (aa)   “insurance�
means the undertaking by one person to indemnify another person against loss or
liability for loss in respect of certain risk or peril to which the object of
the insurance might be exposed or to pay a sum of money or other thing of value
on the happening of a certain event and, without limiting the generality of the
foregoing, includes life insurance;
                             (bb)   “insurance
agent� means a person who, for compensation,
                                          (i)   solicits insurance on behalf of an insurer, insured or potential
insured,
                                         (ii)   transmits an application for insurance from an insured or
potential insured to an insurer,
                                        (iii)   transmits a policy of insurance from an insurer to an insured,
                                        (iv)   negotiates or offers to negotiate insurance on behalf of an
insurer, insured or potential insured or the continuance or renewal of
insurance on behalf of an insurer or insured, or
                                         (v)   enrolls individuals in prescribed contracts of group insurance,
                                         but does not include an
insurer;
                              (cc)   “insurance
agent’s certificate of authority� includes a restricted insurance agent’s
certificate of authority;
                             (dd)   “insurance
council� means an insurance council referred to in section 493;
                              (ee)   “insurance
money� includes all insurance money, benefits, surplus, profits, dividends,
bonuses and annuities payable by an insurer under a contract of insurance;
                               (ff)   “insurer�
means any person that undertakes or effects, or agrees or offers for valuable
consideration to undertake or effect, a contract of insurance, including the
underwriters or syndicates of underwriters operating on the plan known as
Lloyd’s, but does not include a person who exchanges with other persons
reciprocal contracts of indemnity or inter‑insurance as part of a
reciprocal insurance exchange;
                             (gg)   “licence�
means a licence under this Act unless the provision in which the term is used
specifies otherwise;
                             (hh)   “licensed
provincial company� means a provincial company that holds a valid and
subsisting licence or that holds an unexpired licence that has been suspended;
                                (ii)   “life
company� means an insurer that is permitted to insure
                                          (i)   only those risks falling within the class of life insurance, or
                                         (ii)   only those risks falling within the class of life insurance and
accident and sickness insurance or another class of insurance specified in the
regulations under section 35(2);
                                (jj)   “market
conduct activities� means activities that are carried out in the course of or
for the purpose of the marketing, sale or distribution to the public of, or the
performance of, any contract of insurance or service that an insurer offers to
the public;
                              (kk)   “Minister�
means the Minister determined under section 16 of the Government Organization Act as the Minister responsible for this
Act;
                                (ll)   “motor
vehicle liability policy� means a policy or part of a policy evidencing a
contract insuring
                                          (i)   the owner or driver of an automobile, or
                                         (ii)   a person who is not the owner or driver of an automobile where
the automobile is being used or operated by the person’s employee or agent or
any other individual on the person’s behalf,
                                         against liability arising
out of bodily injury to or the death of an individual or loss or damage to
property caused by an automobile or the use or operation of an automobile;
                            (mm)   “mutual
provincial company� means a provincial company that does not have common shares
and that is formed for the purpose of issuing participating policies;
                             (nn)   “non‑owner’s
policy� means a motor vehicle liability policy insuring a person solely in
respect of the use or operation by the person or on the person’s behalf of an
automobile that the person does not own;
                             (oo)   “officer�
means
                                          (i)   in relation to a body corporate, a chief executive officer,
president, vice‑president, secretary, controller, treasurer and any other
individual designated as an officer of the body corporate by bylaw or by
resolution of the directors of the body corporate, and
                                         (ii)   in relation to any other entity, any individual designated as an
officer of the entity by bylaw, by resolution of the members of the entity or
otherwise;
                             (pp)   “owner’s
policy� means a motor vehicle liability policy insuring a person in respect of
the ownership, use or operation of an automobile owned by the person and within
the description or definition of automobile in the policy and, if the contract
so provides, in respect of the use or operation of any other automobile;
                             (qq)   “participating
policy� means a policy issued by an insurer that entitles its holder to
participate in the profits of the insurer;
                               (rr)   “participating
policyholder� means the holder of a participating policy;
                              (ss)   “person�
means an individual, entity or personal representative;
                               (tt)   “personal
representative� means an executor, administrator, guardian, committee, trustee,
assignee, receiver or liquidator;
                             (uu)   “policy�
means an instrument evidencing a contract of insurance;
                             (vv)   “premium�
means the single or periodical payment to be made for insurance, and includes
dues, assessments and other consideration;
                            (ww)   “premium
note� means an instrument given as consideration for insurance by which the
maker of the instrument undertakes to pay the sum or sums that may be legally
demanded by the insurer, the aggregate of those sums not to exceed an amount
specified in the instrument;
                               (xx)   “professional
advisor� means
                                          (i)   an auditor,
                                         (ii)   an actuary,
                                        (iii)   a lawyer, accountant, appraiser, architect or engineer, or
                                        (iv)   any other person whose membership in a profession would tend to
lend credibility to a statement made or opinion given by that person,
                                         and includes an individual
who is a member of or who works in a professional capacity for a partnership,
body corporate or other association of persons that is a professional advisor;
                             (yy)   “property�
that is the subject of a contract of insurance includes
                                          (i)   profits, earnings and other pecuniary interests, and
                                         (ii)   expenditure for rents, interest, taxes and other expenses and
charges and expenditures in respect of inability to occupy the insured
premises, but only to the extent provided for in the contract;
                               (zz)   “property
and casualty company� means an insurer that is not a life company;
                            (aaa)   “provincial
company� means an insurer incorporated under this Act;
                           (bbb)   “provincial
life company� means a provincial company that is a life company;
                            (ccc)   “provincial
property and casualty company� means a provincial company that is a property
and casualty company;
                           (ddd)   “proxy�
means a completed and executed form of proxy by means of which a participating
policyholder or shareholder appoints a proxyholder to attend and act on behalf
of the participating policyholder or shareholder at a meeting of participating
policyholders or shareholders;
                            (eee)   “proxyholder�
means the person appointed by proxy to attend and act on behalf of a
participating policyholder or shareholder at a meeting of participating
policyholders or shareholders;
                              (fff)   “reciprocal
insurance exchange� means a group of subscribers exchanging reciprocal
contracts of indemnity or inter‑insurance with each other through a
principal attorney as defined in section 78(b);
                           (ggg)   “relative�,
when used with respect to individuals, means related by blood, marriage or
adoption or by virtue of an adult interdependent relationship;
                           (hhh)   “reporting
issuer� means a reporting issuer within the meaning of that term in the Securities Act;
                               (iii)   “security�
means
                                          (i)   in relation to a body corporate, a share of any class of shares
of the body corporate or a debt obligation of the body corporate, and includes
a warrant of the body corporate, but does not include a deposit with a deposit‑taking
institution or any instrument evidencing such a deposit, and
                                         (ii)   in relation to any other entity, any ownership interest in or
debt obligation of the entity,
                                         but does not include a
policy;
                               (jjj)   “security
interest� means an interest in or charge on property by way of mortgage, lien,
pledge or otherwise taken by a creditor or guarantor to secure the payment or
performance of an obligation;
                            (kkk)   “significant
interest� has the meaning set out in section 8;
                               (lll)   “special
broker� means a person who, for compensation, negotiates or offers to negotiate
insurance, or the continuance or renewal of insurance, with unlicensed insurers
in respect of any matter or thing in Alberta;
                         (mmm)   “special
resolution� means a resolution passed by a majority of not less than 2/3 of the
votes cast by the participating policyholders or shareholders who voted in
respect of that resolution or signed by all the participating policyholders or
shareholders entitled to vote on that resolution;
                      (mmm.1)   “spouse�
means the husband or wife of a married person but does not, for the purposes of
sections 256, 314 and 434, include a spouse who is living separate and apart
from the person if the person and spouse have separated pursuant to a written
separation agreement or if their support obligations and family property have
been dealt with by a court order;
                           (nnn)   “subsidiary�
has the meaning set out in section 9;
                           (ooo)   “subsisting�
means, in respect of a licence or certificate of authority, that the licence or
certificate has not expired and has not been cancelled;
                           (ppp)   “substantial
investment� has the meaning set out in section 10;
                           (qqq)   “Superintendent�
means the Superintendent of Insurance appointed under this Act;
                              (rrr)   “total
assets� means total assets as defined in the regulations;
                            (sss)   “unincorporated
body� means a trust, partnership, fund or other unincorporated association or
organization;
                              (ttt)   “valid�
means, in respect of a licence or certificate of authority, that the licence or
certificate is not under suspension and has not been cancelled;
                           (uuu)   “voting share� means a share of any class of
shares of a body corporate carrying voting rights under all circumstances or by
reason of an event that has occurred and is continuing or by reason of a
condition that has been fulfilled.
RSA 2000 cI‑3
s1;2002 cA‑4.5 s45;2005 c27 s2
Adjuster
2(1) For the purposes of this Act, “adjuster� means
a person who, for compensation,
                                (a)   directly
or indirectly solicits the right to negotiate the settlement of a loss under a
contract of insurance on behalf of an insured or insurer or a reciprocal
insurance exchange, or
                                (b)   negotiates
the settlement of a loss under a contract of insurance on behalf of an insured
or insurer or a reciprocal insurance exchange.
(2) For
the purposes of this Act, an adjuster does not include
                                (a)   a
lawyer when practising law,
                                (b)   a
trustee of property or an agent of an owner of or person having an insurable
interest in property who negotiates a settlement of a loss under a contract of
insurance in respect of the property,
                                (c)   an
insurer, or
                                (d)   an employee of an insured who negotiates the
settlement of a loss under a contract of insurance on behalf of the insured.
1999 cI‑5.1 s2
Affiliate
3(1) An entity is affiliated with another entity if
one of them is controlled by the other or both of them are controlled by the
same person.
(2) The affiliates of an entity are deemed to be
affiliated with all other entities with which the entity is affiliated.
1999 cI‑5.1 s3
Beneficial ownership
4(1) A security or other interest is beneficially
owned by a person when it is held
                                (a)   directly
by that person, or
                                (b)   through
a personal representative or other intermediary
for the use or benefit
of that person otherwise than as a security interest.
(2) A
person is deemed to own beneficially securities that are beneficially owned by
an entity controlled by that person.
(3) If a person owns securities in a corporation
that itself owns securities in a body corporate, in determining the person’s
beneficial ownership of securities in the body corporate for the purposes of
subsection (2) no regard is to be taken of the securities of the body corporate
that are owned by the corporation.
1999 cI‑5.1 s4
Control
5(1) A person controls a body corporate if the
person holds or beneficially owns securities of the body corporate to which are
attached more than 50% of the votes that may be cast to elect directors of the
body corporate and the votes attached to those securities are sufficient, if
exercised, to elect a majority of the directors of the body corporate.
(2) A
person controls an unincorporated body if the person holds or beneficially owns
more than 50% of the beneficial interest, however designated, into which the
body is divided and the person is able to direct the affairs of the entity.
(3) Despite
subsections (1) and (2), a person controls an entity if the person has, in
relation to the entity, any direct or indirect influence that, if exercised,
would result in control in fact of the entity.
(4) A
holding body corporate is deemed to control any entity that is controlled or
deemed to be controlled by a subsidiary of the holding body corporate.
(5) An entity that controls another entity is
deemed to control any entity that is controlled or deemed to be controlled by
the other entity.
1999 cI‑5.1 s5
Holding body corporate
6 A body corporate is the
holding body corporate of a body corporate that is its subsidiary.
1999 cI‑5.1 s6
Ordinarily resident in
Canada
7 An individual is ordinarily resident in
Canada if the individual is
                                (a)   a Canadian citizen ordinarily resident in
Canada,
                                (b)   a
Canadian citizen who does not live in Canada but is a member of a prescribed
class of individuals, or
                                (c)   a permanent resident within the meaning of
the Immigration Act (Canada) and
ordinarily resident in Canada, except a permanent resident who has been
ordinarily resident in Canada for more than one year after the time at which
the individual first became eligible to apply for Canadian citizenship.
1999 cI‑5.1 s7
Significant interest
8 A person has a significant interest in a
class of shares of a body corporate where the aggregate of
                                (a)   any
shares of that class beneficially owned by the person, and
                                (b)   any
shares of that class beneficially owned by entities controlled by the person
exceeds 10% of all of the outstanding shares of that class
of shares of the body corporate.
1999 cI‑5.1 s8
Subsidiary
9 A body corporate is a subsidiary of
another body corporate if
                                (a)   it
is controlled by
                                          (i)   that other,
                                         (ii)   that other and one or more bodies corporate each of which is
controlled by that other, or
                                        (iii)   2 or more bodies corporate each of which is controlled by that
other,
                                    or
                                (b)   it is a subsidiary of a body corporate that
is that other’s subsidiary.
1999 cI‑5.1 s9
Substantial investment
10(1) A person has a substantial investment in a body
corporate when
                                (a)   the
voting rights attached to the aggregate of any voting shares of the body
corporate beneficially owned by the person exceed 10% of the voting rights
attached to all of the outstanding voting shares of the body corporate, or
                                (b)   the
aggregate of any shares of the body corporate beneficially owned by the person
represents ownership of more than 25% of the shareholders’ equity of the body
corporate.
(2) A person has a substantial investment in an
unincorporated body where the person beneficially owns more than 25% of all the
ownership interests, however designated, into which the body is divided.
1999 cI‑5.1 s10
Incorporated
11(1) When this Act or the regulations refer to a
body corporate in relation to the jurisdiction in which it was incorporated or
to the legislation under which it was incorporated, “incorporated� includes
amalgamated and continued.
(2) This section does not apply to Divisions 1 and
2 of Part 2, Subpart 2.
1999 cI‑5.1 s11
Contracts made in
Alberta
12(1) A contract of insurance is deemed to have been
made in Alberta if
                                (a)   it
insures a person who is domiciled or resident in Alberta when the contract is
made, or
                                (b)   the
subject‑matter of the contract is property that is or will be located in
Alberta.
(2) Subsection
(1) does not apply to a contract of life insurance to which Part 5, Subpart 4
applies.
(3) This section has effect despite any agreement,
condition or stipulation to the contrary.
1999 cI‑5.1 s12
Application
Mutual benefit societies
13(1) In this section, “mutual benefit society� means
a body corporate formed for the purpose of providing sick, disability or
funeral benefits for its members.
(2) This
Act does not apply to a mutual benefit society if,
                                (a)   in
the case of sick or disability benefits, the society provides benefits of $12
or less per week, and
                                (b)   in the case of funeral benefits, the society
provides benefits of $400 or less in respect of one funeral.
1999 cI‑5.1 s13
Benefits provided under
authority of federal Act
14 This Act does not apply to
                                (a)   a
body corporate that has, by or under the authority of an Act of the Parliament
of Canada, created a fund for paying a gratuity on the event of death,
sickness, infirmity, casualty, accident or disability or on any change of
physical or mental condition, or
                                (b)   a body corporate that has, by or under the authority
of an Act of the Parliament of Canada, an insurance and provident society or
association or an insurance or guarantee fund in connection with the body
corporate.
1999 cI‑5.1 s14
Benefit plans for
medical care, accident and sickness benefits
15(1) This
Act, except section 626.1, does not apply to a prescribed entity to the extent
of its provision to participants of prescribed benefits relating to medical
care, accident and sickness benefits.
(2) For the purposes of this section and section
15.1, “participant� includes a beneficiary or dependant of a participant.
RSA 2000 cI‑3 s15;2003 c19 s30;2005 c27 s3
Employee benefit schemes
for income replacement
15.1(1) In
this section, “non‑accountable entitiesâ€? means entities that are not
accountable organizations within the meaning of section 16 of the Government
Accountability Act.
(2) Subject to any regulations made
under subsection (3), this Act does not apply to an entity to the extent of its
provision to its participants of prescribed benefits whose subject‑matter
is income replacement due to disability, sickness or disease, provided that no
death benefit is payable.
(3) The Lieutenant Governor in Council
may make regulations
                                (a)   applying
this Act to prescribed classes of non‑accountable entities in respect of
their provision to their participants of benefits referred to in subsection
(2), and
                                (b)   respecting
such provision of those benefits by those classes, and in particular, in
relation to each such class,
                                          (i)   the nature and sufficiency of its financial resources as a source
of continuing financial support for the financial obligations implicit in
providing the benefits,
                                         (ii)   the availability of financial statements, prepared comparably to
those referred to in section 219(1), to participants,
                                        (iii)   the degree of segregation of any assets relating to the provision
of the benefits, or offer of the benefits, to participants from the assets of
the entity,
                                        (iv)   the adequacy of any capital or reserves maintained by the entity
to support the provision or offer of the benefits, and
                                         (v)   the extent to which matters referred to in this subsection are to
be disclosed to participants, and the timing of any such disclosure.
(4) Notwithstanding subsection
(3)(b)(v), where a non‑accountable entity provides benefits referred to
in subsection (2) that are not underwritten by an insurer, it shall disclose to
its participants, prior to or at the time that the benefits are offered, that
the benefits are not underwritten by an insurer and that the benefits would be payable
from the net income, retained earnings or other financial resources.
2003 c19 s30;2005 c27 s4
Regulations
16 The Lieutenant Governor in Council may
make regulations
                                (a)   defining
base capital, electronic media and total assets for the purposes of this Act;
                                (b)   respecting
any matter that is to be prescribed under sections 1 to 15.1;
                                (c)   establishing
the classes and subclasses of insurance for the purposes of this Act;
                                (d)   exempting
from the application of this Act
                                          (i)   a specific contract of insurance,
                                         (ii)   any type of contract of insurance that indemnifies a person who
has an interest in a product against the product’s malfunction, failure or
breakdown, or
                                        (iii)   contracts of insurance issued by a specified person or class of
persons who operate on a non‑profit basis;
                                (e)   respecting the terms and conditions that
must be met to maintain an exemption under clause (d).
RSA 2000 cI‑3 s16;2003 c19 s31
Crown Immunity
Crown immunity
16.1(1) In
this section,
                                (a)   “Crown�
means the Crown in right of Alberta and includes a Minister of the Crown and
agents and employees of the Crown;
                                (b)   “reform
amendments� means the amendments made to this Act by the Insurance Amendment
Act, 2003 (No. 2) and the Insurance Amendment Act, 2005, and any
regulations, orders in council, ministerial orders or board orders made
pursuant to or by virtue of those amendments.
(2) No liability attaches to the Crown
for any loss or damages that have arisen or may arise in respect of the reform
amendments.
(3) All
existing and future causes of action in law or in equity against the Crown in
respect of the reform amendments, including, without limitation, Alberta Court
of Queen’s Bench action number 0403‑14323 and the claims made in that
action, are extinguished without costs.
(4) Nothing
in this section acknowledges, admits, validates or recognizes a cause of action
referred to in subsection (3).
2005 c27 s5
Part 1
Licensing of Insurers and Reciprocal Insurance Exchanges
Subpart 1
Licensing of Insurers
Insurer’s Duty to be Licensed
Undertaking insurance
and carrying on business
17(1) An insurer undertaking a contract of insurance
that is made in Alberta, whether the contract is original or renewed, except
the renewal from time to time of life insurance policies, is, for the purposes
of this Act, undertaking insurance in Alberta.
(2) An
insurer is, for the purposes of this Act, carrying on business in Alberta if
the insurer
                                (a)   undertakes
or offers to undertake insurance in Alberta,
                                (b)   sets
up or causes to be set up in Alberta any sign or inscription that contains the
name of the insurer or that refers to insurance,
                                (c)   carries
on market conduct activities in Alberta,
                                (d)   solicits
or negotiates insurance in Alberta orally or in writing or by electronic media
or any other medium of communication or by vending machines,
                                (e)   issues
or delivers any policy of insurance or interim receipt in Alberta,
                                 (f)   collects
or receives or negotiates for or causes to be collected or received or
negotiated for any premium for a contract of insurance in Alberta,
                                (g)   inspects
any risk in Alberta,
                                (h)   adjusts
any loss under a contract of insurance in Alberta,
                                 (i)   prosecutes
or maintains in Alberta any action or proceeding in respect of a contract of
insurance, or
                                 (j)   is
listed in a telephone directory for any part of Alberta.
(3) Any body corporate or unincorporated body that
receives in Alberta contributions from its members out of which any gratuities
or benefits are paid directly or indirectly on the death of any of its members
is, for the purposes of this Act, an insurer carrying on business in Alberta.
1999 cI‑5.1 s17
Requirement for licence
18(1) Except as provided for in this Act, no insurer
may carry on business in Alberta unless the insurer holds a valid and
subsisting licence.
(2) Except
as provided for in this Act, no insurer may insure a risk in Alberta unless the
insurer holds a valid and subsisting licence for a class of insurance that
covers that risk.
(3) Except
as provided for in this Act, no person may enter into or renew a contract of
insurance to insure a risk in Alberta with an insurer unless
                                (a)   the
insurer holds a valid and subsisting licence, and
                                (b)   the licence held by the insurer authorizes
the insurer to undertake a class of insurance that covers the risk that is
insured.
1999 cI‑5.1 s18
Licensing Requirements
Types of insurers
19(1) Only the following insurers are eligible for a
licence under this Part:
                                (a)   a
provincial company;
                                (b)   an
extra‑provincial company;
                             (b.1)   an
extra‑provincial Crown insurer or an affiliate of an extra‑provincial
Crown insurer;
                                (c)   a
federally authorized company;
                                (d)   an
insurer made up of underwriters or syndicates of underwriters operating on the
plan known as Lloyd’s or any other plan approved by the Minister.
(2) Despite
subsection (1), a fraternal society is eligible for a licence under this Part
only if
                                (a)   the
fraternal society is a federally authorized company, or
                                (b)   the fraternal society is incorporated under
the laws of a province other than Alberta and has been continuously licensed in
Alberta as a fraternal society under this Act and the predecessor of this Act
from December 31, 1995.
RSA 2000 cI‑3
s19;2005 c27 s6
Application requirements
20(1) An application for a licence must
                                (a)   be
filed with the Minister,
                                (b)   specify
the classes of insurance that the applicant wishes to be authorized to
undertake, and
                                (c)   contain
the information, material and evidence required by the Minister.
(2) An
application for a licence must be accompanied with
                                (a)   a
plan for the conduct and development of the business of the company,
                                (b)   in
the case of an applicant other than a provincial company, a certified copy of
its instrument of incorporation and bylaws,
                                (c)   if
the applicant is a federally authorized company, a certified copy of the order
under the Insurance Companies Act
(Canada) approving the company to carry on business or to insure risks in
Canada,
                                (d)   if
the applicant is an extra‑provincial company, a certified copy of its
authority to carry on business from the jurisdiction in which the company is
incorporated and a certified copy of the latest audited financial statements of
the company,
                                (e)   copies
of all policy forms and forms of application for insurance proposed to be used
by the applicant in Alberta,
                                 (f)   the
appointment of an individual as its attorney for service and the consent of the
individual to act as the attorney for service, and
                                (g)   the
address of its chief agency in Alberta.
(3) After
filing an application for a licence, the applicant must provide to the Minister
any additional information, material and evidence the Minister considers
necessary.
(4) An
application by a provincial company for its first licence after its
incorporation under this Act must
                                (a)   set
out the sums of money paid or to be paid by the company in connection with its
incorporation and organization, and
                                (b)   contain evidence satisfactory to the
Minister that the directors have performed their duties under section 309.
1999 cI‑5.1 s20
Names
21(1) No insurer may be licensed with a name that
does not meet the requirements of section 211(1) and the regulations under
section 212.
(2) Subject
to this Act and the regulations, an insurer may be licensed with a name in an
English form, a French form, an English form and a French form or a combined
English and French form, and it may be legally designated in Alberta by any
such name.
(3) Where
an insurer has a name that contravenes subsection (1), the Minister may license
the insurer if it undertakes either to change its name to a name that does not
contravene subsection (1) or to carry on business in Alberta under a name that
does not contravene subsection (1).
(4) Where, through inadvertence or otherwise, an
insurer becomes licensed with a name that contravenes subsection (1), the
Minister may order as a condition of being licensed that the insurer carry on
business under a name specified in the order.
1999 cI‑5.1 s21
22 Repealed 2005 c27 s7.
First
licence of provincial company
23 Before issuing the first licence to a
provincial company, the Minister must be satisfied that
                                (a)   the
meeting of shareholders referred to in section 133 has been held,
                                (b)   the
expenses of incorporation or organization that have been paid or are to be paid
by the company are reasonable,
                                (c)   the
management, directors or persons who hold a significant interest in any class
of shares of the company are fit as to character, and
                                (d)   the management and directors have the
competence and experience suitable for involvement in the operation of a
financial institution.
1999 cI‑5.1 s23
Ability to carry on
class of insurance
24 Before issuing the first
licence to an insurer, the Minister must be satisfied that the insurer has the
capacity and power to carry on the classes of insurance that it has specified
in its application.
1999 cI‑5.1 s24
Base capital
25(1) Before
issuing a licence to or renewing a licence of a provincial or extra‑provincial
company, the Minister must be satisfied that
                                (a)   the
amount of the company’s base capital is at least,
                                          (i)   for life companies, $5 000 000 or any greater amount
specified by the regulations, and
                                         (ii)   for property and casualty companies, $3 000 000 or any
greater amount specified by the regulations,
                                    and
                                (b)   the
company’s base capital is adequate, taking into account the nature of the business
that it proposes to engage in, the expected volume of its business and any
restrictions on its business.
(2) If, at any time during a year, a
provincial or extra‑provincial company that is licensed ceases to have an
adequate base capital as required under subsection (1)(a), the company must
promptly
                                (a)   give
written notice of that fact to the Superintendent, and
                                (b)   cease
to undertake or to offer to undertake insurance in Alberta
until the Superintendent gives written notice to the
company that the Superintendent is satisfied that the company’s base capital
once again meets the requirements of subsection (1)(a).
RSA 2000 cI‑3
s25;2003 c40 s2
Compliance with market
conduct laws
26 The Minister may refuse to
issue a licence to or renew a licence of an insurer if the Minister is
satisfied that the insurer is not complying with the laws respecting market
conduct activities of other jurisdictions in which it is licensed.
1999 cI‑5.1 s26
Issuing licence
27 An insurer that applies for a licence
under this Subpart or to renew such a licence is entitled to the licence if the
Minister is satisfied that
                                (a)   the
requirements of this Act and the regulations relating to the licence have been
met, and
                                (b)   the insurer is in compliance with this Act
and the regulations.
1999 cI‑5.1 s27
Notice of licence
28(1) The Minister must publish a notice of the
licence of an insurer in The Alberta Gazette.
(2) This section does not apply to a renewal of a
licence.
1999 cI‑5.1 s28
Expiry
29 A licence expires on December
31 of the year in which it is issued or renewed.
1999 cI‑5.1 s29
Renewal of licence
30 An application for a renewal of a licence
must
                                (a)   be
filed with the Minister,
                                (b)   specify
the classes of insurance that the applicant wishes to be authorized to undertake,
and
                                (c)   contain the information, material and
evidence required by the Minister.
1999 cI‑5.1 s30
Duty on expiration of
licence
31(1) An insurer must not allow its licence to expire
unless
                                (a)   the
insurer gives the Minister 30 days’ notice of its intention not to renew its
licence, and
                                (b)   the
insurer provides the Minister with a statutory declaration stating that
                                          (i)   the insurer has no unpaid claims in respect of the insurer’s
contracts of insurance made in Alberta,
                                         (ii)   all of the insurer’s contracts of insurance made in Alberta are
discharged or expired or have been transferred or assigned to another licensed
insurer, and
                                        (iii)   the insurer has no outstanding fees or taxes payable to the
Government.
(2) When an insurer does not renew its licence, the
Minister must publish a notice in The Alberta Gazette stating that the licence
of the insurer has expired and setting out any information about the insurer or
its business in Alberta that the Minister considers appropriate.
1999 cI‑5.1 s31
Terms and conditions
32(1) The Minister may, when issuing or renewing a
licence, or at any time during the term of a licence, impose on the licence any
terms or conditions that are consistent with this Act that the Minister
considers appropriate.
(2) Before imposing terms or conditions under this
section, the Minister must notify the insurer of the proposed terms or
conditions and provide the insurer with an opportunity to make representations
to the Minister.
RSA 2000 cI‑3
s32;2005 c27 s8
Automobile insurance
33 An insurer’s licence to undertake
automobile insurance in Alberta is subject to the following conditions:
                                (a)   in
any action in Alberta against the licensed insurer or its insured arising out
of an automobile accident in Alberta, the insurer must appear and must not set
up any defence to a claim under a contract made outside Alberta, including any
defence as to the limit or limits of liability and prescribed accident benefits
under the contract, that could not be set up if the contract were evidenced by
a motor vehicle liability policy issued in Alberta;
                                (b)   in
any action in another province or territory against the licensed insurer or its
insured arising out of an automobile accident in that province or territory,
the insurer must appear and must not set up any defence to a claim under a
contract evidenced by a motor vehicle liability policy issued in Alberta,
including any defence as to the limit or limits of liability and prescribed
accident benefits under the contract, that could not be set up
                                          (i)   if the contract were evidenced by a motor vehicle liability
policy issued in the other province or territory, or
                                         (ii)   under a scheme of no fault insurance that
has been established by statute in the other province or territory.
1999 cI‑5.1 s33
Classes of Insurance
Classes of insurance
34(1) A licence issued by the Minister must set out
the classes of insurance that the licensee is authorized to undertake.
(2) If a question arises as to the class of
insurance into which any specific contract of insurance or form of policy
falls, the Minister may determine the question and that determination is final
for the purposes of this Act.
1999 cI‑5.1 s34
Restriction on classes
of insurance
35(1) Subject to subsection (2), no licence may be
issued that authorizes the licensee to undertake life insurance and any other
class of insurance.
(2) A
licence may be issued that authorizes the licensee to undertake life insurance
and
                                (a)   accident
and sickness insurance, or
                                (b)   any other prescribed class of insurance in
the prescribed circumstances.
1999 cI‑5.1 s35
Prohibited activities
36(1) Except as permitted under this Act and the
regulations, no licensed insurer may
                                (a)   carry
on business as an information management corporation as defined in the
regulations, except in relation to the main business of an insurer;
                                (b)   carry
on business as a financial leasing corporation as defined in the regulations;
                                (c)   accept
deposits;
                                (d)   carry
on the business of offering services to the public as or accepting or executing
the office of
                                          (i)   executor or administrator or trustee, or
                                         (ii)   guardian or trustee of a minor’s estate or of the estate of a
mentally incompetent person;
                                (e)   carry
on any other activity that is prescribed for the purposes of this subsection.
(2) Nothing in this section prevents a subsidiary
of a insurer from engaging in the activities described in subsection (1).
1999 cI‑5.1 s36
Scope of fire insurance
licence
37(1) An insurer licensed to undertake fire insurance
may, subject to its instrument of incorporation and any term or condition of
its licence, insure or reinsure any property in which the insured has an
insurable interest
                                (a)   against
loss or damage by fire, lightning or explosion,
                                (b)   against
loss or damage from falling aircraft, earthquake, windstorm, tornado, hail,
sprinkler leakage, riot, malicious damage, weather, water damage, smoke damage,
civil commotion and impact by vehicles, and
                                (c)   against
any one or more perils falling within any other prescribed classes of
insurance.
(2) An insurer licensed to undertake fire insurance
may, under a contract falling within Part 5, Subpart 3, insure an automobile
against loss or damage.
1999 cI‑5.1 s37
Life insurance
38 An insurer licensed to undertake life insurance
may, unless the licence expressly provides otherwise, include disability
insurance in any policy of life insurance in respect of the same life or lives
insured by the policy.
1999 cI‑5.1 s38
Attorney for Service
Attorney for service
39(1) Every insurer licensed under this Subpart must
have an attorney for service who meets the requirements of subsection (2).
(2) The
attorney for service must be an individual who is resident in Alberta.
(3) Service
of any document in a legal action, suit or proceeding on an insurer may be
effected by
                                (a)   delivering
the document to its attorney according to the Minister’s records,
                                (b)   delivering
the document to the address of its attorney according to the Minister’s
records, or
                                (c)   sending
the document by registered mail to that address.
(4) A
document sent by registered mail to the attorney’s address in accordance with
subsection (3)(c) is deemed to be served 7 days from the date of mailing unless
there are reasonable grounds for believing that the attorney did not receive
the document at that time or at all.
(5) Every licensed insurer must ensure that its
attorney’s office is open during normal business hours.
1999 cI‑5.1 s39
Attorney’s change of address
40 An attorney for service who
changes addresses must, before the change occurs, notify the Minister of the
date of the change and the new address.
1999 cI‑5.1 s40
Change in attorney
41(1) If the attorney for service of an insurer dies
or resigns or if an insurer revokes the appointment of its attorney for
service, the insurer must, as soon as is reasonably possible, provide the
Minister with
                                (a)   the
appointment of its new attorney for service, and
                                (b)   the
consent of the individual to act as the attorney for service.
(2) An
attorney for service of an insurer who intends to resign must
                                (a)   give
not less than 60 days’ notice to the insurer, and
                                (b)   send a copy of the notice to the Minister.
1999 cI‑5.1 s41
No attorney for service
42 If an insurer does not have an
attorney for service, service on the insurer may be effected by serving the
Superintendent.
1999 cI‑5.1 s42
Reporting Requirements
Annual financial
statements
43(1) Every insurer licensed under this Act must
within 180 days after the end of the insurer’s financial year provide the
Minister with a copy of the insurer’s audited financial statements for the
financial year.
(2) Every
licensed provincial company that has a subsidiary must within 180 days after
the end of the subsidiary’s financial year provide the Minister with a copy of
the subsidiary’s audited financial statements for the financial year.
(3) The
Minister may, by written notice, require the holding body corporate of a
licensed provincial company to provide the Minister with the holding body
corporate’s annual audited financial statements and the annual audited
financial statements in respect of any of the holding body corporate’s
subsidiaries.
(4) Every licensed insurer must provide, on written
request without charge, one copy of the insurer’s latest audited financial
statements to a person who is resident in Alberta and who is a policyholder.
1999 cI‑5.1 s43
Annual return
44(1) Every licensed provincial company must file an
annual return within the time period specified in subsection (2) that meets the
requirements of subsections (3) and (4).
(2) The
annual return must be filed
                                (a)   in
the case of a provincial company that is limited by the Minister to the
reinsurance of risks, within 105 days after the end of the financial year in
respect of which the return is prepared, or
                                (b)   in
the case of any other provincial company, within 60 days after the end of the
financial year in respect of which the return is prepared.
(3) The
annual return must
                                (a)   set
out the provincial company’s name and the address of its head office, the names
and residential addresses of its directors, the names of its officers and auditor, the name and address of its
attorney for service and, if the company’s records are held outside Alberta
under section 217(4), the address at which those records are located,
                                (b)   set
out the assets, liabilities, receipts and expenditures of the company for the
financial year and be audited in a manner that is satisfactory to the Minister,
                                (c)   set
out particulars of the business done in Alberta during the financial year,
                                (d)   be
accompanied with the actuary’s valuation referred to in section 405,
                                (e)   set
out any other information considered necessary by the Minister, and
                                 (f)   be
approved and signed by the president, vice‑president or managing director
or other director appointed for the purpose by the board of directors and by
the secretary or manager of the company.
(4) The assets of a provincial company must be
valued in accordance with the method established by the regulations under
section 432(f).
1999 cI‑5.1 s44
Change in officials
45 If the directors, officers or
auditor of a provincial company change, or if the residential addresses of the
directors change, the company must notify the Minister of the new names or
addresses within 15 days of the change.
1999 cI‑5.1 s45
Report on business
particulars
46(1) Every insurer, other than a provincial company,
licensed under this Act for all or part of a year (the “reporting year�) must
submit to the Minister before the last day of February of the year following
the reporting year a report that sets out the particulars of the insurer’s
insurance business written in Alberta during the reporting year.
(2) Instead of submitting the report referred to in
subsection (1) to the Minister, the Minister may allow an insurer to submit the
report to an official of a government in Canada who has an information sharing
agreement with the Minister.
1999 cI‑5.1 s46
Records of premium
income and losses - automobile insurance
47(1) Every licensed insurer that carries on in
Alberta the business of automobile insurance must prepare and file with the
Minister, or with a statistical agency that the Minister may designate, a
record of its automobile insurance premiums and of its loss and expense costs
in Alberta, in a manner and according to a system of classification that the
Minister approves.
(2) A
statistical agency designated by the Minister must compile the data in the
records filed under subsection (1) in a manner approved by the Minister and
submit the compiled data to the Minister.
(3) The
reasonable remuneration and expenses of the statistical agency designated by
the Minister are payable by the insurers whose data is compiled and, if there
is a dispute with respect to the amount payable, the Minister’s decision is
final.
(4) An amount determined by the Minister under
subsection (3) is a debt owing to the statistical agency by the insurer
specified by the Minister and may be recovered from the insurer by the agency
in an action for debt.
1999 cI‑5.1 s47
Audit of records
48(1) If at any time it appears to the Minister that
an insurer is not keeping records in a manner that shows correctly the
experience of the insurer in Alberta as required by section 46 or 47, the
Minister may hire an accountant
                                (a)   to
audit the books and records of the insurer, and
                                (b)   to
give instructions that will enable the officers of the insurer to comply with
those sections.
(2) The
reasonable remuneration and expenses of the accountant that are approved by the
Minister for an audit of an insurer under subsection (1) must be paid by the
insurer.
(3) If the amount approved under subsection (2) is
not paid by the insurer, the Minister may pay the amount and then recover it
from the insurer in an action for debt.
1999 cI‑5.1 s48
Other information -
licensed insurers
49 Every licensed insurer, other than a
provincial company, must provide the Minister with a copy of
                                (a)   any
change to its instrument of incorporation within 7 days of the change’s being
made, and
                                (b)   notice of its being subject to an
arrangement in a jurisdiction in which it is licensed other than Alberta that
is in the nature of a compliance undertaking, within 7 days of the
arrangement’s being made.
1999 cI‑5.1 s49
Additional information
50 A licensed insurer must provide to the
Minister, within the time specified by the Minister,
                                (a)   any
information that is required by the Minister to enable the Minister to respond
to inquiries on the company’s market conduct activities;
                                (b)   information for prescribed analytical or
policy‑making purposes.
1999 cI‑5.1 s50
Suspension, Cancellation
and Other Actions
Affecting Insurers’ Licences
Federally authorized
companies
51(1) In this section, “order� means an order under
the Insurance Companies Act (Canada)
that approves a federally authorized company to carry on business or to insure
risks in Canada.
(2) If
the order of a federally authorized company is rescinded, the licence of the
company under this Act is automatically cancelled.
(3) The
Minister must revive the licence of a federally authorized company that has
been cancelled under this section if the company obtains a new order before the
licence would have expired.
(4) If
the authority to insure a class of risks is deleted from the order of a
federally authorized company, that class of insurance is automatically deleted
from the licence of the company under this Act.
(5) The Minister must restore the class of
insurance to the licence of the federally authorized company referred to in
subsection (4) if the class of insurance is restored to the company’s order
before the licence has expired.
1999 cI‑5.1 s51
Extra-provincial
companies
52(1) If the licence of an extra‑provincial
company is cancelled or suspended with or without conditions under the laws of
the jurisdiction under which the company is incorporated, the Minister must,
                                (a)   if
the jurisdiction cancelled the licence, cancel the licence held by the company
under this Act, or
                                (b)   if
the jurisdiction suspended the licence, suspend the licence on the same
conditions.
(2) If
under the laws of the jurisdiction under which an extra‑provincial company
is incorporated terms, conditions or restrictions are imposed on its licence to
carry on business in that jurisdiction, the licence held by the company under
this Act is automatically subject to the same terms, conditions or restrictions
unless the Minister provides otherwise under subsection (3).
(3) If
the Minister suspends a licence under subsection (1) or if subsection (2)
applies, the Minister may make any modifications to the terms, conditions or
restrictions imposed under the laws of the other jurisdiction that the Minister
considers necessary to take into account circumstances in Alberta.
(4) If
under the laws of the jurisdiction under which an extra‑provincial
company is incorporated a class of insurance is deleted from its licence issued
in that jurisdiction, the class of insurance is automatically deleted from the
licence held by the company under this Act.
(5) The Minister may revive the licence of an extra‑provincial
company that has been cancelled under subsection (1), delete or vary terms or
conditions imposed on the licence of an extra‑provincial company under
subsection (2) or (3) or restore to the licence of an extra‑provincial
company a class of insurance that is deleted under subsection (4) if the
revival, deletion, variance or restoring occurs in the jurisdiction in which
the extra‑provincial company is incorporated.
1999 cI‑5.1 s52
Cancellation on request
53(1) The Minister may, on the request of a licensed
insurer, cancel the insurer’s licence.
(2) The
Minister must not cancel the licence of an insurer under subsection (1) unless
the Minister is satisfied that
                                (a)   the
insurer has no unpaid claims in respect of the insurer’s contracts of insurance
made in Alberta,
                                (b)   all
of the insurer’s contracts of insurance made in Alberta are discharged or
expired, or have been transferred or assigned to another licensed insurer, and
                                (c)   the
insurer has no outstanding fees or taxes payable to the Government.
(3) The Minister must publish a notice of the
cancellation of a licence under this section in The Alberta Gazette.
1999 cI‑5.1 s53
Sanctions affecting
licences
54(1) Where
                                (a)   a
licensed insurer or other person denies the Minister, the Superintendent or an
examiner access to any information, records, documents or property that the
Minister, Superintendent or examiner is authorized by this Act to have access
to,
                                (b)   the
holding body corporate of a licensed provincial company fails to forward to the
Minister audited financial statements in accordance with a notice under section
43(3),
                                (c)   a
licensed insurer or other person contravenes
                                          (i)   an order of the Minister,
                                         (ii)   a decision of a review board under section 806, or
                                        (iii)   an order of the Court under section 767 or 809,
                                (d)   a
licensed insurer is convicted of an offence under section 531(8) or 657,
                                (e)   grounds
exist for the possession and control of the assets of a provincial company by
the Minister,
                                 (f)   a
provincial company is carrying on or soliciting business in any jurisdiction
other than Alberta without first being authorized to do so under the laws of
that jurisdiction,
                                (g)   a
licensed insurer fails to comply with any term or condition to which its
licence is subject,
                                (h)   a
licensed insurer does not, for a period of 5 years or more, engage in the
business of insurance,
                                 (i)   a
licensed insurer fails to comply with the provisions of Part 4, or
                                 (j)   the
amount of a licensed extra‑provincial company’s base capital at any time
falls below the respective amount specified in or under section 25(a),
the Minister may
cancel, suspend or refuse to renew the licence of the insurer, or may impose
terms or conditions on its licence.
(2)
Where the Minister proposes to act under subsection (1), the Minister must give
notice of that intention to the licensed insurer.
(3) If,
in the Minister’s opinion, the public interest may be prejudiced or adversely
affected by any delay in acting under subsection (1), the Minister may, without
notice, cancel or suspend the licence of the insurer or impose terms or
conditions on its licence.
(4) The
Minister must forthwith give notice to the insurer of any action taken under
subsection (3).
(5) An
insurer that receives a notice under subsection (2) or (4) and who wishes to
have a hearing before the Minister must serve a written request for the hearing
on the Minister within 15 days after receipt of the notice.
(6) If
an insurer requests a hearing in accordance with subsection (5) in respect of
an action taken by the Minister under subsection (3), the Minister may, after
giving the insurer an opportunity to be heard, confirm the action taken or
modify or reverse the action taken.
(7) If
an insurer requests a hearing in accordance with subsection (5) in respect of
the Minister’s proposed action under subsection (1), the Minister may, after
giving the insurer an opportunity to be heard, take any of the proposed actions
set out in the notice with or without modifications or decide not to take any
of those actions.
(8) The Minister must publish in The Alberta
Gazette notice of every cancellation or suspension of a licence under this
section.
RSA 2000 cI‑3
s54;2003 c19 s32
Non‑payment of
claims
55(1) The Minister must cancel the licence of an
insurer if the Minister is satisfied that
                                (a)   a
judgment arising out of a contract of insurance made in Alberta has been issued
against the insurer, and
                                (b)   the
judgment has become final in the regular course of law, is enforceable in
Alberta and has remained unpaid for 30 or more days after becoming final.
(2) The Minister may revive a licence that has
been cancelled under subsection (1) if the judgment against the insurer is paid
within 6 months after the cancellation and the licence would not have expired.
1999 cI‑5.1 s55
Effect of cancellation
or suspension
56(1) When an insurer’s licence is cancelled under
this Subpart, the insurer may carry on business in Alberta only to the extent
that it is necessary for the winding‑up of its business in Alberta.
(2) When
an insurer’s licence is suspended under this Subpart, the insurer may carry on
business in Alberta only in accordance with the terms and conditions of the
suspension.
(3) When a class of insurance has been deleted from
an insurer’s licence under this Subpart, the insurer must cease to undertake or
to offer to undertake that class of insurance in Alberta.
1999 cI‑5.1 s56
Provisional liquidator
57(1) The Minister may appoint a provisional
liquidator to be in charge of the affairs of a provincial company if
                                (a)   the
company fails to renew its licence without complying with section 31,
                                (b)   the
company’s application to renew its licence is refused, or
                                (c)   the
company’s licence is cancelled in circumstances other than those set out in
section 53.
(2) Until
a permanent liquidator is appointed by the Court, the provisional liquidator
has all of the powers of the insurer, and none of the officers or directors of
the provincial company may enter into a contract or incur any liability on
behalf of the company without the approval of the provisional liquidator.
(3) A
provisional liquidator of a provincial company must apply to the Court under
section 190 for an order winding up the company.
(4) Despite subsection (3), a provisional
liquidator of a provincial company may, with the approval of the Court, sell
the business of the company as a going concern.
1999 cI‑5.1 s57
Remuneration of
provisional liquidator
58(1) The Minister is responsible for establishing
the remuneration of a provisional liquidator.
(2) The remuneration of a provisional liquidator of
a provincial company and the provisional liquidator’s costs and expenses while
acting as the provisional liquidator are payable by the company and are a first
lien or charge on the assets of the company.
1999 cI‑5.1 s58
Municipal Licensing Fees
Exemption from certain
fees
59 An insurer that holds a
licence under this Act is exempt from the payment of any licence fee for the
transaction of the business of insurance imposed by a municipality or Metis
settlement.
1999 cI‑5.1 s59
Regulations
Regulations
60 The Lieutenant Governor in Council may
make regulations
                                (a)   specifying
an amount of base capital for life or property and casualty companies for the
purposes of section 25(a);
                                (b)   respecting
any matter that is to be prescribed under this Subpart;
                                (c)   respecting the issuance of a licence to an
extra‑provincial Crown insurer or an affiliate of an extra‑provincial
Crown insurer including, without limitation, regulations suspending or
modifying the application or operation of any one or more provisions of this
Act in respect of the extra‑provincial Crown insurer or the affiliate, as
the case may be.
RSA 2000 cI‑3
s60;2005 c27 s9
Subpart 2
Exceptions
Unsolicited Insurance
Unsolicited insurance
61(1) Despite section 18, an insurer that is not
licensed may undertake insurance in Alberta with an insured if
                                (a)   the
insurance is effected without any solicitation whatsoever on the part of that
insurer, and
                                (b)   the
insured, not later than 30 days after signing the contract of insurance or
receiving any policy, interim receipt or insuring document issued by or on
behalf of the insurer, whichever occurs first,
                                          (i)   notifies the Superintendent in writing under oath of the terms of
the insurance, the insurer with whom the insurance is placed and the amount of
premium paid or payable or premium notes given or to be given in connection with
the insurance, and
                                         (ii)   at the same time pays to the Minister of Finance a fee equal to
50% of the premium paid or payable or premium notes given or to be given in
connection with the insurance.
(2) If
the fee referred to in subsection (1)(b)(ii) is not paid within 30 days from
the time it becomes payable, a sum equal to 50% of the fee remaining unpaid
becomes a penalty that forms a part of the fee and is recoverable with the fee.
(3) Despite
section 18, a person may enter into or renew a contract of insurance to insure
a risk in Alberta with an unlicensed insurer if the requirements of subsection
(1)(a) and (b) have been met.
(4) This section does not apply to a contract of
insurance that may be evidenced by a motor vehicle liability policy.
RSA 2000 cI‑3
s61;2005 c27 s19
Reinsurance
Reinsurance
62(1) In this section, “Alberta contract� means a
contract of insurance made in Alberta, but does not include a contract of
reinsurance.
(2) Despite
section 18, an insurer, other than a provincial company, that is not licensed
may enter into a contract as the insurer that reinsures risks in respect of an
Alberta contract if the insurance business in Alberta of the insurer is
restricted to the reinsurance of risks.
(3) Despite section 18, a licensed insurer that is
the insurer under an Alberta contract may, subject to the regulations, enter
into a contract of reinsurance in respect of the Alberta contract with an
insurer referred to in subsection (2).
1999 cI‑5.1 s62
Special Brokers
Insurance through
special broker
63(1) Despite section 18, an insurer that is not
licensed may undertake insurance in Alberta with an insured if
                                (a)   the
insurance cannot be obtained from licensed insurers,
                                (b)   the
insurance is effected through a person who holds a valid and subsisting special
broker’s licence for that class of insurance,
                                (c)   before
the insurance is undertaken the special broker obtains from the proposed
insured a signed and dated document
                                          (i)   describing the nature and amount of the insurance required, and
                                         (ii)   stating that the insurance cannot be obtained from licensed
insurers and specifying the licensed insurers who refused the proposed
insured’s application,
                                    and
                                (d)   before
the insurance is undertaken the special broker discloses in writing to the
proposed insured that the insurance will be placed with an unlicensed insurer.
(2) Despite
section 18, a person may enter into or renew a contract of insurance to insure
a risk in Alberta with an unlicensed insurer if the requirements of subsection
(1)(a) to (d) have been met.
(3) This section does not apply to a contract of
insurance that may be evidenced by a motor vehicle liability policy.
1999 cI‑5.1 s63
Certificate of authority
64 No person may be issued a
special broker’s licence for a class of insurance or have a special broker’s
licence renewed for a class of insurance unless the person holds an insurance
agent’s certificate of authority, other than a restricted insurance agent’s
certificate of authority, for that class of insurance.
1999 cI‑5.1 s64
Financial guarantee
65 No person may be issued a
special broker’s licence or have a special broker’s licence renewed unless the
person maintains a financial guarantee in a form satisfactory to the Minister
in the prescribed amount.
1999 cI‑5.1 s65
Application for special
broker’s licence
66(1) An application for a special broker’s licence
or to renew a special broker’s licence must
                                (a)   be
filed with the Minister,
                                (b)   specify
the classes of insurance in respect of which the applicant wishes to transact
business,
                                (c)   contain
the information, material and evidence required by the Minister, and
                                (d)   be
accompanied with proof that the financial guarantee referred to in section 65
is being maintained.
(2) After filing an application, the applicant must
provide to the Minister any additional information, material and evidence the
Minister considers necessary.
1999 cI‑5.1 s66
Issuing certificates
67 An applicant who applies for a
special broker’s licence or a renewal of a special broker’s licence is entitled
to the licence if the Minister is satisfied that the requirements of this Act
and the regulations relating to the licence have been met.
1999 cI‑5.1 s67
Terms and conditions
68(1) The Minister may issue a special broker’s
licence subject to terms and conditions provided for in the regulations.
(2) Every holder of a special broker’s licence must
comply with the terms and conditions to which the licence is subject.
1999 cI‑5.1 s68
Expiration
69 A special broker’s licence
expires on December 31 of the year in which it is issued or renewed.
1999 cI‑5.1 s69
Status of certificate of
authority
70(1) When a person’s insurance agent’s certificate
of authority expires, the person’s special broker’s licence is automatically
cancelled.
(2) When
a person’s insurance agent’s certificate of authority is suspended or
cancelled, the person’s special broker’s licence is automatically suspended.
(3) The
Minister must reinstate a person’s special broker’s licence that has been
suspended under subsection (1) or (2) for a class of insurance if
                                (a)   the
person submits an application for reinstatement to the Minister,
                                (b)   before
the special broker’s licence would have expired, the certificate of authority
is reinstated or the person is issued an insurance agent’s certificate of
authority for that class of insurance, and
                                (c)   the Minister is satisfied that the person is
in compliance with the requirements of this Act and the regulations relating to
special brokers.
1999 cI‑5.1 s70
Reporting requirements
71 A licensed special broker must within 10
days after the end of each month submit to the Minister a return containing the
following information with respect to the insurance effected under section 63
by the broker during the month:
                                (a)   the
names of the insured;
                                (b)   the
nature of the insurance;
                                (c)   the
names of the unlicensed insurers;
                                (d)   the amount of insurance placed with each
unlicensed insurer and the rate and amount of premium paid to each unlicensed
insurer.
1999 cI‑5.1 s71
Payments in respect of
premiums
72(1) In respect of all premiums on insurance
effected by a licensed special broker, the special broker must pay to the
Minister the taxes that would be payable if the premiums had been received by a
licensed insurer, and the payment must accompany the monthly return provided
for in section 71.
(2) If the amount referred to in subsection (1) is
not paid within 30 days from the time it becomes payable, a sum equal to 50% of
the amount remaining unpaid becomes a penalty that forms a part of the amount
referred to in subsection (1) and is recoverable with the amount.
1999 cI‑5.1 s72
Records
73 A special broker must keep a
separate account of insurance effected by the special broker.
1999 cI‑5.1 s73
Financial guarantee not
in force
74(1) If, during the term of a special broker’s
licence, the financial guarantee referred to in section 65 maintained in
respect of that licence is no longer in force, the special broker must
immediately notify the Minister, in writing, that the guarantee is not in
force.
(2) If,
during the term of a special broker’s licence, the financial guarantee referred
to in section 65 maintained in respect of the licence is no longer in force,
the licence is automatically suspended unless, while the guarantee is in force,
the special broker satisfies the Minister that the special broker has obtained
a new guarantee that meets the requirements of section 65.
(3) The
Minister must reinstate a special broker’s licence that has been suspended
under subsection (2) if
                                (a)   the
broker submits an application for reinstatement to the Minister,
                                (b)   the
broker satisfies the Minister that the broker has obtained a new financial
guarantee that meets the requirements of section 65 before the licence would
have expired, and
                                (c)   the Minister is satisfied that the broker is
in compliance with the requirements of this Act and the regulations relating to
special brokers.
1999 cI‑5.1 s74
Using different names
75 No person may advertise or
carry on business as a special broker in a name other than the name set out in
the person’s special broker’s licence.
1999 cI‑5.1 s75
Release of financial
guarantee
76 A special broker is entitled to a release or
cancellation of the financial guarantee submitted by the special broker when
the Minister is satisfied that all insurance effected under section 63 by the
broker is no longer in force or has been reinsured.
1999 cI‑5.1 s76
Regulations
Regulations
77 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
the maximum proportion of risks that may be reinsured with unlicensed insurers
for the purposes of section 62(3);
                                (b)   respecting
the requirement, conditions, training and experience that must be met before a
special broker’s licence is issued or renewed;
                                (c)   respecting
terms and conditions that may be imposed on a special broker’s licence;
                                (d)   respecting any matter that is to be
prescribed under this Subpart.
1999 cI‑5.1 s77
Subpart 3
Licensing of Reciprocal
Insurance Exchanges
Definitions
78 In this Subpart,
                                (a)   “approved
securities� means
                                          (i)   in respect of a reciprocal insurance exchange that has its
principal office in Alberta, investments that the exchange would be authorized
to make if the exchange were a provincial company,
                                         (ii)   in respect of a reciprocal insurance exchange that has its
principal office in a province other than Alberta, investments that the
exchange is authorized to make under the laws of that province, and
                                        (iii)   in respect of a reciprocal insurance exchange that has its
principal office outside Canada, investments that the exchange is authorized to
make under Part XIII of the Insurance
Companies Act (Canada);
                                (b)   “principal
attorney� means a person authorized by subscribers under a power of attorney to
sign reciprocal contracts on their behalf and to act on the subscribers’ behalf
in respect of any matter specified in the power of attorney relating to those
contracts;
                                (c)   “principal
office� means the main office of the principal attorney;
                                (d)   “reciprocal
contractâ€? means a reciprocal contract of indemnity or inter‑insurance;
                                (e)   “subscribers� means persons exchanging
reciprocal contracts with each other.
1999 cI‑5.1 s78
Licence required
79(1) No person may exchange a reciprocal contract
unless
                                (a)   the
exchange is made by the person’s principal attorney,
                                (b)   the
exchange is part of a reciprocal insurance exchange that is licensed under this
Subpart, and
                                (c)   the
reciprocal contract falls within a class of insurance that the reciprocal
insurance exchange is authorized to undertake.
(2) No person may act as principal attorney or on
behalf of a principal attorney in the exchange of reciprocal contracts for
persons who are resident in Alberta unless the exchange is part of a reciprocal
insurance exchange that is licensed under this Subpart.
1999 cI‑5.1 s79
Exception
80(1) Despite section 79, a person may, with respect
to property located in Alberta, exchange a reciprocal contract that is a
contract of property insurance and that is part of an unlicensed reciprocal
insurance exchange if
                                (a)   the
exchange of the contracts is done for protection only and not for profit,
                                (b)   the
contracts are effected outside Alberta,
                                (c)   the
exchange of contracts is effected without any solicitation by the unlicensed
reciprocal insurance exchange, and
                                (d)   the
person who owns the property, within 30 days after signing the contract,
                                          (i)   notifies the Superintendent in writing under oath of the terms of
the contract, the persons with whom the insurance is placed and the amount of
premium paid or payable or premium notes given or to be given or mutual liability
assumed in connection with the insurance, and
                                         (ii)   at the same time pays to the Minister of Finance a fee equal to
50% of the premium paid or payable or premium notes given or to be given or
mutual liability assumed in connection with the insurance.
(2) If the fee referred to in subsection (1)(d)(ii)
is not paid within 30 days from the time when it becomes payable, a sum equal
to 50% of the fee remaining unpaid becomes a penalty that forms a part of the
fee and is recoverable with the fee.
RSA 2000 cI‑3
s80;2005 c27 s19
Classes of insurance
81 Subject to section 82, a reciprocal
insurance exchange may be licensed to undertake any class of insurance that a
provincial company may be licensed to undertake except for the following
classes:
                                (a)   life
insurance;
                                (b)   accident
insurance;
                                (c)   sickness
insurance;
                                (d)   guarantee insurance.
1999 cI‑5.1 s81
Automobile insurance
82(1) No reciprocal insurance exchange may be
licensed to undertake the type of automobile insurance that is evidenced by a
standard owner’s policy referred to in section 610(6) or a standard garage
policy.
(2) The
Minister may issue a licence to a reciprocal insurance exchange that authorizes
the exchange to undertake automobile insurance, other than the type described
in subsection (1), if the Minister is satisfied that
                                (a)   the
exchange has signed reciprocal contracts or bona fide applications for such
contracts for at least the prescribed number of automobiles, and
                                (b)   arrangements are in effect for the
reinsurance of all liabilities in excess of the prescribed limits.
RSA 2000 cI‑3
s82;2005 c27 s10
Fire insurance
83 The Minister must not issue a
licence to a reciprocal insurance exchange that authorizes the exchange to
undertake fire insurance unless the Minister is satisfied that the exchange has
bona fide applications for reciprocal contracts for at least the prescribed
number of separate fire insurance risks in Alberta or elsewhere and for at
least the prescribed aggregate amount.
1999 cI‑5.1 s83
Application for licence
84(1) Persons who wish to have a reciprocal insurance
exchange licensed must submit the following to the Minister:
                                (a)   the
name of the exchange;
                                (b)   the
name and address of its principal attorney;
                                (c)   the
classes of insurance that cover the reciprocal contracts to be exchanged;
                                (d)   a
copy of the form of the contract, agreement or policy under or by which the
reciprocal contracts are to be effected or exchanged;
                                (e)   a
copy of the form of power of attorney under which the contracts are to be
effected or exchanged;
                                 (f)   the
location of the office from which the contracts are to be issued;
                                (g)   if
the exchange is required by section 94 to have an attorney for service, the
appointment of an individual as its attorney for service and the consent of the
individual to act as the attorney for service;
                                (h)   any
other information required by the Minister.
(2) Persons
who wish to have a reciprocal insurance exchange’s licence renewed must submit
the following to the Minister:
                                (a)   the
name of the exchange;
                                (b)   the
name of its principal attorney;
                                (c)   any other information required by the
Minister.
1999 cI‑5.1 s84
Name of exchange
85 The Minister may refuse to
issue a licence to a reciprocal insurance exchange if the name or designation
under which contracts are issued is so similar to a name or designation of a
licensed exchange or licensed insurer that confusion or deception is likely.
1999 cI‑5.1 s85
Issuing licence
86 Applicants who apply for a licence for a
reciprocal insurance exchange or to renew such a licence are entitled to the
licence if the Minister is satisfied that
                                (a)   the
requirements of this Act and the regulations relating to the licence have been
met, and
                                (b)   in the case of an existing reciprocal
insurance exchange, the exchange is in compliance with the requirements of this
Act and the regulations.
1999 cI‑5.1 s86
Notice of licence
87(1) The Minister must publish a notice of the
licence of a reciprocal insurance exchange in The Alberta Gazette.
(2) This section does not apply to the renewal of a
licence.
1999 cI‑5.1 s87
Premium deposit
88 Every reciprocal insurance
exchange must require its subscribers to provide to its principal attorney, as
a condition of membership in the exchange, a premium reasonably sufficient for
the risk assumed by the exchange.
1999 cI‑5.1 s88
Management of exchange
89 The affairs of a reciprocal
insurance exchange must be managed by an advisory board or committee of
subscribers established in accordance with the power of attorney.
1999 cI‑5.1 s89
Term of licence
90 A licence issued under this
Subpart expires on December 31 of the year in which it is issued or renewed.
1999 cI‑5.1 s90
Annual return
91(1) Every licensed reciprocal insurance exchange
must file an annual return for each calendar year within the time period
specified in subsection (2) that meets the requirements of subsection (3).
(2) The
annual return for a calendar year must be filed by the last day of the
following February.
(3) The
annual return must
                                (a)   set
out the name of the reciprocal insurance exchange and the name and address of
its principal attorney and of its attorney for service,
                                (b)   set
out the financial information required by the Minister that is audited in a
manner that is satisfactory to the Minister,
                                (c)   set
out any other information considered necessary by the Minister, and
                                (d)   be
signed by the principal attorney and at least 2 members of the advisory board
or committee of subscribers of the reciprocal insurance exchange.
(4) If, in the Minister’s opinion, an annual return
prepared by a reciprocal insurance exchange for another jurisdiction meets the
requirements of subsection (3), the exchange may file that return to satisfy
the requirements of subsection (1).
1999 cI‑5.1 s91
Signing contracts
92 After a reciprocal insurance exchange
is licensed under this Subpart, a principal attorney may sign a reciprocal
contract on behalf of a subscriber if the attorney is authorized by a power of
attorney from the subscriber.
1999 cI‑5.1 s92
Court action
93 Despite any condition or stipulation
in a power of attorney or in a reciprocal contract, any action or proceeding in
respect of any such contract may be maintained in any court of competent
jurisdiction in Alberta.
1999 cI‑5.1 s93
Attorney for service
94(1) Every reciprocal insurance exchange whose
principal attorney is not located in Alberta must have an attorney for service
who meets the requirements of subsection (2).
(2) The
attorney for service must be an individual who is resident in Alberta.
(3) Service
of any document in a legal action, suit or proceeding on a reciprocal insurance
exchange may be effected by
                                (a)   delivering
the document to its attorney according to the Minister’s records,
                                (b)   delivering
the document to the address, according to the Minister’s records, of its
attorney, or
                                (c)   sending
the document by registered mail to that address.
(4) A
document sent by registered mail to the attorney’s address in accordance with
subsection (3)(c) is deemed to be served 7 days from the date of mailing unless
there are reasonable grounds for believing that the attorney did not receive
the document at that time or at all.
(5) Every reciprocal insurance exchange that is
required to have an attorney for service must ensure that its attorney’s office
is open during normal business hours.
1999 cI‑5.1 s94
Attorney’s change of address
95 An attorney for service who
changes addresses must, before the change occurs, notify the Minister of the
date of the change and the new address.
1999 cI‑5.1 s95
Change in attorney for
service
96(1) If the attorney for service of a reciprocal
insurance exchange dies or resigns or if an exchange revokes the appointment of
an attorney for service, the exchange must, as soon as is reasonably possible,
provide the Minister with
                                (a)   the
appointment of its new attorney for service, and
                                (b)   the
consent of the individual to act as the attorney for service.
(2) An
attorney for service of a reciprocal insurance exchange who intends to resign
must
                                (a)   give
not less than 60 days’ notice to the exchange, and
                                (b)   send a copy of the notice to the Minister.
1999 cI‑5.1 s96
No attorney for service
97 If a reciprocal insurance
exchange that is required to have an attorney for service does not have an
attorney for service, service on the exchange may be effected by serving the
Superintendent.
1999 cI‑5.1 s97
Requirements for fire
insurance
98(1) A reciprocal insurance exchange that is
authorized to undertake fire insurance must ensure that no subscriber has
assumed on any single fire insurance risk an amount greater than 10% of the net
worth of the subscriber.
(2) The
principal attorney of a reciprocal insurance exchange that is authorized to
undertake fire insurance must file, when requested by the Minister, a statement
under oath
                                (a)   showing
the maximum amount of indemnity on any single fire insurance risk, and
                                (b)   stating that no subscriber has assumed on
any single fire insurance risk an amount greater than 10% of the net worth of
the subscriber.
1999 cI‑5.1 s98
Amount of reserve
99 Every reciprocal insurance exchange must
maintain with the principal attorney as a reserve fund a sum in cash or
approved securities equal to an amount calculated in accordance with the
following formula:
                                         (50% of (A‑B)) + (C‑D)
                                         where
                                         A is the amount
of premiums collected or credited to the accounts of subscribers on reciprocal
contracts in force having one year or less to run;
                                         B is the amount
paid to licensed insurers to reinsure the reciprocal contracts referred to in
A;
                                         C is the amount
of premiums collected or credited to the accounts of subscribers on reciprocal
contracts in force that have more than one year to run less the amount of those
premiums that is attributable to the expired portion of the contracts;
                                         D is
the amount paid to licensed insurers to reinsure the reciprocal contacts
referred to in C less the amount that is attributable to the expired portion of
the reinsurance contracts.
1999 cI‑5.1 s99
Temporary exclusion from
premium calculation
99.1(1) In
this section, “premiums� means premiums collected or credited to the accounts
of subscribers in respect of reciprocal contracts in force.
(2) A reciprocal insurance exchange may
provide for the assessment on its subscribers of a premium surcharge over and
above the premiums required by section 88.
(3) The premium surcharge may be
assessed only during the year in which the reciprocal insurance exchange’s
licence is initially issued and during the first full year of its renewal after
its initial issue, except that the Minister may, on application by the exchange,
extend the period of authorization of the surcharge for further one‑year
periods until the 2nd anniversary of the end of that year in which the licence
was initially issued.
(4) The reciprocal insurance exchange
may exclude the premium surcharges from “premiums� for the purpose of
calculating the reserve fund requirements of section 99.
2003 c19 s33
Guarantee fund
100(1) In addition to the reserve fund referred to in
section 99, every reciprocal insurance exchange must maintain a guarantee fund
in cash or approved securities in an amount calculated in accordance with the
following formula:
                                         (A ‑ B) + C
                                         where
                                         A is all
liabilities associated with the operation of the exchange, including
liabilities under reciprocal contracts undertaken by the exchange;
                                         B is any amount
that is recoverable from licensed insurers that have reinsured the reciprocal
contracts referred to in A;
                                         C is an amount
set out in the regulations.
(2) Cash or approved securities maintained in the
reserve fund referred to in section 99 must not be included in the guarantee
fund.
1999 cI‑5.1 s100
Deficiency
101(1) If a reciprocal insurance exchange does not
have the minimum amount required under sections 99 and 100, the subscribers or
the principal attorney of the exchange must make up the deficiency forthwith.
(2) If funds other than those that accrued from
premiums of subscribers are supplied to make up a deficiency, the funds must,
so long as a deficiency exists, be deposited and held for the benefit of
subscribers under the terms and conditions specified by the Minister.
1999 cI‑5.1 s101
Investments
102(1) Every reciprocal insurance exchange that has
its principal office in a province or territory other than Alberta must ensure
that the funds of the exchange that are required by the laws of the province or
territory in which the principal office is located to be invested
                                (a)   are
invested in approved securities, and
                                (b)   are
within the limits for investments established by the laws of that province or
territory for reciprocal insurance exchanges.
(2) Every
reciprocal insurance exchange that has its principal office outside Canada must
ensure that the funds of the exchange that are required by Part XIII of the Insurance Companies Act (Canada) to be
invested
                                (a)   are
invested in approved securities, and
                                (b)   are within the limits for investments
established by Part XIII of the Insurance
Companies Act (Canada).
1999 cI‑5.1 s102
Contracts
103 No reciprocal insurance exchange may undertake
any liability on a reciprocal contract or on any other contract of insurance
except on behalf of a subscriber.
1999 cI‑5.1 s103
Reinsurance
104 No principal attorney or reciprocal insurance
exchange may effect reinsurance of any risks undertaken by the exchange in any
other reciprocal insurance exchange.
1999 cI‑5.1 s104
Suspension or
cancellation of licence
105(1) If a reciprocal insurance exchange or principal
attorney fails or refuses to comply with or contravenes any provision of this
Act or the regulations, the licence issued to the exchange may be suspended or
cancelled by the Minister after notice and opportunity for a hearing before the
Minister has been given to the exchange or its principal attorney.
(2) A
suspension or cancellation under subsection (1) does not affect the validity of
any reciprocal contracts effected before the suspension or cancellation of the
rights and obligations of subscribers under the contracts.
(3) The principal attorney must give the
subscribers notice of the suspension or cancellation and the Minister must
publish notice of the suspension or cancellation in The Alberta Gazette.
1999 cI‑5.1 s105
Regulations
106 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
the number of automobiles and limits for the purposes of section 82(2);
                                (b)   prescribing
the amount for “C� for the purposes of section 100;
                                (c)   respecting any matter that is to be
prescribed under this Subpart.
1999 cI‑5.1 s106
Part 2
Provincial Companies
Subpart 1
Status and Powers of
Provincial Companies
Capacity of provincial
company
107(1) Subject to this Act, the regulations, its
bylaws and any term or condition in its instrument of incorporation or licence,
a provincial company
                                (a)   has
the capacity and the rights, powers and privileges of an individual, and
                                (b)   has
the capacity to carry on its business, conduct its affairs and exercise its
powers in any jurisdiction outside Alberta to the extent that the laws of that
jurisdiction permit.
(2) A
provincial company must not
                                (a)   carry
on business or exercise any right, power or privilege that it is prohibited
from carrying on or exercising by this Act, the regulations, its bylaws or any
term or condition in its instrument of incorporation or licence, or
                                (b)   exercise any of its rights, powers and
privileges in a manner that contravenes this Act or the regulations.
1999 cI‑5.1 s107
Constructive notice
108 No person is affected by or is
deemed to have notice or knowledge of the contents of a document concerning a
provincial company by reason only that the document has been filed with the
Minister or is available for inspection at an office of the company.
1999 cI‑5.1 s108
Authority of directors,
officers and agents
109 A provincial company, a guarantor of an
obligation of the company or a person claiming through the company must not
assert against a person dealing with the company or dealing with any person who
has acquired rights from the company
                                (a)   that
the instrument of incorporation or bylaws have not been complied with,
                                (b)   that
the persons named in the most recent notice of directors filed with the
Minister under this Act are not the directors of the company,
                                (c)   that
a person held out by the company as a director, an officer or an agent of the
company
                                          (i)   has not been duly appointed, or
                                         (ii)   has no authority to exercise a power or perform a duty that the
director, officer or agent might reasonably be expected to exercise or perform,
                                    or
                                (d)   that
a document issued by any director, officer or agent of the company with actual
or usual authority to issue the document is not valid or not genuine,
unless the person has, or by virtue of the person’s
position with or relationship to the company ought to have, knowledge of those
facts at the relevant time.
1999 cI‑5.1 s109
Main business
110(1) Subject to this Act and the regulations, a
provincial company must not engage in or carry on any business other than
                                (a)   the
business of insurance, or
                                (b)   the
business of providing financial services.
(2) For
the purposes of this Act, the business of insurance includes any activity that
is reasonably ancillary to the business of insurance.
(3) For
the purposes of this Act, the business of providing financial services includes
in respect of a provincial company
                                (a)   acting
as a receiver, liquidator or sequestrator,
                                (b)   issuing
payment, credit or charge cards and, in co‑operation with others
including other financial institutions, operating a payment, credit or charge
card plan,
                                (c)   providing
real property brokerage services,
                                (d)   holding
and otherwise dealing with real property,
                                (e)   providing
information processing services that the company has developed for its own use
and that are an integral part of the company’s operations to entities in which
the company has a substantial investment that do not provide information
processing services to other entities,
                                 (f)   promoting
merchandise and services to the holders of any payment, credit or charge card
issued by the company,
                                (g)   acting
as a custodian of property,
                                (h)   acting
as a trustee for a trust in respect of a prescribed class of transaction,
                                 (i)   any
of the activities referred to in section 111, and
                                 (j)   with
the consent of the Minister, any other activity that is reasonably ancillary to
the business of providing financial services.
(4) Subject
to subsection (5), a provincial company must not carry on an activity that
requires registration under the Securities
Act.
(5) A provincial company may carry on an activity
that is regulated under the Securities
Act if the Securities Act allows
the company to carry on the activity without being registered under that Act.
1999 cI‑5.1 s110
Networking
111 A provincial company may
                                (a)   act
as agent for any person in respect of the provision of any service that is
provided by a financial institution or a body corporate in which the company is
permitted to have a substantial investment,
                                (b)   enter
into an arrangement with any person in respect of the provision of that
service, or
                                (c)   refer any person to any such financial
institution or body corporate.
1999 cI‑5.1 s111
Life insurance
112 No provincial company may
issue a contract of life insurance that does not appear to be self‑supporting
on reasonable assumptions as to interest, mortality and expenses.
1999 cI‑5.1 s112
Security interests
113(1) Subject to subsection (2), a provincial company
must not create a security interest in any property of the company to secure an
obligation of the company.
(2) This
section does not apply to the creation of a security interest
                                (a)   in
relation to the reinsurance by the provincial company of risks insured by
another insurer,
                                (b)   on
prescribed classes of personal property or prescribed classes of transactions,
or
                                (c)   on property having an aggregate value that
is less than the prescribed amount.
1999 cI‑5.1 s113
Beneficial interests
114 A provincial company must not
acquire any beneficial interest in property, other than by way of realization,
that is subject to a security interest.
1999 cI‑5.1 s114
Debt obligations
115(1) A provincial life company must not, and must
not permit its prescribed subsidiaries to, enter into a debt obligation or
issue any share, other than a common share, if as a result the aggregate of the
total debt obligations of the company and the book value of its prescribed
shares would exceed 20% of the total assets of the company.
(2) A provincial property and casualty company must
not, and must not permit its prescribed subsidiaries to, enter into any debt
obligation or issue any share, other than a common share, if as a result the
aggregate of the total debt obligations of the company and the book value of
its prescribed shares would exceed 2% of the total assets of the company.
1999 cI‑5.1 s115
Guarantees
116(1) A provincial company must not guarantee on
behalf of any person other than itself the payment or repayment of any sum of
money unless
                                (a)   the
sum of money is a fixed sum of money with or without interest on the fixed sum,
and
                                (b)   the
person on whose behalf the company has undertaken to guarantee the payment or
repayment has an unqualified obligation to reimburse the company for the full
amount of the payment or repayment to be guaranteed.
(2) Subsection
(1) does not apply in respect of any indemnity referred to in section 365.
(3) Subsection (1)(a) does not apply to a
provincial life company where the person on whose behalf the provincial life
company has undertaken to guarantee a payment or repayment is a subsidiary of
the company and is primarily engaged in insuring risks that fall within a class
of insurance that the company is authorized to insure.
1999 cI‑5.1 s116
Segregated Funds
Segregated funds
restricted to life companies
117 A provincial property and casualty
company must not
                                (a)   issue
policies, or
                                (b)   accept
or retain on the direction of a policyholder or beneficiary policy dividends or
bonuses or policy proceeds that are payable on the surrender or maturity of the
policy or on the death of the person whose life is insured,
where the liabilities of the company in respect of the
policies or the amounts accepted or retained vary in amount depending on the
market value of a fund consisting of a specified group of assets.
1999 cI‑5.1 s117
Where segregated funds
required
118 A provincial life company that issues
policies described in section 117 or accepts or retains amounts described in
section 117 must, in respect of those policies or amounts,
                                (a)   maintain
separate accounts, and
                                (b)   establish and maintain one or more funds
consisting of assets that are segregated from the other assets of the company
and that are specified as the assets on the market value of which the
liabilities of the company in respect of those policies or amounts depend.
1999 cI‑5.1 s118
Creation and maintenance
of segregated funds
119(1) A provincial life company may transfer an
amount to a separate account referred to in section 118(a) for the purpose of
maintaining or establishing a segregated fund under section 118.
(2) Subsection (1) is subject to the regulations
and, in the case of a transfer from a participating account maintained pursuant
to section 294, to the regulations under section 299.
1999 cI‑5.1 s119
Transfers from
segregated funds
120 A provincial life company may,
with the approval of the Minister, return the current value of an amount
transferred pursuant to section 119 to the account from which the amount was
transferred.
1999 cI‑5.1 s120
Claims against
segregated funds
121 A claim against a segregated
fund maintained pursuant to section 118 under a policy or for an amount in
respect of which the fund is maintained has priority over any other claim against
the assets of that fund.
1999 cI‑5.1 s121
Restriction of claims
122 The liability of a provincial life
company under a policy or for an amount in respect of which a segregated fund
is maintained pursuant to section 118
                                (a)   does
not, except to the extent that the assets of the fund are insufficient to
satisfy a claim for any minimum amount that the company agrees to pay under the
policy or in respect of the amount, give rise to a claim against any assets of
the company other than the assets of that fund,
but
                                (b)   to the extent that the assets of the fund
are insufficient to satisfy such a claim, gives rise to a claim against the
assets of the company, other than the assets of that fund.
1999 cI‑5.1 s122
Regulations
Regulations
123 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
the business that a provincial company may engage in or carry on;
                                (b)   respecting
the disclosure of
                                          (i)   the name of the principal for whom a provincial company is acting
as agent pursuant to section 111, and
                                         (ii)   whether any commission is being earned by a provincial company
when acting as agent pursuant to section 111;
                                (c)   respecting
the transfer of amounts in respect of a segregated fund for the purposes of
section 119;
                                (d)   respecting any matter that is to be
prescribed under this Subpart.
1999 cI‑5.1 s123
Subpart 2
Incorporation, Fundamental Changes and Dissolution of Provincial Companies
Alberta insurers
124(1) No insurer may be incorporated, amalgamated or
continued in Alberta unless it is incorporated, amalgamated or continued under
this Act.
(2) No fraternal society may be incorporated,
amalgamated or continued under the laws of Alberta.
1999 cI‑5.1 s124
Division 1
Incorporation
Application
125(1) One or more persons who wish to incorporate a
provincial company must submit an application to the Minister that contains the
following:
                                (a)   the
information, material and evidence specified by the Minister;
                                (b)   a
plan for the future conduct and development of the business of the company;
                                (c)   its
proposed financial year;
                                (d)   the
location of the head office of the company in Alberta;
                                (e)   the
names of the first directors of the company.
(2) After
filing an application for incorporation, the applicants must
                                (a)   provide
to the Minister any additional information, material and evidence the Minister
considers necessary, and
                                (b)   publish
a notice of the application, containing any information that the Minister
specifies, in The Alberta Gazette and in a newspaper having general circulation
in the place where the head office of the provincial company is to be located.
(3) Any
person who objects to the proposed incorporation of a provincial company may,
within 30 days after the date of publication of the notice in The Alberta
Gazette under subsection (2), submit an objection in writing to the Minister.
(4) On
receipt of an objection under subsection (3), the Minister may direct that a
public hearing into the objection be held.
(5) The
Minister may make rules governing the proceedings at public hearings held under
subsection (4), and the Regulations Act
does not apply to the rules.
(6) On the completion of the hearing, the Minister
must ensure that a report of the hearing is made available to the public.
1999 cI‑5.1 s125
Factors to be considered
126 Before recommending that a provincial
company be incorporated, the Minister must take into account all matters that
the Minister considers relevant to the application, including
                                (a)   the
nature and sufficiency of the financial resources of the applicants as a source
of continuing financial support for the company,
                                (b)   the
soundness and feasibility of the plan for the future conduct and development of
the business of the company,
                                (c)   the
business record and experience of the applicants, and
                                (d)   whether the company will be operated by
persons who are fit as to character or who have the competence and experience
suitable for involvement in the operation of an insurer.
1999 cI‑5.1 s126
Incorporation
127 The Lieutenant Governor in
Council may, on the application of one or more persons and on the
recommendation of the Minister, incorporate a provincial company by issuing a
certificate of incorporation.
1999 cI‑5.1 s127
Contents of certificate
of incorporation
128(1) The certificate of incorporation of a provincial
company must set out the name of the company, its financial year and whether
the company is a mutual provincial company.
(2) The Lieutenant Governor in Council may set out
in the certificate of incorporation of a provincial company any term or
condition not contrary to this Act that the Lieutenant Governor in Council
considers advisable to deal with the particular circumstances of the company.
1999 cI‑5.1 s128
Notice of incorporation
129 The Minister must publish a
notice of the incorporation of a provincial company in The Alberta Gazette.
1999 cI‑5.1 s129
First directors
130 The first directors of a
provincial company are the directors named in the application for
incorporation.
1999 cI‑5.1 s130
Effective date of
incorporation
131(1) A provincial company comes into existence and
is incorporated on the date set out in its certificate of incorporation.
(2) A
certificate of incorporation is conclusive proof for the purposes of this Act
and for all other purposes
                                (a)   that
the provisions of this Act in respect of incorporation and all requirements
precedent and incidental to incorporation have been complied with, and
                                (b)   that the provincial company has been
incorporated under this Act on the date set out in the certificate of
incorporation.
1999 cI‑5.1 s131
Division 2
Organization and Commencement
after Incorporation
First directors’ meeting
132(1) After a provincial company is incorporated, the
directors of the company must hold a meeting.
(2) At
that meeting the directors may, subject to this Subpart,
                                (a)   make
bylaws,
                                (b)   adopt
forms of share certificates and corporate records,
                                (c)   authorize
the issue of shares of the company,
                                (d)   appoint
officers,
                                (e)   appoint
an auditor to hold office until the first meeting of shareholders,
                                 (f)   make
banking arrangements, and
                                (g)   deal
with any other matters necessary to organize the company.
(3) An incorporator or a director of the provincial
company may call the meeting referred to in subsection (1) by giving not less
than 5 days’ notice to each director, stating the time and place of the
meeting.
1999 cI‑5.1 s132
Calling shareholders’ meeting
133(1) When the base capital of a provincial company
reaches the amount required under section 25, the directors of the company must
forthwith call a meeting of
                                (a)   the
shareholders of the company, in the case of a company that is not a mutual
provincial company, or
                                (b)   the
incorporators of the company, in the case of a mutual provincial company.
(2) The
shareholders or incorporators of a provincial company must, by resolution at
the meeting called pursuant to subsection (1),
                                (a)   approve,
amend or reject any bylaw made by the directors of the company,
                                (b)   elect
directors to hold office for a term expiring not later than the close of the
first annual meeting of shareholders following the election or, in the case of
a mutual provincial company, not later than the close of the first annual
meeting of policyholders following the election, and
                                (c)   appoint an auditor to hold office until the
close of the first annual meeting of shareholders or, in the case of a mutual
provincial company, until the close of the first annual meeting of
policyholders.
1999 cI‑5.1 s133
Term of first directors
134 A director named in the
application for incorporation of a provincial company holds office until the
election of directors at the meeting of shareholders or incorporators referred
to in section 133(1).
1999 cI‑5.1 s134
Carrying on of business
135 Except as permitted in
sections 136 and 137, a provincial company must not carry on any business until
it is licensed under this Act.
1999 cI‑5.1 s135
Expenses charged to
capital
136 A provincial company must pay
all incorporation and organization expenses from the capital of the company or
interest on the capital and the company must not charge directly or indirectly
its policyholders for those expenses.
1999 cI‑5.1 s136
No payments until
licensed
137 Until a provincial company is licensed
under this Act, the company must not make any payment on account of
incorporation or organization expenses except reasonable sums
                                (a)   for
the payment of remuneration of not more than 2 officers,
                                (b)   for
the payment of costs related to the issue of shares of the company, and
                                (c)   for the payment of clerical assistance,
legal services, accounting services, office accommodation at one location,
office expenses, advertising, stationery, postage and travel expenses.
1999 cI‑5.1 s137
Deposits and investments
138 Until a provincial company is licensed
under this Act, the company may
                                (a)   deposit
its capital and interest on the capital only in a deposit‑taking
institution, and
                                (b)   invest its capital and interest on the
capital only in securities issued or guaranteed by the Government of Canada or
any province or territory.
1999 cI‑5.1 s138
Time limit to acquire
licence
139 If a provincial company does not become
licensed within one year after it comes into existence or within any further
period that the Minister may on application allow,
                                (a)   its
directors must forthwith take all reasonable steps to ensure that the company
is dissolved under Division 11, and
                                (b)   the company must not carry on any business
or activity except for the sole purpose of dissolving the company.
1999 cI‑5.1 s139
Allowed disbursements
140(1) If the directors of a provincial company are
required under section 139 to take all reasonable steps to ensure that the
company is dissolved, no part of the capital of the company or interest on the
capital may be used for the payment of incorporation and organization expenses,
other than remuneration and costs referred to in section 137, unless the
payment has been approved by a special resolution.
(2) If
the amount of a payment approved by a special resolution for the payment of any
incorporation and organization expenses is considered insufficient by the
directors or if no special resolution for the payment of such expenses is
passed, the directors may apply to the Court to settle and determine the
amounts to be paid out of the capital of the company and interest on the
capital before distribution of the balance to the shareholders or, where there
are no shareholders, to the incorporators.
(3) The
directors must, at least 21 days prior to the date fixed for the hearing of the
application referred to in subsection (2), send to the shareholders or
incorporators, as the case may be, a notice of the application, which notice
must contain a statement of the amounts that are proposed to be settled and
determined by the Court.
(4) In
order that the amounts paid and payable under this section may be equitably
borne by the shareholders or incorporators, as the case may be, the directors
must, after the amounts of the payments have been approved by special
resolution or settled and determined by the Court, fix the proportionate part
of the amount of the payment chargeable to each shareholder or incorporator in
the ratio of the amount paid in by each shareholder or incorporator to the
aggregate of all the amounts paid in by all the shareholders or incorporators.
(5) After the amounts referred to in this section
have been paid, the directors must pay to the shareholders or incorporators the
respective balances of the money paid in by them together with any interest
earned on that money, less the amount chargeable to each shareholder or
incorporator under subsection (4).
1999 cI‑5.1 s140
Division 3
Continuance into Alberta
Restriction on
continuance
141 Despite anything in this
Division, no insurer formed outside Canada may be continued as a provincial
company under this Act.
1999 cI‑5.1 s141
Continuance from another
jurisdiction
142 A federally authorized company or an
extra‑provincial company may be continued as a provincial company if
                                (a)   the
company submits an application to the Minister,
                                (b)   the
continuance of the company is authorized under the Act under which the company
is incorporated,
                                (c)   the
applicant meets the requirements for incorporation under this Act,
                                (d)   the
Minister has received evidence showing the proposed continuance has been
approved in conformity with the laws of the jurisdiction in which the company
was incorporated,
                                (e)   the
Minister is satisfied that continuance as a provincial company will not
adversely affect the policyholders, security holders or creditors of the
company, and
                                 (f)   the company intends to undertake the classes
of insurance in Alberta that it was authorized to undertake in the jurisdiction
in which it was incorporated.
1999 cI‑5.1 s142
Certificate of
continuance
143(1) The Lieutenant Governor in Council may, on the
recommendation of the Minister, issue a certificate of continuance continuing a
federally authorized company or an extra‑provincial company as a
provincial company.
(2) The
certificate of continuance must set out the name of the company, its financial
year and whether the company is a mutual provincial company.
(3) The Lieutenant Governor in Council may set out
in the certificate of continuance any term or condition that the Lieutenant
Governor in Council considers advisable to deal with the particular
circumstances of the company.
1999 cI‑5.1 s143
Effect of certificate of
continuance
144(1) On the date set out in the certificate of
continuance continuing a federally authorized company or an extra‑provincial
company as a provincial company,
                                (a)   the
company becomes a provincial company as if it had been incorporated under
Division 1, and
                                (b)   the
certificate of continuance is the instrument of incorporation of the continued
company.
(2) A
certificate of continuance is conclusive proof for the purposes of this Act and
for all other purposes
                                (a)   that
the provisions of this Act in respect of continuance and all requirements
precedent and incidental to continuance have been complied with, and
                                (b)   that the provincial company has been
continued under this Act on the date set out in the certificate of continuance.
1999 cI‑5.1 s144
Notice of continuance
145(1) The Minister must publish a notice of the
continuance of a federally authorized company or an extra‑provincial
company in The Alberta Gazette.
(2) When a federally authorized company or an extra‑provincial
company is continued as a provincial company, the Minister must forthwith send
a copy of the certificate of continuance to the appropriate official or public
body in the jurisdiction in which the federally authorized company or extra‑provincial
company was authorized to apply to be continued under this Division.
1999 cI‑5.1 s145
Effects of continuance
146 When a federally authorized company or an
extra‑provincial company (referred to as the “body corporateâ€?) is
continued as a provincial company under this Division,
                                (a)   the
property of the body corporate continues to be the property of the provincial
company,
                                (b)   the
provincial company continues to be liable for the obligations of the body
corporate,
                                (c)   an
existing cause of action or claim by or against the body corporate or any
liability of the body corporate to prosecution is unaffected,
                                (d)   a
civil, criminal or administrative action or proceeding pending by or against
the body corporate may continue to be prosecuted by or against the provincial
company,
                                (e)   a
conviction against or ruling, order or judgment in favour of or against the
body corporate may be enforced by or against the provincial company,
                                 (f)   a
person who, on the day the body corporate becomes a provincial company, was the
holder of a security issued by the body corporate is not deprived of any right
or privilege available to the person at that time in respect of the security or
relieved of any liability in respect of the security, but any such right or
privilege may be exercised only in accordance with this Act, and
                                (g)   the bylaws of the body corporate, except
those bylaws that are in conflict with this Act, continue as the bylaws of the
provincial company.
1999 cI‑5.1 s146
Division 4
Continuance out of Alberta
Continuance in another
jurisdiction
147(1) Subject to section 148, a provincial company
may, if
                                (a)   the
proposed continuance is approved by a special resolution of the participating
policyholders and shareholders, and
                                (b)   the
Minister approves the proposed continuance on being satisfied that the
continuance will not adversely affect the policyholders, security holders or
creditors of the company,
apply to the
appropriate official or public body of another jurisdiction requesting that the
company be continued in that other jurisdiction as if it had been incorporated
under the laws of that other jurisdiction.
(2) The
directors of the provincial company must submit the proposed continuance to a
meeting of the participating policyholders and shareholders for approval.
(3) The
directors must give notice of the meeting and particulars of the proposed
continuance
                                (a)   in accordance with section 270, and
                                (b)   to
the Minister at least 21 days before the meeting.
(4) The provincial company must advise the Minister
if the special resolution approving the continuance is passed.
1999 cI‑5.1 s147
Requirements for other
jurisdiction’s law
148 A provincial company may be continued as
a body corporate under the laws of another jurisdiction only if those laws
provide in effect that, if the company is continued,
                                (a)   the
property of the provincial company continues to be the property of the body
corporate,
                                (b)   the
body corporate continues to be liable for the obligations of the provincial
company,
                                (c)   an
existing cause of action, claim or liability to prosecution is unaffected by
the continuance,
                                (d)   a
civil, criminal or administrative action or proceeding pending by or against
the provincial company may continue to be prosecuted by or against the body
corporate, and
                                (e)   a conviction against or ruling, order or
judgment in favour of or against the provincial company may be enforced by or
against the body corporate.
1999 cI‑5.1 s148
Abandoning application
149 The directors of a provincial
company may, if authorized by the participating policyholders and shareholders
at the time of approving a proposed continuance under this Division, abandon
the application for continuance without further approval of the participating
policyholders or shareholders.
1999 cI‑5.1 s149
Certificate of discontinuance
150(1) On receipt of notice satisfactory to the
Minister that the provincial company has been continued under the laws of
another jurisdiction, the Minister must file the notice and issue a certificate
of discontinuance, and the continued company is no longer a provincial company.
(2) The Minister must publish a notice of the
certificate of discontinuance in The Alberta Gazette.
1999 cI‑5.1 s150
Division 5
Mutualization
Conversion into mutual
provincial company
151(1) On the application of a provincial company, the
Minister may issue a certificate converting the provincial company into a
mutual provincial company.
(2) The Minister must not issue the certificate
unless the requirements of the regulations have been met.
1999 cI‑5.1 s151
Regulations
152 The Lieutenant Governor in
Council may make regulations respecting mutualization proposals and procedures
and requirements that must be met before a provincial company may be converted
into a mutual provincial company.
1999 cI‑5.1 s152
Payment
153 Despite anything in this Act, a
provincial company may, with the approval of the Minister, pay for shares
purchased or otherwise acquired pursuant to a mutualization proposal by
                                (a)   making
a promissory note that is, or issuing debt securities that are, payable at a
fixed or determinable future time not later than 10 years after the date of its
making or their issue, or
                                (b)   issuing shares that a mutual provincial
company may issue.
1999 cI‑5.1 s153
Division 6
Demutualization
Conversion into
provincial company with common shares
154(1) On the application of a mutual provincial
company, the Minister may issue a certificate converting the mutual provincial
company into a provincial company with common shares.
(2) The
Minister must not issue the certificate unless the requirements of the
regulations have been met.
(3) On the day that the certificate becomes
effective the policyholders of the company cease to have any rights with
respect to the company as a mutual provincial company or any interest in the company
as a mutual provincial company.
1999 cI‑5.1 s154
Regulations
155(1) The Lieutenant Governor in Council may make
regulations
                                (a)   respecting
demutualization proposals and procedures and requirements that must be met
before a mutual provincial company may be converted into a provincial company
with common shares;
                                (b)   governing
the ownership of shares issued by a mutual provincial company that has been
converted into a provincial company with common shares.
(2) A
regulation made under this section may provide that the Minister may, by order,
on such terms and conditions as the Minister considers appropriate, exempt a
provincial company from prescribed requirements of that regulation.
(3) The
Minister may, on such terms and conditions as the Minister considers
appropriate, exempt a mutual provincial company from any requirement of this
Act or the regulations if
                                (a)   the
company is applying to convert the company into a company with common shares,
and
                                (b)   the Minister is of the opinion that the
company is, or is about to be, in financial difficulty and that the exemption
would help to facilitate an improvement in the financial condition of the
company.
1999 cI‑5.1 s155
Division 7
Change of Name, Financial Year and Terms and Conditions
Change of name and financial
year
156(1) On the application of a provincial company
authorized by special resolution, the Minister may issue a certificate
                                (a)   changing
the name of the company, or
                                (b)   changing
the financial year of the company.
(2) Before an application is made under subsection
(1) to change the name of a provincial company, a notice of intention to make
the application must be published by the applicant in The Alberta Gazette and
in a newspaper in general circulation in the place where the head office of the
company is located.
1999 cI‑5.1 s156
Changing terms and
conditions
157 On the application of a
provincial company authorized by special resolution, the Lieutenant Governor in
Council may issue a certificate adding, changing or removing any term or condition
that is set out in the company’s instrument of incorporation.
1999 cI‑5.1 s157
Proposal to amend
158(1) Subject to subsection (2), a director or a
participating policyholder or shareholder of a provincial company may, in
accordance with sections 274 and 275, make a proposal to make an application
referred to in section 156 or 157.
(2) Notice of a meeting of participating
policyholders or shareholders at which a proposal to amend the instrument of
incorporation is to be considered must set out the proposal.
1999 cI‑5.1 s158
Division 8
Amalgamation
Amalgamation
159(1) Two or more provincial companies may amalgamate
under this Division to become one provincial company.
(2) One
or more provincial companies may amalgamate under this Division with one or
more extra‑provincial or federally authorized companies that are licensed
under this Act to become one provincial company.
(3) Despite anything in this Division, no insurer
formed outside Canada may be amalgamated under this Act.
1999 cI‑5.1 s159
Amalgamation agreement
160(1) The companies proposing to amalgamate must
enter into an amalgamation agreement.
(2) An amalgamation agreement does not take effect
until the Minister’s approval under section 161 and the participating
policyholders’ and shareholders’ approval under section 163 have been obtained.
1999 cI‑5.1 s160
Minister’s approval
161(1) Before an amalgamation agreement is submitted
for participating policyholders’ and shareholders’ approval under section 163,
the agreement must be submitted to the Minister for approval, and any
participating policyholders’ or shareholders’ approval under section 163 is
invalid if it is obtained prior to the Minister’s approval.
(2) An
amalgamation agreement submitted to the Minister for approval must be accompanied
with the report of an independent actuary on the agreement.
(3) The
Minister must not approve the amalgamation agreement unless the Minister is
satisfied that
                                (a)   the
agreement meets the requirements of the regulations,
                                (b)   the
laws of the jurisdiction in respect of each company that is proposing to
amalgamate permit the proposed amalgamation, and the proposed amalgamation has
obtained the approvals required under the laws of those jurisdictions, and
                                (c)   the requirements of the regulations for amalgamation
have been met.
1999 cI‑5.1 s161
Regulations
162 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
the requirements for amalgamation agreements;
                                (b)   respecting requirements that must be met
before companies may be amalgamated under this Division.
1999 cI‑5.1 s162
Policyholder and
shareholder approval
163(1) In this section, “company� means a company that
is proposing to amalgamate under this Division.
(2) The
directors of each company must submit an amalgamation agreement for approval to a meeting of the participating
policyholders and shareholders of the company of which they are directors and,
subject to subsection (4), to the holders of each class or series of shares.
(3) Each
share of a company carries the right to vote in respect of an amalgamation
whether or not it otherwise carries the right to vote.
(4) The
holders of shares of a class or series of shares of a company are entitled to
vote separately as a class or series in respect of an amalgamation if the amalgamation
agreement contains a provision that, if contained in a proposed amendment to
the bylaws or instrument of incorporation of the company, would entitle those
holders to vote separately as a class or series.
(5) Participating
policyholders are entitled to vote separately from shareholders in respect of
an amalgamation agreement.
(6) Subject
to subsections (4) and (5), an amalgamation agreement is approved when the
participating policyholders and shareholders of each company have approved the
amalgamation by special resolution.
(7) An amalgamation agreement may provide that, at
any time before the issue of a certificate of amalgamation, the agreement may
be terminated by the directors of a company even though the agreement has been
approved by the participating policyholders or shareholders of all or any of
the companies that are proposing to amalgamate.
1999 cI‑5.1 s163
Joint application to
Minister
164(1) Subject to subsection (2), unless an
amalgamation agreement is terminated in accordance with section 163(7),
companies that are proposing to amalgamate must, within 3 months after the
Minister approves their amalgamation agreement, jointly apply to the Minister
for a certificate of amalgamation continuing the companies as one provincial
company.
(2) No
application for the issue of a certificate of amalgamation may be made unless
                                (a)   notice
of intention to make such an application has been published in The Alberta
Gazette and in a newspaper in general circulation in the place where the head
office of each applicant is located, and
                                (b)   the application is supported by satisfactory
evidence that the applicants have complied with the requirements of this
Division and the regulations relating to amalgamation.
1999 cI‑5.1 s164
Certificate of
amalgamation
165(1) Where an application has been made to the
Minister in accordance with section 164, the Lieutenant Governor in Council may
issue a certificate of amalgamation continuing the applicants as one provincial
company.
(2)
Section 128 applies with such modifications as the circumstances require when a
certificate of amalgamation is issued pursuant to this section.
(3) The Minister must publish notice of the
issuance of the certificate of amalgamation in The Alberta Gazette.
1999 cI‑5.1 s165
Effect of certificate
166(1) On the date set out in the certificate of
amalgamation issued under section 165,
                                (a)   the
amalgamation of the applicants and their continuance as one provincial company
are effective;
                                (b)   the
property of each applicant is the property of the amalgamated company;
                                (c)   the
amalgamated company is liable for the obligations of each applicant;
                                (d)   any
existing cause of action, claim or liability to prosecution is unaffected;
                                (e)   any
civil, criminal or administrative action or proceeding pending by or against an
applicant may be prosecuted by or against the amalgamated company;
                                 (f)   any
conviction against or ruling, order or judgment in favour of or against an
applicant may be enforced by or against the amalgamated company;
                                (g)   if
any director or officer of an applicant continues as a director or officer of
the amalgamated company, any disclosure of a material interest in any contract
made to the applicant by that director or officer is deemed to be disclosure to
the amalgamated company;
                                (h)   the
certificate of amalgamation is the instrument of incorporation of the
amalgamated company.
(2) Any deemed disclosure under subsection (1)(g)
must be recorded in the minutes of the first meeting of the directors of the
amalgamated company.
1999 cI‑5.1 s166
Transitional
167(1) Despite anything in this Act or the
regulations, the Minister may grant to a company in respect of which a
certificate of amalgamation has been issued under this Division permission
                                (a)   to
engage in a business activity that a provincial company is not otherwise
permitted by this Act to engage in and that one or more of the amalgamating
companies was engaging in at the time the application for the certificate was
made,
                                (b)   to
continue to have issued and outstanding debt obligations the issue of which is
not authorized by this Act if the debt obligations were outstanding at the time
the application for the certificate was made,
                                (c)   to
hold assets that a provincial company is not otherwise permitted by this Act to
hold if the assets were held by one or more of the amalgamating companies at
the time the application for the certificate was made,
                                (d)   to
acquire and hold assets that a provincial company is not otherwise permitted by
this Act to acquire or hold if one or more of the amalgamating companies was
obliged, at the time the application for the certificate was made, to acquire
those assets, and
                                (e)   to
maintain outside Canada any records or registers required by this Act to be
maintained in Canada and maintain and process, outside Canada, information and
data relating to the preparation and maintenance of such records or registers.
(2) The
permission granted under subsection (1) must be expressed to be granted for a
specific period not exceeding
                                (a)   with
respect to any matter described in subsection (1)(a), 30 days after the date of
issue of the certificate or, where the activity is conducted pursuant to an
agreement existing on the date of issue of the certificate, the expiration of
the agreement,
                                (b)   with
respect to any matter described in subsection (1)(b), 10 years, and
                                (c)   with
respect to any matter described in subsection (1)(c), (d) or (e), 2 years.
(3) Subject
to subsection (4), the Minister may renew a permission granted under subsection
(1) with respect to any matter described in subsection (1)(b), (c) or (d) for
such further period or periods as the Minister considers necessary.
(4) The
Minister must not grant to a provincial company any permission
                                (a)   with
respect to matters described in subsection (1)(b) that purports to be effective
more than 10 years after the amalgamation became effective unless the Minister
is satisfied on the basis of evidence on oath provided by an officer of the
company that the company will not be able at law at the end of the 10 years to
redeem the outstanding debt obligations to which the permission relates, and
                                (b)   with respect to matters described in
subsection (1)(c) and (d), that purports to be effective more than 10 years
after the amalgamation became effective.
1999 cI‑5.1 s167
Notice to other
jurisdiction
168 When a federally authorized
company or an extra‑provincial company is amalgamated with a provincial
company under this Division, the Minister must forthwith send a copy of the
certificate of amalgamation to the appropriate official or public body in the
jurisdiction in which the federally authorized company or extra‑provincial
company was authorized to apply to be amalgamated under this Division.
1999 cI‑5.1 s168
Division 9
Provincial Company Amalgamating Under the Laws of Another Jurisdiction
Amalgamation agreement
169(1) A provincial company proposing to amalgamate
with one or more companies under the laws of another jurisdiction must enter
into an amalgamation agreement with the other companies.
(2) A provincial company must not proceed with an
amalgamation referred to in subsection (1) unless the Minister approves the
amalgamation agreement.
1999 cI‑5.1 s169
Notice of intention
170(1) Before an amalgamation agreement referred to in
section 169 is made, a notice of intention to make the agreement must be
published
                                (a)   in
The Alberta Gazette, and
                                (b)   in
a newspaper in general circulation in the place where the head office of the
provincial company is located,
stating the date on or
after which the application will be made to the Minister to approve the
agreement, that date being at least 30 days after the date of publication of
the notice.
(2) Where
a provincial company publishes a notice referred to in subsection (1), the
Minister may direct the company to provide its policyholders and shareholders
with the information the Minister specifies.
(3) Where
a provincial company publishes a notice referred to in subsection (1), the
company must make the proposed agreement to which the notice relates available
for inspection by the policyholders and shareholders of the company at the head
office of the company for a period of at least 30 days after the publication of
the notice and provide a copy of the agreement to any policyholder or
shareholder who sends a request in writing to the head office of the company.
(4) Where
the Minister is of the opinion that it is in the best interests of a group of
policyholders affected by an agreement, the Minister may shorten the periods of
30 days referred to in subsections (1) and (3).
(5) The
Minister may designate a professional advisor to evaluate the agreement and the
provincial company that is proposing to enter into the agreement must provide
any assistance required by the professional advisor to enable the advisor to
complete the evaluation.
(6) The remuneration and expenses of the
professional advisor for carrying out the evaluation under subsection (5) are
payable by the provincial company on being approved by the Minister.
1999 cI‑5.1 s170
Participating
policyholder and shareholder approval
171(1) A provincial company proposing to make an
amalgamation agreement referred to in section 169 must submit the proposed
agreement for approval at a meeting of the participating policyholders and
shareholders and, subject to subsection (3), to the holders of each class or
series of shares.
(2) Each
share of the provincial company carries the right to vote in respect of a
proposed agreement whether or not the share otherwise carries the right to
vote.
(3) The
holders of shares of a class or series of shares of a provincial company are
entitled to vote separately as a class or series in respect of a proposed
agreement submitted under subsection (1) if the effect of the agreement on the
shares of the class or series is different from the effect on the shares of
another class or series.
(4) Participating
policyholders are entitled to vote separately from shareholders in respect of
an agreement.
(5) For the purpose of subsection (1), and subject
to subsections (3) and (4), an agreement is approved when the participating
policyholders and shareholders have approved the agreement by special
resolution.
1999 cI‑5.1 s171
Abandoning voting
agreement
172 Where a special resolution
approving an amalgamation agreement under section 171(5) so states, the directors
of a provincial company may, subject to the rights of third parties, abandon
the agreement without further approval of the participating policyholders and
shareholders.
1999 cI‑5.1 s172
Application to Minister
173(1) Unless an amalgamation agreement is abandoned
in accordance with section 172, a provincial company referred to in section
171(1) must, within 3 months after the agreement has been approved in
accordance with section 171(5), apply to the Minister for approval of the
agreement.
(2) An amalgamation agreement has no force or
effect until it has been approved by the Minister.
1999 cI‑5.1 s173
Certificate of
discontinuance
174(1) On receipt of a notice satisfactory to the
Minister that a provincial company has been amalgamated under the laws of
another jurisdiction, the Minister must file the notice and issue a certificate
of discontinuance, and the amalgamated company is no longer a provincial
company.
(2) The Minister must publish a notice of the
certificate of discontinuance in The Alberta Gazette.
1999 cI‑5.1 s174
Division 10
Transfer of Business and
Fundamental Reinsurance
Interpretation
175(1) In this Division, “Division 10 agreement� means
an agreement in which an insurer
                                (a)   fundamentally
reinsures any of its contracts of insurance,
                                (b)   fundamentally
reinsures any of the contracts of insurance of any other insurer, or
                                (c)   sells
all or substantially all of its assets.
(2) In
this Division, a contract of insurance is fundamentally reinsured if
                                (a)   the
insurer under the contract transfers or assigns all rights and obligations
under the contract to another insurer, or
                                (b)   the contract is replaced by novation and the
insurer under the replacement contract is different from the insurer under the
original contract.
1999 cI‑5.1 s175
Notice of intention
176(1) Before a provincial company enters into a
Division 10 agreement, the company must publish a notice of intention to enter
into the agreement
                                (a)   in
The Alberta Gazette, and
                                (b)   in
a newspaper in general circulation in the place where the head office of the
provincial company is located,
stating the date on or
after which the application will be made to the Minister to approve the
agreement, that date being at least 30 days after the date of publication of
the notice.
(2) Where
a provincial company publishes a notice referred to in subsection (1), the
Minister may direct the company to provide its policyholders and shareholders
with the information the Minister specifies.
(3) Where
a provincial company publishes a notice referred to in subsection (1), the
company must make the proposed agreement to which the notice relates available
for inspection by the policyholders and shareholders of the company at the head
office of the company for a period of at least 30 days after the publication of
the notice and provide a copy of the agreement to any policyholder or
shareholder who sends a request in writing to the head office of the company.
(4) Where
the Minister is of the opinion that it is in the best interests of a group of
policyholders affected by an agreement, the Minister may shorten the periods of
30 days referred to in subsections (1) and (3).
(5) The
Minister may designate a professional advisor to evaluate the agreement, and
the provincial company that is proposing to enter into the agreement must
provide any assistance required by the professional advisor to enable the
advisor to complete the evaluation.
(6) The remuneration and expenses of the
professional advisor for carrying out the evaluation under subsection (5) are
payable by the provincial company on being approved by the Minister.
1999 cI‑5.1 s176
Participating
policyholder and shareholder approval
177(1) A provincial company proposing to make a
Division 10 agreement must submit the proposed agreement for approval at a
meeting of the participating policyholders and shareholders and, subject to
subsection (3), to the holders of each class or series of shares.
(2) Each
share of the provincial company carries the right to vote in respect of a
proposed agreement whether or not the share otherwise carries the right to
vote.
(3) The
holders of shares of a class or series of shares of a provincial company are
entitled to vote separately as a class or series in respect of a proposed
agreement submitted under subsection (1) if the effect of the agreement on the
shares of the class or series is different from the effect on the shares of
another class or series.
(4) Participating
policyholders are entitled to vote separately from shareholders in respect of
an agreement.
(5) For the purpose of subsection (1), and subject
to subsections (3) and (4), an agreement is approved when the participating
policyholders and shareholders have approved the agreement by special
resolution.
1999 cI‑5.1 s177
Abandoning agreement
178 Where a special resolution
approving a Division 10 agreement under section 177(5) so states, the directors
of a provincial company may, subject to the rights of third parties, abandon
the agreement without further approval of the participating policyholders and shareholders.
1999 cI‑5.1 s178
Application to Minister
179(1) Unless a Division 10 agreement is abandoned in
accordance with section 178, a provincial company referred to in section 177(1)
must, within 3 months after the agreement has been approved in accordance with
section 177(5), apply to the Minister for approval of the agreement.
(2) A
Division 10 agreement in which a provincial company is a party has no force or
effect until it has been approved by the Minister.
(3) The Minister must not approve a Division 10
agreement if the reinsuring or purchase or sale of assets would cause any
provincial company that would be a party to the agreement to be in
contravention of the capital adequacy or liquidity requirements of Subpart 10.
1999 cI‑5.1 s179
Federal and
extra-provincial companies
180(1) A licensed federally authorized company or
extra‑provincial company that enters into a Division 10 agreement to
fundamentally reinsure any of its contracts of insurance that are made in
Alberta with another licensed federally authorized company or extra‑provincial
company must provide a copy of the agreement to the Minister.
(2) A
Division 10 agreement referred to in subsection (1) does not affect contracts
of insurance that are made in Alberta until the Division 10 agreement has been
provided to the Minister.
(3) The Minister may require a licensed federal or
extra‑provincial company that is fundamentally reinsuring contracts of
insurance made in Alberta to notify, in a form and manner satisfactory to the
Minister, the policyholders under those contracts of the fundamental
reinsurance.
1999 cI‑5.1 s180
Division 11
Dissolution and Revival
Application
181 This Division does not apply to a
mutual provincial company.
1999 cI‑5.1 s181
Insolvent provincial
companies
182(1) This Division does not apply to a provincial
company that is insolvent within the meaning of that term in the Winding‑up and Restructuring Act
(Canada).
(2) Any proceedings taken under this Division to
dissolve or to liquidate and dissolve a provincial company must be stayed if
the company is at any time found to be insolvent within the meaning of that
term in the Winding‑up and
Restructuring Act (Canada).
1999 cI‑5.1 s182
Returns to Minister
183 A liquidator appointed under this
Division to wind up the business of a provincial company must provide the
Minister with the information relating to the business and affairs of the
company in the form the Minister requires.
1999 cI‑5.1 s183
Simple Dissolution
No property and no
liabilities
184(1) A provincial company that has no property and
no liabilities may, if authorized by a special resolution of the shareholders
or, if there are no shareholders, by a resolution of all the directors, apply
to the Minister for a certificate dissolving the company.
(2) The
Minister may require a provincial company that has applied for a certificate of
dissolution to publish a notice of the application in The Alberta Gazette that
contains any information that the Minister specifies.
(3)
Where the Minister has received an application under subsection (1) and is
satisfied that all the circumstances so warrant, the Lieutenant Governor in
Council may issue a certificate of dissolution that dissolves the provincial
company.
(4) A provincial company is dissolved and ceases to
exist on the date stated in the certificate of dissolution.
1999 cI‑5.1 s184
Property and liabilities
185(1) The voluntary liquidation and dissolution of a
provincial company that has property or has property and liabilities
                                (a)   may
be proposed by its directors, or
                                (b)   may
be initiated in accordance with sections 274 and 275 by way of a proposal made
by a shareholder who is entitled to vote at an annual meeting of shareholders.
(2) A notice of any meeting of shareholders at
which the voluntary liquidation and dissolution of a provincial company is to
be proposed must set out the terms of the proposal.
1999 cI‑5.1 s185
Application
186 Where the voluntary liquidation and
dissolution of a provincial company is proposed under section 185, the company
may apply to the Minister for a certificate dissolving the company if
authorized by a special resolution of the shareholders or, where the company
has issued more than one class of shares, by special resolution of each class
of shareholders whether or not those shareholders are otherwise entitled to
vote.
1999 cI‑5.1 s186
Approval of Minister
required
187(1) No action directed toward the voluntary
liquidation and dissolution of a provincial company under section 185 may be
taken by a company until an application made by the company in accordance with
section 186 has been approved by the Minister.
(2) The
Minister may approve an application made pursuant to section 186 where the
Minister is satisfied on the basis of the application that
                                (a)   the
circumstances warrant the voluntary liquidation and dissolution of the
provincial company, and
                                (b)   the
company, in accordance with the provisions of Division 10,
                                          (i)   has transferred or will be transferring all or substantially all
of its policies, or
                                         (ii)   has reinsured or will be reinsuring itself against all or
substantially all of the risks undertaken by it.
(3)
Where the Minister has approved an application under section 186 with respect
to a provincial company, the company must not carry on business except to the
extent necessary to complete its voluntary liquidation.
(4) Where
the Minister has approved an application under section 186 with respect to a
provincial company, the company must
                                (a)   cause
notice of the approval to be sent to each known claimant against and creditor
of the company, except policyholders,
                                (b)   publish
notice of the approval in The Alberta Gazette and in a newspaper having general
circulation in the place where the head office of the company is located and
take reasonable steps to give notice of the approval of the application in each
province or territory in which the company transacted any business within the
preceding 12 months,
                                (c)   proceed
to collect its property, dispose of property that is not to be distributed in
kind to its shareholders, discharge or provide for all its obligations and do
all other acts required to liquidate its business,
                                (d)   transfer
its remaining policies, or reinsure itself against the remaining risks
undertaken by it, and
                                (e)   after giving the notice required under clauses
(a) and (b) and adequately providing for the payment or discharge of all its
obligations, distribute its remaining property, either in money or in kind,
among its shareholders according to their respective rights.
1999 cI‑5.1 s187
Certificate of dissolution
188(1) Unless the Court has made an order in
accordance with section 189, 190 or 191, the Lieutenant Governor in Council
may, if satisfied that the provincial company has complied with section 187(4)
and that all the circumstances so warrant, issue a certificate of dissolution
that dissolves the company.
(2) A provincial company is dissolved and ceases to
exist on the date stated in the certificate of dissolution.
1999 cI‑5.1 s188
Court Supervised
Liquidation
Court supervision -
voluntary liquidation
189(1) The Minister or any interested person may, at
any time during the voluntary liquidation of a provincial company, apply to the
Court for an order directing that the company be wound up subject to the
supervision of the Court in accordance with this section and sections 192 to
203, and on such application the Court may so order and make any further order
it thinks fit.
(2) An
application under subsection (1) to the Court for supervision of a voluntary
liquidation must state the reasons, verified by an affidavit of the applicant,
why the Court should supervise the liquidation.
(3) Where a person other than the Minister makes an
application under subsection (1), the person must give the Minister notice of
the application, and the Minister may appear and be heard in person or by
counsel at the hearing of the application.
1999 cI‑5.1 s189
Court supervision -
involuntary liquidation
190(1) The Minister or any interested person may, for
the reasons referred to in subsection (2), apply to the Court for an order
directing that a provincial company be wound up subject to the supervision of
the Court in accordance with this section and sections 192 to 203.
(2) The
Court may so order and make any further order it sees fit if the Court is
satisfied that
                                (a)   the
company has failed to exercise its corporate powers for any continuous period
of 4 years,
                                (b)   the
company has not commenced business or gone into actual operation within 4 years
after it was incorporated,
                                (c)   the
company has discontinued business for one year after it has undertaken
insurance contracts within the meaning of this Act,
                                (d)   the
company’s licence has been suspended for one year or more,
                                (e)   the
company has contravened this Act or the regulations and it is in the public
interest that the company be wound up, or
                                 (f)   other sufficient cause has been shown.
1999 cI‑5.1 s190
Application by
provisional liquidator
191(1) A provisional liquidator of a provincial
company appointed under section 57(1) must apply to the Court for an order directing
that the provincial company be wound up subject to the supervision of the Court
in accordance with this section and sections 192 to 203 and for an order
appointing a permanent liquidator.
(2) The Court may so order and may make any further
order it sees fit.
1999 cI‑5.1 s191
Effect of Court
supervision
192(1) When the Court makes an order under section
189, 190 or 191, the liquidation of the provincial company is subject to the
supervision of the Court.
(2) The supervision of the liquidation of a provincial
company by the Court pursuant to an order made under section 189, 190 or 191
commences on the date the order is made.
1999 cI‑5.1 s192
Powers of Court
193(1) In connection with the liquidation and
dissolution of a provincial company, the Court may, where it is satisfied that
the company is able to pay or adequately provide for the discharge of all its
obligations and to make satisfactory arrangements for the protection of its
policyholders, make any order it thinks fit, including, without limiting the
generality of the foregoing,
                                (a)   an
order to liquidate;
                                (b)   an
order appointing a liquidator, with or without security, fixing a liquidator’s
remuneration and replacing a liquidator;
                                (c)   an
order appointing inspectors or referees, specifying their powers, fixing their
remuneration and replacing inspectors or referees;
                                (d)   an
order determining the notice to be given to any interested person, or
dispensing with notice to any person;
                                (e)   an
order determining the validity of any claims made against the company;
                                 (f)   an
order, at any stage of the proceedings, restraining the directors and officers
of the company from
                                          (i)   exercising any of their powers, or
                                         (ii)   collecting or receiving any debt or other property of the
company, and from paying out or transferring any property of the company,
                                         except as permitted by the
Court;
                                (g)   an
order determining and enforcing the duty or liability of any present or former
director, officer, policyholder or shareholder
                                          (i)   to the company, or
                                         (ii)   for an obligation of the company;
                                (h)   an
order approving the payment, satisfaction or compromise of claims against the
company and the retention of assets for that purpose, and determining the
adequacy of provisions for the payment, discharge or transfer of any obligation
of the company, whether liquidated, unliquidated, future or contingent;
                                 (i)   with
the concurrence of the Minister, an order providing for the disposal or
destruction of the documents, records or registers of the company;
                                 (j)   on
the application of a creditor, an inspector or the liquidator, an order giving
directions on any matter arising in the liquidation;
                                (k)   after
notice has been given to all interested parties, an order relieving the
liquidator from any omission or default on such terms as the Court thinks fit
and confirming any act of the liquidator;
                                 (l)   subject
to sections 199, 200 and 202, an order approving any proposed, interim or final
distribution to shareholders, if any, or incorporators, in money or in
property;
                               (m)   an
order disposing of any property belonging to creditors, policyholders,
shareholders and incorporators who cannot be found;
                                (n)   on
the application of any director, officer, policyholder, shareholder,
incorporator or creditor or the liquidator,
                                          (i)   an order staying the liquidation proceedings on the terms and
conditions the Court thinks fit,
                                         (ii)   an order continuing or discontinuing the liquidation proceedings,
or
                                        (iii)   an order to the liquidator to restore to the company all of its
remaining property;
                                (o)   after
the liquidator has rendered the liquidator’s final account to the Court, an
order directing the company to apply to the Minister for a certificate
dissolving the company.
(2) The Court may appoint any person as liquidator
including a director, an officer or a shareholder of the provincial company
being liquidated or of any other provincial company.
1999 cI‑5.1 s193
Cessation of business
and powers
194(1) Where the Court makes an order for the
liquidation of a provincial company,
                                (a)   the
company continues in existence but must cease to carry on business, except the
business that is, in the opinion of the liquidator, required for an orderly
liquidation;
                                (b)   the
powers of the directors and shareholders, if any, cease to be vested in the
directors and shareholders and are vested in the liquidator, except as
specifically authorized by the Court.
(2) A liquidator may delegate any of the powers
vested by subsection (1)(b) to the directors, officers or shareholders, if any.
1999 cI‑5.1 s194
Vacancy in liquidator’s office
195 Where an order for the
liquidation of a provincial company has been made and the office of liquidator
is or becomes vacant, the property of the company is under the control of the
Court until the office of liquidator is filled.
1999 cI‑5.1 s195
Duties and powers of
liquidator
196(1) A liquidator of a provincial company must
                                (a)   forthwith
after being appointed give notice of the appointment to the Minister and to
each claimant and creditor of the provincial company known to the liquidator,
                                (b)   forthwith
after being appointed publish notice in The Alberta Gazette and once a week for
two consecutive weeks in a newspaper in general circulation in the place where
the head office of the provincial company is located, and take reasonable steps
to give notice in each province where the company transacted business within
the preceding 12 months, that
                                          (i)   any person indebted to the company is required to render an
account and to pay any amount owing to the liquidator at the time and place
specified in the notice,
                                         (ii)   any person possessing property of the company is required to
deliver it to the liquidator at the time and place specified in the notice, and
                                        (iii)   any person having a claim against the company, whether
liquidated, unliquidated, future or contingent, other than a policyholder
having an unliquidated claim, is required to present written particulars of the
claim to the liquidator not later than 60 days after the publication of the
notice in The Alberta Gazette,
                                (c)   take
the property of the provincial company into custody and control,
                                (d)   transfer
the remaining policies of the provincial company, or reinsure the remaining
risks undertaken by the company in accordance with Division 10,
                                (e)   open
and maintain a trust account for the money of the provincial company received
by the liquidator,
                                 (f)   keep
accounts of the money of the provincial company received and paid out by the
liquidator,
                                (g)   maintain
separate lists of each class of creditors, shareholders, policyholders and
other persons having claims against the provincial company,
                                (h)  Â
if at any time the liquidator determines that the provincial company is unable
to pay or adequately provide for the discharge of its obligations, apply to the
Court for directions,
                                 (i)   deliver
to the Court and to the Minister, at least once in every 12‑month period
after the liquidator’s appointment or more often, as the Court requires, the
annual return of the provincial company prepared in accordance with section 44
or prepared in a manner the liquidator thinks proper or as the Court requires,
and
                                 (j)   after
the final accounts are approved by the Court, distribute any remaining property
of the provincial company among the shareholders, if any, or incorporators,
according to their respective rights.
(2) A
liquidator may in respect of a liquidation of a provincial company
                                (a)   retain
professional advisors,
                                (b)   bring,
defend or take part in any civil, criminal or administrative action or
proceeding in the name of and on behalf of the company,
                                (c)   carry
on the business of the company as required for an orderly liquidation,
                                (d)   sell
any property of the company by public auction or private sale,
                                (e)   do
all acts and execute documents in the name of and on behalf of the company,
                                 (f)   with
the prior approval of the Court, borrow money on the security of the property
of the company,
                                (g)   settle
or compromise any claims by or against the company, and
                                (h)   do
all other things necessary for the liquidation of the company and the
distribution of its property.
(3) A liquidator must not purchase, directly or
indirectly, any part of the property of the provincial company without the
prior approval of the Court.
1999 cI‑5.1 s196
Reliance on statements
197 A liquidator is not liable if the
liquidator relies in good faith on
                                (a)   financial
statements of the provincial company represented to the liquidator by an
officer of the company, or in a written report of the auditor of the company,
as reflecting the financial condition of the company fairly, or
                                (b)   an opinion, a report or a statement of a
professional advisor retained by the liquidator.
1999 cI‑5.1 s197
Examination of others
198(1) Where a liquidator has reason to believe that
any property of the provincial company is in the possession or under the
control of a person or that a person has concealed, withheld or misappropriated
any such property, the liquidator may apply to the Court for an order requiring
that person to appear before the Court at the time and place designated in the
order to be examined.
(2) Where an examination conducted pursuant to
subsection (1) discloses that a person has concealed, withheld or
misappropriated any property of the provincial company, the Court may order
that person to restore the property or pay compensation to the liquidator.
1999 cI‑5.1 s198
Costs of liquidation
199 A liquidator must pay the
costs of liquidation out of the property of the provincial company and must pay
or make adequate provision for all claims against the company.
1999 cI‑5.1 s199
Final accounts
200(1) Within one year after the appointment of a
liquidator and after paying or making adequate provision for all claims against
the provincial company, the liquidator must apply to the Court
                                (a)   for
approval of the final accounts of the liquidator and for an order permitting
the distribution, in money or in kind, of the remaining property of the company
to its shareholders, if any, or to the incorporators, according to their
respective rights, or
                                (b)   for
an extension of time.
(2) If
a liquidator fails to make the application required by subsection (1), a
shareholder of the provincial company or, if there are no shareholders of the
company, an incorporator may apply to the Court for an order for the liquidator
to show cause why a final accounting and distribution should not be made.
(3) A
liquidator must give notice of the liquidator’s intention to make an
application under subsection (1) to the Minister, to each inspector and referee
appointed under section 193, to each shareholder of the provincial company or,
if there are no shareholders, to each incorporator and to any person who
provided a financial guarantee for the liquidation.
(4) The liquidator must publish the notice required
under subsection (3) in The Alberta Gazette and once a week for two consecutive
weeks in one or more newspapers in general circulation in each province or
territory in which the provincial company has transacted business within the
preceding 12 months or as otherwise directed by the Court.
1999 cI‑5.1 s200
Right to distribution of
money
201(1) If in the course of the liquidation of a
provincial company the shareholders resolve, or the liquidator proposes,
                                (a)   to
exchange all or substantially all of the remaining property of the company for
securities of another body corporate that are to be distributed to the
shareholders or to the incorporators, or
                                (b)   to
distribute all or part of the remaining property of the company to the
shareholders or to the incorporators in kind,
a shareholder or
incorporator may apply to the Court for an order requiring the distribution of
the remaining property of the company to be in money.
(2) On
an application under subsection (1), the Court may determine whether any
shareholder or incorporator of the provincial company is opposed to the
resolution or proposal and, if so, join that shareholder or incorporator as a
party and may order
                                (a)   that
all of the remaining property of the company is to be converted into and
distributed in money, or
                                (b)   that
the claim of any shareholder or incorporator applying under this section is to
be satisfied by a distribution in money.
(3) Where
an order is made by the Court under subsection (2)(b), the Court
                                (a)   must
fix a fair value on the share of the property of the provincial company
attributable to the shareholder or incorporator,
                                (b)   may
in its discretion appoint one or more appraisers to assist the Court in fixing
a fair value in accordance with clause (a),
                                (c)   must
render a final order against the provincial company in favour of the
shareholder or incorporator for the amount of the share of the property of the
company attributable to the shareholder or incorporator, and
                                (d)   must fix the time within which the
liquidator must pay the amount referred to in clause (c) to a shareholder or
incorporator, which payment in the case of a shareholder may occur only after
delivery of the shareholder’s shares to the liquidator.
1999 cI‑5.1 s201
Final order
202(1) If the Court approves the final accounts
rendered by a liquidator in respect of a provincial company, the Court must
make an order
                                (a)   directing
the custody or disposal of the documents, records and registers of the company,
and
                                (b)   discharging
the liquidator except in respect of the duty of a liquidator under subsection
(2).
(2) The liquidator must forthwith send a certified
copy of the order referred to in subsection (1) to the Minister.
1999 cI‑5.1 s202
Certificate of
dissolution
203(1) After the Minister receives the order under
section 202, the Lieutenant Governor in Council may issue a certificate of
dissolution that dissolves the provincial company.
(2) A provincial company is dissolved and ceases to
exist on the day stated in the certificate of dissolution.
1999 cI‑5.1 s203
General
Continuation of actions
204(1) Despite the dissolution of a provincial company
under this Division,
                                (a)   a
civil, criminal or administrative action or proceeding commenced by or against
the company before its dissolution may be continued as if the company had not
been dissolved,
                                (b)   a
civil, criminal or administrative action or proceeding may be brought against
the company within 2 years after its dissolution as if the company had not been
dissolved, and
                                (c)   any
property that would have been available to satisfy any judgment or order if the
company had not been dissolved remains available for that purpose.
(2) Service of a document on a provincial company
after its dissolution may be effected by serving the document on a person shown
as a director in the most recent notice of directors filed under this Act.
1999 cI‑5.1 s204
Limitations on liability
205(1) In this section, “shareholder� and
“incorporator� include the heirs and personal representatives of a shareholder
or incorporator.
(2) Despite
the dissolution of a provincial company, a shareholder or incorporator to whom
any of its property has been distributed is liable to any person claiming under
section 204(1) to the extent of the amount received by that shareholder or
incorporator on the distribution.
(3) An
action to enforce liability under subsection (2) must not be commenced after 2
years from the date of the dissolution of the provincial company.
(4) The
Court may order an action referred to in subsections (2) and (3) to be brought
against the persons who were shareholders or incorporators as a class, subject
to the conditions the Court thinks fit.
(5) If
the plaintiff establishes a claim in an action under subsection (4), the Court
may refer the proceedings to a referee or other officer of the Court, who may
                                (a)   add
as a party to the proceedings each person found by the plaintiff to have been a
shareholder or incorporator,
                                (b)   determine,
subject to subsection (2), the amount that each person who was a shareholder or
incorporator must contribute toward satisfaction of the plaintiff’s claim, and
                                (c)   direct payment of the amounts so determined.
1999 cI‑5.1 s205
Where creditor cannot be
found
206 If, on the dissolution of a
provincial company under this Division, the liquidator is unable to locate a
creditor, shareholder, incorporator or other claimant who is entitled to a distribution
of property, the liquidator may apply to the Court for directions.
1999 cI‑5.1 s206
Custody of records after
dissolution
207 A person who has been granted
custody of the documents, records and registers of a dissolved provincial
company must keep them available for production for 6 years following the date
of the dissolution of the company or until the expiration of a shorter period
ordered by the Court under section 202.
1999 cI‑5.1 s207
Revival
Revival
208(1) Any interested person may apply to the Minister
to revive, for a specified period, a dissolved provincial company, other than
one dissolved pursuant to an order of the Court.
(2) On
receipt of the application, the Minister may
                                (a)   issue
a certificate of revival that revives the provincial company for a specified
period, subject to any terms or conditions that the Minister considers
appropriate, or
                                (b)   direct
that an application be made to the Court under subsection (3).
(3) Any
interested person may apply to the Court for an order to revive, for a
specified period, a dissolved provincial company
                                (a)   where
the company was dissolved pursuant to an order of the Court, or
                                (b)   where
the Minister makes a direction under subsection (2)(b),
and the applicant must
give notice of the application to the Minister.
(4) The
Court may order that the provincial company be revived for a specified period
and that the revival is subject to any terms or conditions that it considers
appropriate.
(5) If
an order is made under subsection (4), the applicant must forthwith send a
certified copy of it to the Minister, and the Minister must issue a certificate
of revival that revives the company for the period specified in the order and
that sets out any terms or conditions specified in the order.
(6) On
the application of an interested party, the Minister, in the case of a
certificate of revival issued under subsection (2), or the Court, in the case
of a certificate of revival issued under subsection (5), may extend the period
of time for which a provincial company is revived, and the certificate of
revival must be amended to show the extended period.
(7) A
provincial company is revived on the date shown in the certificate of revival,
and subject to any order under this section and to rights acquired by any person
prior to the revival, the company is deemed to have continued in existence as
if it had not been dissolved.
(8) A provincial company that is revived under this
section is dissolved on the expiry of the period specified in its certificate
of revival.
1999 cI‑5.1 s208
Division 12
Dissolution and Revival of Mutual Provincial Companies
Insolvent mutual
provincial companies
209(1) This Division does not apply to a mutual
provincial company that is insolvent within the meaning of that term in the Winding‑up and Restructuring Act
(Canada).
(2) Any proceedings taken under this Division to
dissolve or to liquidate and dissolve a mutual provincial company must be
stayed if the company is at any time found to be insolvent within the meaning
of that term in the Winding‑up and
Restructuring Act (Canada).
1999 cI‑5.1 s209
Regulations
210 The Lieutenant Governor in
Council may make regulations respecting the winding‑up and dissolution of
mutual provincial companies and the revival of mutual provincial companies that
have been dissolved under the regulations.
1999 cI‑5.1 s210
Division 13
General
Names
211(1) Subject to the regulations, no provincial
company may have a name
                                (a)   that
is prohibited by the regulations or contains a word, expression or symbol that
is prohibited by the regulations,
                                (b)   that
is identical to the name of
                                          (i)   a body corporate, whether in existence or not, incorporated under
the laws of Alberta,
                                         (ii)   an extra‑provincial body corporate registered in Alberta,
or
                                        (iii)   a body corporate incorporated by or under an Act of the
Parliament of Canada,
                                (c)   that
is similar to the name of
                                          (i)   a body corporate incorporated under the laws of Alberta,
                                         (ii)   an extra‑provincial body corporate registered in Alberta,
or
                                        (iii)   a body corporate incorporated by or under an Act of the
Parliament of Canada,
                                         if the use of that name is
confusing or misleading, or
                                (d)   that
does not meet the prescribed requirements.
(2) Subject
to this Act and the regulations, a provincial company may have a name in an
English form, a French form, an English form and a French form or a combined
English and French form, and it may be legally designated by any such name.
(3) Where,
through inadvertence or otherwise, a provincial company obtains a name that
does not comply with this section, the Minister may issue a certificate
changing the name of the company.
(4) The Minister must publish a notice of a change
of name made under subsection (3) in The Alberta Gazette.
1999 cI‑5.1 s211
Regulations
212 The Lieutenant Governor in Council may
make regulations for the purposes of sections 21 and 211
                                (a)   prohibiting
names of insurers or any word, expression or symbol in the names of insurers;
                                (b)   respecting requirements for the names of
insurers.
1999 cI‑5.1 s212
Use of “insurance� in names
213 No entity incorporated or
formed by or under an enactment, other than a provincial company, may use the
words “insurance company� or “insurance corporation� or the French equivalents
of those words in its name.
1999 cI‑5.1 s213
Rights preserved
214 No amendment to the
incorporating instrument or bylaws of a provincial company affects an existing
cause of action or claim or liability to prosecution in favour of or against
the company or its directors or officers, or any civil, criminal or administrative
action or proceeding to which the company or any of its directors or officers
is a party.
1999 cI‑5.1 s214
Effective date of
certificates
215 A certificate issued under
this Subpart may be stated to be effective for as long as one year before the
date on which the certificate is issued.
1999 cI‑5.1 s215
Subpart 3
Head Office, Records and
Financial Statements
Head office
216(1) Every provincial company must have a head
office in Alberta.
(2) A provincial company that changes the address
of its head office must, before the change occurs, notify the Minister in
writing of the date of the change and of the new address.
1999 cI‑5.1 s216
Records
217(1) Subject to the regulations, every provincial
company must keep a copy of the following records at its head office:
                                (a)   its
instrument of incorporation and bylaws;
                                (b)   the
particulars of any terms or conditions imposed on its licence;
                                (c)   the
particulars of exceptions granted by the Minister that are applicable to the
company;
                                (d)   the
minutes of meetings and resolutions of participating policyholders or
shareholders;
                                (e)   the
name, address and date of appointment of the auditor;
                                 (f)   the
directors register
                                          (i)   containing the name and address, including any mailing address,
and a statement of citizenship of all persons who are or have been directors,
the date on which each became a director, the terms of the appointments and the
dates on which they ceased to be directors, and distinguishing, in the case of
a life company, between policyholders’
directors and shareholders’ directors,
                                         (ii)   containing a list of the bodies corporate of which each director
is an officer or director and the firms of which each director is a member,
                                        (iii)   containing the names of the directors who are also officers or employees
of the company or any of its affiliates and a list of the positions they occupy
in the company or affiliates, and
                                        (iv)   the name of each committee on which each director serves;
                                (g)   a
central securities register set up and maintained in accordance with section 49
of the Business Corporations Act as
incorporated by section 230 of this Act;
                                (h)   a
copy of the current financial statements of the company and each of its
subsidiaries;
                                 (i)   a
copy of the investment committee procedures and policies;
                                 (j)   minutes
of meetings and resolutions of the directors and any committee of the
directors;
                                (k)   adequate
accounting records
                                          (i)   that will enable the Minister to determine the company’s
financial position and whether it is in compliance with this Act and the
regulations,
                                         (ii)   that set out the company’s investments,
                                        (iii)   with accounts, in the form and manner determined by the Minister,
in respect of participating policies that are separate from accounts maintained
in respect of other policies, and
                                        (iv)   that set out the amount owing to it by each customer of or
claimant under a policy issued by it, and the nature of its liabilities to the
customer or claimant.
(2) Every
provincial company must keep at its head office any information or data
relating to the preparation and maintenance of the records referred to in
subsection (1).
(3) The
Minister may make regulations respecting the manner in which the records
referred to in subsection (1) are to be retained by a provincial company and
the length of time those records are to be retained.
(4) The
Minister may, subject to such terms and conditions as the Minister considers
appropriate, exempt a provincial company from keeping all or any of the records
referred to in subsection (1) in Alberta.
(5) A provincial company that is permitted to keep
records at a place outside Alberta under the authority of subsection (4) must
pay the reasonable transportation and living expenses of any examiner
authorized by the Minister to travel to that place to examine those records,
and the costs may be recovered from the company by the Minister in an action
for debt.
RSA 2000 cI‑3
s217;2003 cP‑6.5 s69
Access to records
218(1) Every provincial company must ensure that
                                (a)   its
records referred to in section 217(1)(a) to (i) are accessible to participating
policyholders, shareholders and creditors of the company and their agents
during normal business hours, and
                                (b)   the
participating policyholders, shareholders and creditors and their agents may examine those records, free of charge, or
have copies made of the records on payment of a reasonable fee.
(2) Records
of a provincial company referred to in section 217 must at all reasonable times
be open to inspection by the directors and their agents.
(3) Notwithstanding
anything in this section, a provincial company shall not disclose any
residential address kept by the provincial company under section 217.
RSA 2000 cI‑3
s218;2003 cP‑6.5 s69
Standards of financial
reporting
219(1) Where a provincial company provides its or its
subsidiaries’ audited financial statements to the Minister, policyholders,
shareholders or the public, the company must ensure that the statements are
prepared in accordance with the following:
                                (a)   generally
accepted accounting principles, including the accounting recommendations of the
Canadian Institute of Chartered Accountants set out in the Handbook published
by that Institute as amended from time to time;
                                (b)   generally
accepted auditing standards, including the auditing recommendations of the
Canadian Institute of Chartered Accountants set out in the Handbook published
by that Institute as amended from time to time;
                                (c)   subject
to subsection (2), generally accepted actuarial practices described in the
Standards of Practice of the Canadian Institute of Actuaries, as amended
from time to time;
                                (d)   any
modification of those principles, standards or practices established by the
Minister or any additional requirements, principles, standards or practices
established by the Minister.
(2) Subsection
(1)(c) does not apply to a provincial property and casualty company or its
subsidiaries if the actuary of the provincial company is not a Fellow in good
standing of the Canadian Institute of Actuaries but has been approved by the
Minister under section 395(2)(b).
(3) The Regulations
Act does not apply to the modifications or additional requirements,
principles, standards or practices established under subsection (1)(d).
1999 cI‑5.1 s219
Approval of annual
financial statements
220(1) No provincial company may publish, issue or
circulate copies of its annual financial statement unless the statement is
                                (a)   approved
by the directors of the company,
                                (b)   signed
in accordance with subsections (2) and (3), and
                                (c)   accompanied
with the report of its auditor.
(2) The
approval of the directors must be evidenced by the signature of
                                (a)   the
chief executive officer or, in the event of that officer’s absence or inability
to act, any other officer authorized by the directors to sign in place of the
chief executive officer, and
                                (b)   one
director if the signature required by clause (a) is that of a director, or 2
directors if the signature required by clause (a) is that of an officer who is
not a director.
(3) One of the directors referred to in subsection
(2)(b) must be a member of the company’s audit committee.
1999 cI‑5.1 s220
Distribution of
financial statements
221 Every provincial company must
send a copy of its annual audited financial statements to its participating
policyholders and shareholders not later than 21 days before each annual
meeting of participating policyholders and shareholders of the company.
1999 cI‑5.1 s221
List of shareholders
222(1) In this section, “basic list of shareholders�
of a provincial company means a list of the names of, the number and type of
shares owned by, and the address of, each shareholder and any known holder of
an option or right to acquire shares of the company, as shown in the records of
the company.
(2) Every
shareholder, participating policyholder or creditor of a provincial company or
their agents are entitled to a basic list of shareholders of the company.
(3) On
the request of a person who is entitled to a basic list of shareholders, the
provincial company must furnish a basic list of shareholders to that person
within 10 days after the company receives a statutory declaration referred to
in subsection (9) and payment of a reasonable fee.
(4) The
basic list of shareholders must be made up to a date not more than 10 days
before the date of receipt of the statutory declaration.
(5) A
person requesting a basic list of shareholders from a provincial company may
also request in the statutory declaration that the company provide a
supplemental list of shareholders.
(6) On
receiving a request for a supplemental list and payment of a reasonable fee,
the provincial company must furnish a supplemental list setting out any changes
from the basic list of shareholders for each business day from the date that
the basic list is made up to, to the date that the supplemental list is made up
to.
(7) If
the statutory declaration requests that the supplemental list be made up to the
date the basic list is provided, the supplemental list must be furnished within
10 days following the date that the basic list is provided.
(8) If
the statutory declaration requests that the supplemental list be made up to a
specified date after the basic list is provided, the supplemental list must be
furnished within 10 days following the specified date.
(9) A
statutory declaration must state
                                (a)   the
name and address for service of the applicant,
                                (b)   whether
a supplemental list is required and the date that the supplemental list is to
be made up to, and
                                (c)   that
the basic list of shareholders and any supplemental list obtained under this
section will not be used except as permitted under section 223.
(10) If the applicant is an entity, the statutory
declaration must be made by a director or officer of the entity or a person
acting in a similar capacity.
1999 cI‑5.1 s222
Use of list
223 A person who receives a basic list of
shareholders or a supplemental list of shareholders under section 222 may use
the list only in connection with
                                (a)   an
effort to influence the voting of the shareholders of the provincial company,
                                (b)   an
offer to acquire shares of the provincial company, or
                                (c)   any other matter relating to the affairs of
the provincial company.
1999 cI‑5.1 s223
Dealing in lists
224 No person may sell or purchase, offer for
sale or purchase or otherwise traffic in
                                (a)   a
basic list of shareholders or a supplemental list of shareholders referred to
in section 222, or
                                (b)   a list of holders of securities of a
provincial company.
1999 cI‑5.1 s224
Information to be given
to Minister by provincial companies
225 Every provincial company must provide to
the Minister
                                (a)   a
copy of any application and supporting documents it makes to be licensed in a
jurisdiction other than Alberta within 7 days after making the application and
a copy of the approval or refusal of the application within 7 days after the
receipt of the approval or refusal;
                                (b)   a copy of an order or direction by a court
or person in a jurisdiction other than Alberta in which the company is licensed
that affects the status of the company in the jurisdiction or that requires the
company to undergo special examinations or to do something or to refrain from
doing something.
1999 cI‑5.1 s225
Records as evidence
226 Every record that a provincial
company is, by this Act, required to keep or maintain is, in any suit or
proceeding against the provincial company or against a shareholder, proof, in
the absence of evidence to the contrary, of all facts purporting to be stated
in the record.
1999 cI‑5.1 s226
Certificate of company
as evidence
227(1) A certificate issued on behalf of a provincial
company stating any fact that is set out in the bylaws, in the minutes of the
meetings of the directors, a committee of directors or the shareholders, or in
a contract to which the company is a party, may be signed by a director, an
officer or a transfer agent of the company.
(2) When
introduced as evidence in any civil, criminal or administrative action or
proceeding,
                                (a)   a
fact stated in a certificate referred to in subsection (1),
                                (b)   a
certified extract from a securities register of a provincial company, or
                                (c)   a
certified copy of minutes or of an extract from minutes of a meeting of
directors, a committee of directors or the shareholders of a provincial
company,
is proof, in the
absence of evidence to the contrary, of the facts so certified without proof of
the signature or official character of the person appearing to have signed the
certificate.
(3) An entry in a securities register of, or a
security certificate issued by, a provincial company is proof, in the absence
of evidence to the contrary, that the person in whose name the security is
registered is the owner of the securities described in the register or in the
certificate.
1999 cI‑5.1 s227
Notices to
policyholders, shareholders, directors
228(1) A notice or document required by this Act, the
regulations or the bylaws of a provincial company to be given or sent to a
policyholder, shareholder or director of a provincial company may be delivered
personally to the policyholder, shareholder or director or sent by mail
addressed to
                                (a)   the
policyholder at the policyholder’s latest address as shown in the records of
the company,
                                (b)   the
shareholder at the shareholder’s latest address as shown in the records of the
company or its transfer agent, or
                                (c)   the
director at the director’s latest address as shown in the records of the
company or of the Minister.
(2) A
notice or document sent by mail in accordance with subsection (1) to a
policyholder, shareholder or director is deemed to be received by the
policyholder, shareholder or director at the time it would be delivered in the
ordinary course of mail unless there are reasonable grounds for believing that
the policyholder, shareholder or director did not receive the notice or
document at that time or at all.
(3) If
a provincial company sends a notice or document to a policyholder or
shareholder in accordance with subsection (1) and the notice or document is
returned on 3 consecutive occasions because the policyholder or shareholder
cannot be found, the company is not required to send any further notices or documents
to the policyholder or shareholder until the policyholder or shareholder
informs the company in writing of the policyholder’s or shareholder’s new
address.
(4) If there is a conflict between subsections (1)
to (3) and a statutory condition contained in a policy, the statutory condition
prevails.
1999 cI‑5.1 s228
Subpart 4
Capital Structure
Definition
229 In this Subpart, “security�
means, subject to Part 6 of the Business
Corporations Act as incorporated by section 230 of this Act, a share of any
class or series of shares or a debt obligation of a body corporate, and
includes a certificate evidencing such a share or debt obligation and includes
a warrant.
1999 cI‑5.1 s229
Application of Business
Corporations Act
230 Part 6 of the Business Corporations Act applies with
respect to a provincial company as if the company were a corporation within the
meaning of that Act, and a reference in that Part to a section of that Act,
other than to a section in that Part, is deemed to be a reference to the corresponding
section of this Act that deals with the same subject‑matter.
1999 cI‑5.1 s230
Requirements for Shares
Non‑par‑value
shares
231 Shares of a provincial company must
be in registered form and must be without nominal or par value.
1999 cI‑5.1 s231
Classes of shares
232(1) A provincial company, other than a mutual
provincial company, must have a class of shares designated as common shares.
(2) The
rights of the holders of common shares are equal in all respects and include
                                (a)   the
right to vote at all meetings of shareholders except where only holders of a
specified class of shares, or participating policyholders, are entitled to
vote,
                                (b)   the
right to receive dividends of the provincial company if declared on those
shares, and
                                (c)   the
right to receive the remaining property of the provincial company on
dissolution.
(3) No
provincial company may designate more than one class of its shares as common
shares or confer all of the characteristics of a common share described in
subsection (2) on more than one class of shares.
(4) A
provincial company may have classes of shares in addition to common shares, and
in that case the rights, privileges, restrictions and conditions attaching to
the shares of each class must be set out in the bylaws.
(5) Subject to section 236, if a provincial company
has more than one class of shares, the rights of the holders of the shares of a
class are equal in all respects.
1999 cI‑5.1 s232
Mutual provincial
companies - shares
233(1) A mutual provincial company must not issue any
share that confers on the shareholder the right to vote at any meeting of the
company.
(2) Subsection (1) does not apply in respect of any
share that confers on the shareholder the right to vote by reason of an event
that has occurred and is continuing or by reason of a condition that has been
fulfilled.
1999 cI‑5.1 s233
Issue of shares
234(1) Subject to this Act, the instrument of
incorporation and the bylaws, shares of a provincial company may be issued at
the times, to the persons and for the consideration determined by the
directors.
(2) Shares
issued by a provincial company are non‑assessable and the shareholders
are not liable to the company or to its creditors in respect of them.
(3) A
provincial company must not issue a share until the consideration for the share
is fully paid in money and received by the company.
(4) The
requirement in subsection (3) that the consideration be money does not apply
                                (a)   when
a share is issued as part of an amalgamation, or
                                (b)   when the Minister has given prior approval
to the consideration’s being other than money.
1999 cI‑5.1 s234
Capital account
235(1) A provincial company must maintain a separate
capital account for each class and series of shares it issues.
(2) Unless
the Minister approves otherwise, a provincial company must add to the
appropriate capital account in respect of any shares it issues the full amount
of the consideration it receives for the shares.
(3) On
the issue of a share, a provincial company must not add to a capital account in
respect of the share an amount greater than the amount referred to in
subsection (2).
(4) If
a provincial company proposes to add any amount to a capital account it
maintains in respect of a class or series of shares and
                                (a)   the
amount to be added was not received by the company as consideration for the
issue of shares, and
                                (b)   the
company has issued outstanding shares of more than one class or series,
the addition to the
capital account must be approved by special resolution unless all the issued
and outstanding shares are shares of not more than 2 classes of convertible
shares referred to in section 250(5).
(5) Where, in the case of a proposed addition of an
amount to a capital account in a situation where a special resolution is
required under subsection (4), a class or series of shares of a provincial
company would be affected differently from how any other class or series of
shares of the company would be affected by such action, the holders of shares
of the differently affected class or series are entitled to vote separately as
a class or series, as the case may be, on the proposal to take the action,
whether or not such shares otherwise carry the right to vote.
1999 cI‑5.1 s235
Shares in series
236(1) Subject to the instrument of incorporation and
the bylaws, the directors of a provincial company may authorize the issue of
any class of shares, other than common shares, in one or more series, and they
may fix the number of shares in, and determine the designation, rights,
privileges, restrictions and conditions attaching to the shares of, each
series.
(2) If
any cumulative dividends or amounts payable on return of capital in respect of
a series of shares are not paid in full, the shares of all series of the same
class participate ratably in respect of accumulated dividends and return of
capital.
(3) No
rights, privileges, restrictions or conditions attached to a series of shares
authorized under this section confer on shares of a series
                                (a)   greater
voting rights than are attached to shares of any other series in the same class
that are then outstanding, or
                                (b)   a
priority in respect of dividends or return of capital over shares of any other
series in the same class that are then outstanding.
(4) Subsection (3) does not apply to a right or
privilege to exchange a share or shares for, or to convert a share or shares
into, a share or shares of another class.
1999 cI‑5.1 s236
Shareholder’s pre‑emptive right
237(1) For the purposes of this section, a pre‑emptive
right is a right attached to a class of shares in which no shares of that class
may be issued unless the shares to be issued have first been offered to each
shareholder holding shares of that class
                                (a)   in
an amount that is in proportion to their holdings of the shares of that class,
and
                                (b)   at
a price and on the same terms as those shares are to be offered to others.
(2) The
shares of a provincial company do not have a pre‑emptive right unless the
instrument of incorporation or the bylaws provide for a pre‑emptive
right.
(3) A
pre‑emptive right does not apply in respect of shares to be issued
                                (a)   for
a consideration other than money,
                                (b)   as
a share dividend, or
                                (c)   pursuant to the exercise of conversion
privileges, options or rights previously granted by the provincial company.
1999 cI‑5.1 s237
Changes to Shares
Changing shares
238(1) The directors of a provincial company may make,
amend or repeal any bylaws
                                (a)   to
change the maximum number, if any, of shares of any class that the company is
authorized to issue,
                                (b)   to
create new classes of shares,
                                (c)   to
change the designation of any or all of the company’s shares and add, change or
remove any rights, privileges, restrictions and conditions, including rights to
accrued dividends, in respect of any or all of the company’s shares, whether
issued or unissued,
                                (d)   to
change the shares of any class or series, whether issued or unissued, into a
different number of shares of the same class or series or into the same or a
different number of shares of other classes or series,
                                (e)   to
divide a class of shares, whether issued or unissued, into series and fix the
maximum number of shares, if any, in each series and the rights, privileges,
restrictions and conditions attached to the shares in each series,
                                 (f)   to
authorize the directors to divide any class of unissued shares into series and
fix the maximum number of shares, if any, in each series and the rights,
privileges, restrictions and conditions attached to the shares in each series,
                                (g)   to
authorize the directors to change the rights, privileges, restrictions and
conditions attached to unissued shares of any series, and
                                (h)   to
revoke, diminish or enlarge any authority conferred under clause (f) or (g).
(2) The
directors must submit a bylaw, or an amendment to or a repeal of a bylaw, that
is made under subsection (1) to the participating policyholders and
shareholders, and the policyholders and shareholders may, by special
resolution, confirm, amend or reject the bylaw, amendment or repeal.
(3) A
bylaw, or an amendment to or a repeal of a bylaw, made under subsection (1) is
not effective until it is
                                (a)   confirmed
or confirmed as amended by the policyholders and shareholders under subsection
(2), and
                                (b)   approved
by the Minister.
(4) Where a special resolution referred to in
subsection (2) so states, the directors may, before it is submitted to the
Minister for approval and without further approval of the policyholders or
shareholders, revoke the special resolution.
1999 cI‑5.1 s238
Class vote
239(1) The holders of shares of a class or, subject to
subsection (2), of a series are, unless the bylaws otherwise provide in the
case of an amendment to the bylaws referred to in clause (a), (b) or (e),
entitled to vote separately as a class or series on a proposal to amend the
bylaws
                                (a)   to
increase or decrease any maximum number of authorized shares of that class, or
increase any maximum number of authorized shares of a class having rights or
privileges equal or superior to the shares of that class,
                                (b)   to
effect an exchange, reclassification or cancellation of all or part of the
shares of that class,
                                (c)   to
add, change or remove the rights, privileges, restrictions or conditions
attached to the shares of that class and, without limiting the generality of
the foregoing,
                                          (i)   to remove or change prejudicially rights to accrued dividends or
rights to cumulative dividends,
                                         (ii)   to add, remove or change prejudicially redemption rights,
                                        (iii)   to reduce or remove a dividend preference or a liquidation
preference, or
                                        (iv)   to add, remove or change prejudicially conversion privileges,
options, voting, transfer or pre‑emptive rights, rights to acquire
securities of the provincial company or sinking fund provisions,
                                (d)   to
increase the rights or privileges of any class of shares having rights or
privileges equal or superior to the shares of that class,
                                (e)   to
create a new class of shares equal or superior to the shares of that class,
                                 (f)   to
make any class of shares having rights or privileges inferior to the shares of
that class equal or superior to the shares of that class, or
                                (g)   to
effect an exchange or create a right of exchange of all or part of the shares
of another class into the shares of that class.
(2) The
holders of a series of shares of a class are entitled to vote separately as a
series under subsection (1) if that series would be affected by an addition or
amendment to the bylaws differently from how other shares of the same class
would be affected.
(3) Subsections
(1) and (2) apply whether or not the shares of a class otherwise carry the
right to vote.
(4) A proposed addition or amendment to the bylaws
referred to in subsection (1) is adopted when the holders of the shares of each
class or series entitled to vote separately on the addition or amendment as a
class or series and the participating policyholders have approved the addition
or amendment by a special resolution.
1999 cI‑5.1 s239
Proposal to amend
240(1) Subject to subsection (2), a director or a
participating policyholder or shareholder of a provincial company may, in
accordance with sections 274 and 275, make a proposal to make, amend or repeal
the bylaws of the company referred to in section 238(1).
(2) If a proposal is made to make, amend or repeal
bylaws of a provincial company to effect any of the changes referred to in
section 238(1), notice of the meeting of policyholders or shareholders at which
the proposal is to be considered must set out the proposal.
1999 cI‑5.1 s240
Restriction on
subordinated indebtedness
241(1) A provincial company must not issue
subordinated indebtedness unless the subordinated indebtedness is fully paid
for in money or, with the approval of the Minister, in property.
(2) A
person must not in any prospectus, advertisement, correspondence or literature
relating to any subordinated indebtedness issued or to be issued by a
provincial company refer to the subordinated indebtedness otherwise than as
subordinated indebtedness.
(3) When issuing subordinated indebtedness, a
provincial company may provide that any aspect of the subordinated indebtedness
relating to money or involving the payment of or the liability to pay money in
relation to the subordinated indebtedness be in a currency other than that of
Canada, including, without restricting the generality of the foregoing, the
payment of any interest on the subordinated indebtedness.
1999 cI‑5.1 s241
Other Matters
Conversion privileges,
options and rights
242(1) A provincial company may issue certificates,
warrants or other evidences of conversion privileges or options or rights to
acquire securities of the company and must set out the conditions to which the
conversion privileges, options or rights are subject
                                (a)   in
the certificates, warrants or other evidences, or
                                (b)   in
certificates evidencing the securities to which the conversion privileges,
options or rights are attached.
(2) Conversion
privileges and options or rights to purchase securities of a provincial company
may be made transferable or non‑transferable, and options and rights to
purchase may be made separable or inseparable from any securities to which they
are attached.
(3) If a provincial company has granted privileges
to convert any securities issued by the company into shares, or into shares of
another class or series, or has issued or granted options or rights to acquire
shares, the company must reserve and continue to reserve sufficient authorized
shares to meet the exercise of those conversion privileges, options and rights.
1999 cI‑5.1 s242
Prohibited shareholdings
243(1) A provincial company
                                (a)   must
not hold shares in itself or in its holding body corporate, and
                                (b)   must
not permit any of its subsidiaries to hold shares in the company or in the
holding body corporate of the company
except in accordance
with this section and sections 244 to 248 unless the Minister consents to the
holding.
(2) A
provincial company may in the capacity of personal representative hold shares
in itself or in its holding body corporate so long as the company or the
holding body corporate or a subsidiary of either of them does not have a
beneficial interest in the shares.
(3) A
provincial company may hold shares in itself or in its holding body corporate
by way of security for the purposes of a transaction entered into by it in the
ordinary course of its business.
(4) A
provincial company holding shares in itself or in its holding body corporate
must not vote or permit those shares to be voted unless the company
                                (a)   holds
the shares in the capacity of personal representative, and
                                (b)   has complied with section 307.
1999 cI‑5.1 s243
Restrictions on
acquisition of shares
244(1) Subject to this section, sections 256 to 266
apply to a purchase, acquisition or redemption for cancellation of voting
shares by a provincial company under section 245, 246 or 247 if the purchase,
acquisition or redemption of the voting shares
                                (a)   would
cause a person to have a significant interest in those voting shares or would
increase the significant interest of a person in those voting shares, or
                                (b)   would
cause the combined holdings of a person and a person related to that person to
amount to a significant interest in those voting shares or would increase the
significant interest of a person and a related person in those voting shares.
(2) Despite
subsection (1), in the case of a purchase, acquisition or redemption of shares
referred to in subsection (1),
                                (a)   section
259 does not apply, and
                                (b)   the provincial company must make the
application referred to in section 262(1).
1999 cI‑5.1 s244
Acquisition of own
shares
245(1) Subject to subsection (2) and to its bylaws,
the directors of a provincial company may authorize the company to purchase or
otherwise acquire shares issued by it.
(2) The
directors of a provincial company must not authorize the company to make any
payment to purchase or otherwise acquire shares issued by it if there are
reasonable grounds for believing that
                                (a)   the
company is, or after the payment would be, unable to pay its liabilities as
they become due, or
                                (b)   the
realizable value of the company’s assets after the payment would be less than
the aggregate of its liabilities and the book value of all its shares.
(3) A
provincial company that is not a reporting issuer must, within 30 days after
the purchase of any of its issued shares, notify its shareholders
                                (a)   of
the number of shares it has purchased,
                                (b)   of
the names of the shareholders from whom it has purchased the shares,
                                (c)   of
the price paid for the shares, and
                                (d)   of
the balance, if any, remaining due to the shareholders from whom it has
purchased the shares.
(4) A shareholder of a provincial company other
than a reporting issuer is entitled on request and without charge to a copy of
the agreement between the company and any of its other shareholders under which
the company has agreed to purchase, or has purchased, any of its own shares.
1999 cI‑5.1 s245
Alternative acquisition
of own shares
246(1) Subject to subsection (2) and to its bylaws,
the directors of a provincial company may authorize the company to purchase or
otherwise acquire shares issued by it
                                (a)   to
settle or compromise a debt or claim asserted by or against the company,
                                (b)   to
eliminate fractional shares, or
                                (c)   to
fulfil the terms of a non‑assignable agreement under which the company
has an option or is obliged to purchase shares owned by a director, officer or
employee of the company.
(2) Despite
section 245(2), a provincial company may purchase or otherwise acquire shares
issued by it to comply with an order under section 776.
(3) The
directors of a provincial company must not authorize the company to make any
payment to purchase or acquire under subsection (1) shares issued by it if
there are reasonable grounds for believing that
                                (a)   the
company is, or after the payment would be, unable to pay its liabilities as
they become due,
                                (b)   the
realizable value of the company’s assets after the payment would be less than
the aggregate of
                                          (i)   its liabilities, and
                                         (ii)   the amount that would be required to pay the holders of shares
who have a right to be paid, on a redemption or in a liquidation, prior to the
holders of the shares to be purchased or acquired,
                                    or
                                (c)   the purchase or acquisition would cause the
company to be in contravention of this Act or the regulations.
1999 cI‑5.1 s246
Redemption of shares
247(1) Subject to subsection (2) and to its bylaws,
the directors of a provincial company may authorize the company to purchase or
redeem any redeemable shares issued by it at prices not exceeding the
redemption price calculated according to a formula stated in the bylaws.
(2) The
directors of a provincial company must not authorize the company to make any
payment to purchase or redeem any redeemable shares issued by it if there are
reasonable grounds for believing that
                                (a)   the
company is, or after the payment would be, unable to pay its liabilities as
they become due,
                                (b)   the
realizable value of the company’s assets after the payment would be less than
the aggregate of
                                          (i)   its liabilities, and
                                         (ii)   the amount that would be required to pay the holders of shares
who have a right to be paid, on a redemption or in a liquidation, ratably with
or prior to the holders of the shares to be purchased or redeemed,
                                    or
                                (c)   the redemption would cause the company to be
in contravention of this Act or the regulations.
1999 cI‑5.1 s247
Donated and escrowed
shares
248 A provincial company may accept from any
shareholder a share of the company
                                (a)   that
is surrendered to it as a gift, or
                                (b)   that has been held in escrow pursuant to an
escrow agreement required by the Executive Director under the Securities Act and that is surrendered
pursuant to that agreement.
1999 cI‑5.1 s248
Reduction of share
capital
249(1) Subject to subsection (3), its instrument of
incorporation and its bylaws, a provincial company, by special resolution and
with the approval of the Minister, may reduce its share capital for any
purpose.
(2) Where
a class or series of shares of a provincial company would be affected by a
reduction of share capital under subsection (1) differently from how any other
class or series of shares of the company would be affected by such action, the
holders of shares of the differently affected class or series are entitled to
vote separately as a class or series, as the case may be, on the proposal to
take the action, whether or not the shares otherwise carry the right to vote.
(3) A
provincial company must not reduce its share capital, other than for the
purpose of declaring it to be reduced by an amount that is not represented by
realizable assets, if there are reasonable grounds for believing that
                                (a)   the
company is, or after the reduction would be, unable to pay its liabilities as
they become due, or
                                (b)   the
reduction would cause the company to be in contravention of this Act or the
regulations.
(4) A
special resolution under this section must specify the capital account or
accounts from which the reduction of share capital effected by the special
resolution will be made.
(5) An
application for the Minister’s approval of a special resolution must contain
statements showing
                                (a)   the
number of the provincial company’s shares issued and outstanding,
                                (b)   the
results of the voting by class of shares of the company,
                                (c)   the
company’s assets and liabilities, and
                                (d)   the
reason why the company seeks the reduction of share capital.
(6) A
shareholder, creditor or participating policyholder of a provincial company may
apply to the Court for an order compelling another shareholder or another
recipient
                                (a)   to
pay to the company an amount equal to any liability of that other shareholder
that was extinguished or reduced in contravention of this section, or
                                (b)   to
pay or deliver to the company any money or property that was paid or
distributed to that other shareholder or recipient as a consequence of a
reduction of share capital made in contravention of this section.
(7) A
proceeding to enforce a liability imposed by this section must not be commenced
after 2 years from the date of the action complained of.
(8) This section does not affect any liability that
arises under section 360.
1999 cI‑5.1 s249
Adjustment of capital
account
250(1) On a purchase, redemption or other acquisition
by a provincial company under section 245, 246, 247, 254 or 776(3)(e) of shares
or fractions of shares issued by it, the company must deduct from the capital
account maintained for the class or series of shares of which the shares
purchased, redeemed or otherwise acquired form a part, an amount equal to the
result obtained by multiplying the book value of the shares of that class or
series by the number of shares or fractions of shares of that class or series
purchased, redeemed or otherwise acquired, divided by the number of issued
shares of that class or series immediately before the purchase, redemption or
other acquisition.
(2) A
provincial company must deduct the amount of a payment made by the company to a
shareholder under section 776 from the capital account maintained for the class
or series of shares in respect of which the payment was made.
(3) A
provincial company must adjust its capital account or accounts in accordance
with any special resolution referred to in section 249(4).
(4) On
a conversion or change of issued shares of a provincial company into shares of
another class or series, the company must
                                (a)   deduct
from the capital account maintained for the class or series of shares converted
or changed an amount equal to the result obtained by multiplying the book value
of the shares of that class or series by the number of shares of that class or
series converted or changed, divided by the number of issued shares of that
class or series immediately before the conversion or change, and
                                (b)   add
the result obtained under clause (a) and any additional consideration received
pursuant to the conversion or change to the capital account maintained or to be
maintained for the class or series of shares into which the shares have been
converted or changed.
(5) For
the purposes of subsection (4), where a provincial company issues 2 classes or
series of shares and there is attached to each class or series a right to
convert a share of one class or series into a share of the other class or
series, the amount to be attributed to a share in either class or series is the
amount obtained when the sum of the book value of both classes or series of
shares is divided by the number of issued shares of both classes or series of
shares immediately before the conversion.
(6) Shares
or fractions of shares issued by a provincial company and purchased, redeemed
or otherwise acquired by it must be cancelled or restored to the status of
authorized but unissued shares.
(7) For
the purposes of this section, a provincial company holding shares in itself as
permitted by section 243(2) or (3) is deemed not to have purchased, redeemed or
otherwise acquired those shares.
(8) Where shares of a class or series are converted
or changed into the same or another number of shares of another class or
series, those shares become the same in all respects as the shares of the class
or series into which they are converted or changed.
1999 cI‑5.1 s250
Enforceability of
contract to purchase shares
251(1) A contract with a provincial company providing
for the purchase by it of its own shares is specifically enforceable against
the company, except to the extent that it cannot perform the contract without
contravening section 245 or 246.
(2) In
any action brought on a contract referred to in subsection (1), the provincial
company has the burden of proving that performance of the contract is prevented
by section 245 or 246.
(3) Until
the provincial company has fully performed a contract referred to in subsection
(1), the other party to the contract retains the status of a claimant and is
entitled
                                (a)   to
be paid as soon as the company is lawfully able to perform the contract, or
                                (b)   in a liquidation, to be ranked subordinate
to the rights of policyholders, creditors, holders of subordinated notes and
any class of shareholders whose rights were in priority to the rights given to
the class of shares that the other party contracted to sell to the company, but
in priority to the rights of other shareholders.
1999 cI‑5.1 s251
Commission on sale of
shares
252 The directors of a provincial company may
authorize the company to pay a reasonable commission to any person in
consideration of the person’s
                                (a)   purchasing
or agreeing to purchase shares of the company from it or from any other person,
or
                                (b)   procuring or agreeing to procure purchasers
for any such shares.
1999 cI‑5.1 s252
Payment of dividend
253(1) The directors of a provincial company may
declare, and a provincial company may pay, a dividend by issuing fully paid
shares of the company and, subject to subsection (3), a provincial company may
pay a dividend in money or property.
(2) If
a provincial company issues shares of the company in payment of a dividend, it
must add to the capital account for the shares of the class or series issued
the declared amount of the dividend, stated as an amount of money.
(3) The
directors must not declare and a provincial company must not pay a dividend if
there are reasonable grounds for believing that
                                (a)   the
company is, or after the payment would be, unable to pay its liabilities as
they become due, or
                                (b)   the payment would cause the company to be in
contravention of this Act or the regulations.
1999 cI‑5.1 s253
Lien on share
254(1) The bylaws of a provincial company may provide
that the company has a lien on a share registered in the name of a shareholder
or the shareholder’s personal representative for a debt of that shareholder to
the company.
(2) A provincial company may enforce a lien
referred to in subsection (1) in accordance with its bylaws.
1999 cI‑5.1 s254
Restrictions on issue,
transfer
255 A provincial company must not
impose restrictions on the issue, transfer or ownership of shares of any class
or series except to the extent that it is authorized to do so by its instrument
of incorporation or this Act.
1999 cI‑5.1 s255
Interpretation
256 For the purposes of this section, section
244 and sections 257 to 265, a person is deemed to be related to
                                (a)   every
body corporate the person controls and every affiliate of such a body
corporate,
                                (b)   every
partner of the person,
                                (c)   every
trust or estate in which the person has a substantial beneficial interest or in
respect of which the person serves as trustee or in a similar capacity,
                                (d)   the
spouse or adult interdependent partner of the person,
                                (e)   every
relative of the person, or of the person’s spouse or adult interdependent
partner, who resides in the same home as the person, and
                                 (f)   every other person the Minister considers is
acting in concert with the person to acquire and control voting shares of a
provincial company and that the Minister designates by order as a related
person.
RSA 2000 cI‑3
s256;2002 cA‑4.5 s45
Constraints on ownership
257(1) No person may, without the approval of the
Minister, purchase or otherwise acquire any share of a provincial company or
purchase or otherwise acquire control of any entity that holds any share of a
provincial company if
                                (a)   the
acquisition would cause the person to have a significant interest in any class
of shares of the company, or
                                (b)   where
the person has a significant interest in a class of shares of the company, the
acquisition would increase the significant interest of the person in that class
of shares.
(2) No
person and no person related to that person may, without the approval of the
Minister, purchase or otherwise acquire any share of a provincial company or
purchase or otherwise acquire control of any entity that holds any share of a
provincial company if
                                (a)   the
acquisition would cause the combined holdings of the person and the related
person to amount to a significant interest in any class of shares of the
company, or
                                (b)   where
the combined holdings of the person and the related person amount to a
significant interest in a class of shares of the company, the acquisition would
increase the significant interest of the person and the related person in that
class of shares.
(3) Unless
the acquisition of the share has been approved by the Minister, no provincial
company may record in its securities register a transfer or issue of any share
of the company to any person if
                                (a)   the
transfer or issue of the share would cause the person to have a significant
interest in any class of shares of the company, or
                                (b)   where
the person has a significant interest in a class of shares of the company, the
transfer or issue of the share would increase the significant interest of the
person in that class of shares.
(4) Unless
the acquisition of the share has been approved by the Minister, no provincial
company may record in its securities register a transfer or issue of any share
of the company to any person or any person related to that person if
                                (a)   the
transfer or issue of the share would cause the combined holdings of the person
and the related person to amount to a significant interest in any class of
shares of the company, or
                                (b)   where
the combined holdings of the person and the related person amount to a
significant interest in a class of shares of the company, the transfer or issue
of the share would increase the significant interest of the person and the
related person in that class of shares.
(5) This
section does not apply to any class of non‑voting shares of a provincial
company that do not amount to more than 10% of the equity of the company.
(6) If the Minister’s approval is required under
subsection (1), (2), (3) or (4) before a provincial company may record in its
securities register a transfer or issue of a share of the company to a person,
the person must not exercise any voting rights attached to those shares until
the Minister’s approval is obtained.
1999 cI‑5.1 s257
Previous approval
obtained
258(1) Where the Minister’s approval is given under
section 257 with respect to a person or other persons related to that person,
no approval under section 257 is required with respect to those persons in
respect of a subsequent transfer or issue of voting shares unless, as a result
of the transfer or issue, the shareholdings or beneficial ownership of those
persons would undergo an increase of more than 5% from the shareholdings or
beneficial ownership calculated immediately after the previous approval was
given.
(2) The
exception set out in subsection (1) does not apply
                                (a)   to
a transfer or issue of shares that would result in a change of control of the
provincial company, or
                                (b)   where, since the previous approval was
given, the shareholdings or beneficial ownership of the person and other
persons related to that person have decreased by more than 5% from the
shareholdings or beneficial ownership calculated immediately after the previous
approval was given.
1999 cI‑5.1 s258
Shares to underwriter
259 The approval of the Minister
under section 257 is not required in respect of a transfer or issue of shares
to an underwriter, within the meaning of that term in the Securities Act, who receives them in that capacity.
1999 cI‑5.1 s259
Exception for small
holdings
260 Despite section 257(3) and (4), where, as
a result of a transfer or issue of shares of a class of shares of a provincial
company to a person, the total number of shares of that class registered in the
securities register of the company in the name of the person
                                (a)   would
not exceed 5000, and
                                (b)   would
not exceed 0.1%Â of the outstanding
shares of that class,
the company is entitled to act as though no person is
acquiring or increasing a significant interest in that class of shares of the
company as a result of that issue or transfer of shares unless it has actual
knowledge that the person is acquiring or increasing a significant interest in that
class of shares.
1999 cI‑5.1 s260
Increasing large
holdings
261 The approval of the Minister
under section 257 is not required where a person who holds 95% or more of the
total rights attached to all of the outstanding voting shares of a company
purchases or otherwise acquires additional shares of the company.
1999 cI‑5.1 s261
Minister’s approval
262(1) Where an approval is required under section
257,
                                (a)   the
person to whom the shares are to be transferred or issued, or
                                (b)   where
the person referred to in clause (a) will not be the beneficial owner of the
shares, that person and the beneficial owner jointly,
must apply for the
approval and must provide the Minister with any information the Minister
requires in support of the application.
(2) On
an application under subsection (1), the Minister must take into account all matters that the Minister considers
relevant to the application, including
                                (a)   whether
any of the holders or beneficial owners to whom the approval relates
                                          (i)   is or has been bankrupt,
                                         (ii)   has been convicted of a criminal offence, an offence under this
Act or an offence under the Securities
Act or comparable legislation of another jurisdiction in Canada,
                                        (iii)   is or has been subject to a cease trading order under the Securities Act or comparable legislation
of another jurisdiction in Canada,
                                        (iv)   is the subject of a special examination under section 757,
                                         (v)   is, in the Minister’s opinion, contravening any provision of this
Act or the regulations or of any comparable legislation of another jurisdiction
or of any undertaking given to the Minister, or
                                        (vi)   has failed to provide the information required under subsection
(1);
                                (b)   the
nature and sufficiency of the financial resources of the holders or beneficial
owners to whom the application for approval relates as a source of continuing
financial support for the provincial company;
                                (c)   where
the transfer or issue would result in a change in control of the provincial
company, the soundness and feasibility of plans of the holders or beneficial
owners to whom application for the approval relates for the future conduct and
development of the business of the company;
                                (d)   the
business record and experience of the holders or beneficial owners to whom the
application for approval relates;
                                (e)   whether
the provincial company will be operated responsibly by persons who are fit as
to character and are competent for that purpose;
                                 (f)   the
best interests of the financial system in Alberta.
(3) The approval of the Minister under this section
takes effect on the date set out in the approval, and the effective date may be
a date before the date the approval is given.
1999 cI‑5.1 s262
Minister’s right to information
263(1) The Minister may in writing direct a provincial
company to obtain from a person in whose name a share is registered in the
securities register of the company or who is the beneficial owner of a share of
the company a declaration containing any or all of the following information:
                                (a)   information
concerning the ownership or beneficial ownership of the share;
                                (b)   information
as to whether the share is held or beneficially owned by a person who is
related to that person, and the name of the related person where applicable;
                                (c)   information
as to the place in which the shareholder and any person for whose use or
benefit the share is held are ordinarily resident;
                                (d)   information
concerning the ownership or beneficial ownership of the shares of a holding
body corporate;
                                (e)   information
concerning any other matters specified by the Minister.
(2) The
directors of a provincial company that is the subject of a direction under
subsection (1) must ensure that the company forthwith complies with the
direction.
(3) A provincial company that is the subject of a
direction under subsection (1) may request a person who has possession of or
access to the information required to provide a declaration containing the
information to the Minister, and that person must forthwith comply with the
request.
1999 cI‑5.1 s263
Exemption
264(1) The Minister may by order exempt any provincial
company or other person from the application of section 257 in whole or in part
and on any terms and conditions set out in the order.
(2) The Regulations
Act does not apply to an order under subsection (1).
1999 cI‑5.1 s264
Bylaws re shareholder
information
265(1) The directors of a provincial company may make
bylaws
                                (a)   requiring
any person holding any voting share of the company to submit written
declarations
                                          (i)   with respect to the ownership and beneficial ownership of a share
of the company or of a holding body corporate,
                                         (ii)   with respect to the place in which the shareholder and any person
for whose use or benefit the share is held are ordinarily resident,
                                        (iii)   as to whether the shareholder is related to other persons, and
                                        (iv)   with respect to any other matters the directors consider relevant
for the purposes of sections 256 to 263,
                                (b)   prescribing
the times at which and the manner in which any declarations required under
clause (a) are to be submitted, and
                                (c)   requiring
any person desiring to have a transfer of a share to the person recorded in the
securities register of the company to submit a declaration referred to in
clause (a) as if the person were a shareholder.
(2) Where under any bylaw made under subsection (1)
a declaration is required to be submitted by any shareholder or person in
respect of the transfer of any share, the directors may refuse to allow the
entry of the transfer of the share in the securities register of the provincial
company until the required declaration has been submitted.
1999 cI‑5.1 s265
Reliance on information
266 A director of a provincial company and
any other person acting as proxy for a shareholder of the company may rely on a
statement made in a declaration made pursuant to a bylaw under section 265(1)
and on their own knowledge of the circumstances for the purposes of determining
                                (a)   the
residence of a person,
                                (b)   who
controls a body corporate, or
                                (c)   any
other circumstances relevant to the performance of their duties under sections
256 to 263,
and the director or other person is not liable in any
action for anything done or omitted by the director or other person in good
faith in reliance on that statement or that knowledge.
1999 cI‑5.1 s266
Subpart 5
Participating Policyholders
and Shareholders
Division 1
Meetings and Voting
Place of meetings
267(1) Meetings of participating policyholders or
shareholders of a provincial company must be held at the place in Alberta
provided for in the bylaws of the company or, in the absence of any such
provision, at the place in Alberta that the directors determine.
(2) The Minister may, on application, exempt a
provincial company from holding a meeting of participating policyholders or
shareholders in Alberta.
1999 cI‑5.1 s267
Calling meetings
268 The directors of a provincial company
                                (a)   must,
after the meeting called pursuant to section 133, call the first annual meeting
of participating policyholders and shareholders of the provincial company,
which meeting must be held not later than 6 months after the end of the first
financial year of the company,
                                (b)   must
subsequently call annual meetings of participating policyholders and
shareholders, to be held not later than 6 months after the end of each
financial year, and
                                (c)   may at any time call a special meeting of
participating policyholders or shareholders.
1999 cI‑5.1 s268
Record date
269(1) For the purpose of determining
                                (a)   shareholders
entitled to receive payment of a dividend,
                                (b)   participating
policyholders or shareholders entitled to participate in a liquidation
distribution,
                                (c)   who
is a shareholder for any other purpose except the right to receive notice of,
or to vote at, a meeting, or
                                (d)   who
is a policyholder for any other purpose except
                                          (i)   the right to receive notice of, or to vote at, a meeting,
                                         (ii)   the right to receive payment of a policy dividend or bonus, and
                                        (iii)   any purpose for which the determination of policyholders is
governed by contract,
the directors may fix
in advance a date as the record date for the determination of policyholders or
shareholders, but the record date so fixed must not precede the particular
action to be taken by more than 50 days.
(2) If
no record date is fixed under subsection (1) for the determination of
policyholders or shareholders for any purpose for which a record date could
have been fixed under that subsection, the record date for the determination of
policyholders or shareholders for that purpose is the date on which the
directors pass the resolution relating to that purpose.
(3) For
the purpose of determining participating policyholders entitled to receive
notice of a meeting of participating policyholders, the directors may fix in
advance a date as the record date for the determination of participating
policyholders, but the record date so fixed must not precede the date on which
the meeting is to be held by more than 90 days or less than 21 days.
(4) If
no record date is fixed under subsection (3) for the determination of
participating policyholders entitled to receive notice of a meeting, the record
date for that purpose is
                                (a)   the
day immediately before the day on which the notice is given, or
                                (b)   if
no notice is given, the day on which the meeting is held.
(5) Before
a meeting of participating policyholders, the directors may fix a date as the
record date for the purpose of determining participating policyholders entitled
to vote at the meeting, and that record date must not be more than 10 days
before the date on which the meeting is to be held.
(6) If
no record date is fixed under subsection (5) for the determination of
participating policyholders entitled to vote at a meeting, the record date for
that purpose is the day on which the meeting is held.
(7) For
the purpose of determining shareholders entitled to receive notice of and to
vote at a meeting of shareholders, the directors may fix in advance a date as
the record date for the determination of shareholders, but the record date so
fixed must not precede the date on which the meeting is to be held by more than
50 days or less than 21 days.
(8) If
no record date is fixed under subsection (7) for the determination of
shareholders entitled to receive notice of and to vote at a meeting, the record
date for the determination of shareholders entitled to receive notice of and to
vote at the meeting is
                                (a)   the
day immediately before the day on which the notice is given, or
                                (b)   if
no notice is given, the day on which the meeting is held.
(9) Subject
to subsections (10) and (11), where a record date is fixed for a provincial
company, notice of the record date must be given not less than 7 days before
the record date
                                (a)   by
advertisement in a newspaper in general circulation in the place where the head
office of the company is located and in each place in Canada where the company
has a transfer agent or where a transfer of the company’s shares may be
recorded, and
                                (b)   by
written notice to each recognized stock exchange in Canada on which the shares
of the company are listed for trading.
(10) Notice
of a record date fixed for a provincial company need not be given if
                                (a)   the
company has no participating policyholders or notice of the record date is
waived in writing by every participating policyholder who holds a policy at the
close of business on the date the directors fix as the record date, and
                                (b)   notice
of the record date is waived in writing by every holder of a share of the class
or series affected whose name is set out in the central securities register at
the close of business on the date the directors fix as the record date.
(11) Where the bylaws provide, a provincial company
is not required to give notice by advertisement in a newspaper under subsection
(9) of a record date for the determination of participating policyholders or
shareholders entitled to receive notice of a meeting of participating
policyholders or shareholders if the record date is included in the notice of
the meeting.
1999 cI‑5.1 s269
Notice of meeting
270(1) A provincial company must send a notice of the
time and place of a meeting of its participating policyholders or shareholders
not less than 21 days nor more than 50 days before the meeting to
                                (a)   each
shareholder entitled to receive notice of the meeting,
                                (b)   each
participating policyholder who has within 3 years before the record date fixed
or determined under section 269(3) or (4) completed and returned to the company
the form referred to in section 292(1)(b) if no business referred to in clause
(c) is to be dealt with at the meeting,
                                (c)   every
participating policyholder determined under section 269(3) or (4) if any of the
following business is to be dealt with at the meeting:
                                          (i)   authorizing the company to apply to the Minister for the approval
of a mutualization proposal or of an amalgamation agreement,
                                         (ii)   confirming a bylaw changing the rights of policyholders to vote
at meetings of policyholders or shareholders,
                                        (iii)   approving an agreement setting out the terms and means of
effecting
                                                (A)   the transfer of all or substantially all of
the company’s policies, or
                                                 (B)   the reinsurance of all or substantially all
of the company’s policies,
                                            or
                                        (iv)   approving a proposal to convert the company from a mutual
provincial company into a provincial company with common shares,
                                (d)   each
director,
                                (e)   the
auditor of the company, and
                                 (f)   the
actuary of the company.
(2) The
Minister, having regard to the size of a provincial company and of the
companies or bodies corporate with which it proposes to amalgamate, may exempt
the company from the application of subsection (1)(c) with respect to business
consisting of the approval of an amalgamation agreement.
(3) In
addition to the notice required under subsection (1),
                                (a)   where
any class of shares of a provincial company is publicly traded on a recognized
stock exchange in Canada, notice of the time and place of the meeting of
shareholders must be published once a week for at least 4 consecutive weeks
before the date of the meeting in a newspaper in general circulation in the
place where the head office of the company is located and in each place in
Canada where the company has a transfer agent or where a transfer of the
company’s shares may be recorded, or
                                (b)   where
the company is a mutual provincial company, notice of the time and place of the
meeting of participating policyholders of the company and the nature of the
business in sufficient detail to permit a participating policyholder to form a
reasoned judgment on the nature of the business, together with information on
the means by which any policyholder can receive the notice referred to in
subsection (1), must be
                                          (i)   published once a week for at least 4 consecutive weeks before the
date of the meeting in a newspaper in general circulation in the place where
the head office of the company is located and in each province or territory in
which more than 1% of the total number of participating policyholders reside,
or
                                         (ii)   sent to every participating policyholder.
(4) A
notice of the annual meeting of participating policyholders and shareholders
must include a copy of the provincial company’s annual financial statements for
the preceding year unless the participating policyholder or shareholder has
advised the provincial company that the holder does not wish to receive the
annual financial statements.
(5) Failure to receive a notice of a meeting of
participating policyholders or shareholders does not deprive a participating
policyholder or shareholder of the right to vote at the meeting.
1999 cI‑5.1 s270
Notice of adjourned
meeting
271(1) If a meeting of participating policyholders or
shareholders of a provincial company is adjourned for less than 30 days, it is
not necessary, unless the bylaws otherwise provide, to give notice of the
adjourned meeting, other than by announcement at the time of the adjournment.
(2) If a meeting of participating policyholders or
shareholders of a provincial company is adjourned by one or more adjournments
for an aggregate of 30 days or more, notice of the adjourned meeting must be
given as for an original meeting but, unless the meeting is adjourned by one or
more adjournments for an aggregate of more than 90 days, section 304 does not
apply.
1999 cI‑5.1 s271
Special business
272(1) All matters dealt with at an annual or special
meeting of participating policyholders or shareholders are special business
except the election of directors and consideration of
                                (a)   the
financial statements,
                                (b)   the
auditor’s report,
                                (c)   the
actuary’s report,
                                (d)   the
remuneration of directors and reappointment of the incumbent auditor, or
                                (e)   the
description of the roles of the actuary and the auditor in the preparation and
audit of the financial statements.
(2) Notice
of a meeting of participating policyholders or shareholders of a provincial
company at which special business is to be transacted must
                                (a)   state
the nature of the special business in sufficient detail to permit a
participating policyholder or shareholder to form a reasoned judgment on the
nature of the special business,
                                (b)   contain
the text of any special resolution to be submitted to the meeting, and
                                (c)   state,
where a management proxy circular is sent to shareholders concurrently with the
notice, that a participating policyholder is entitled on request to receive a
copy of the management proxy circular.
(3) The
Minister may exempt a provincial company from the application of subsection
(2)(b) in relation to participating policyholders on condition that, instead of
sending the policyholders the text of a special resolution to be submitted to a
meeting, the company send the policyholders a summary of the text.
(4) The text of a special resolution may be amended
at a meeting of participatingÂ
policyholders or shareholders if the amendments correct manifest errors
or are not material.
1999 cI‑5.1 s272
Waiver of notice
273(1) A participating policyholder, a shareholder and
any other person entitled to attend a meeting of participating policyholders or
shareholders may in any manner waive notice of a meeting of participating
policyholders or shareholders.
(2) Attendance at a meeting of participating
policyholders or shareholders is a waiver of notice of the meeting, except when
a person attends the meeting for the express purpose of objecting to the
transaction of any business on the grounds that the meeting is not lawfully
called.
1999 cI‑5.1 s273
Policyholder and
shareholder proposals
274(1) A participating policyholder or shareholder of
a provincial company may
                                (a)   submit
to the company notice of a proposal of any matter that the participating
policyholder or shareholder intends to raise at the meeting, and
                                (b)   discuss
at the meeting any matter in respect of which the participating policyholder or
shareholder would have been entitled to submit a proposal.
(2) A
provincial company must attach to the notice of the meeting any notice of
proposal of a participating policyholder or shareholder submitted for
consideration at a meeting of policyholders and shareholders.
(3) If
so requested by a participating policyholder or shareholder who submits a
notice of proposal to a provincial company, the company must attach to the
notice of the meeting a statement by the participating policyholder or
shareholder of not more than 200 words in support of the proposal and the name
and address of the participating policyholder or shareholder.
(4) A
proposal may include nominations for the election of directors if the proposal
is signed by
                                (a)   one
or more holders of shares representing in the aggregate not less than 5% of the
shares or 5% of the shares of a class of shares of the provincial company
entitled to vote at the meeting at which the proposal is to be presented, in
the case of nominations for the directors to be elected by shareholders, or
                                (b)   at
least 100 participating policyholders or 10% of the total number of those
policyholders, whichever is fewer, in the case of nominations for the directors
to be elected by participating policyholders.
(5) A
provincial company is not required to comply with subsections (2) and (3) if
                                (a)   the
notice of the proposal is not submitted to the company at least 90 days before
the anniversary date of the previous annual meeting of participating
policyholders and shareholders,
                                (b)   it
clearly appears that the proposal is submitted by the participating
policyholder or shareholder primarily for the purpose of enforcing a personal
claim or redressing a personal grievance against the company or its directors,
officers or security holders, or for a purpose that is not related in any
significant way to the business or affairs of the company,
                                (c)   the
company, at the participating policyholder’s or shareholder’s request, attached a notice of proposal to the
notice of a meeting of participating policyholders or shareholders held within
2 years preceding the receipt of the request, and the participating policyholder
or shareholder failed to present the proposal, in person or by proxy, at the
meeting,
                                (d)   substantially
the same proposal was submitted to participating policyholders or shareholders
in a dissident’s proxy circular relating to, or was attached to the notice of,
a meeting of participating policyholders or shareholders held within 2 years
preceding the receipt of the participating policyholder’s or shareholder’s
request and the proposal was defeated,
                                (e)   in
the case of a proposal submitted by a participating policyholder that relates to
business that is referred to in section 270(1)(c), the notice of proposal is
not signed by at least 100 participating policyholders or 10% of the total
number of those policyholders, whichever is fewer,
                                 (f)   in
the case of any other proposal submitted by a participating policyholder, the
notice of proposal is not signed by at least 100 participating policyholders,
or
                                (g)   in
the case of a proposal submitted by a participating policyholder, the proposal
                                          (i)   relates to the management of the ordinary business and affairs of
the company,
                                         (ii)   would, if implemented, result in a change in the character or
direction of the company that would have a material adverse effect on the
ability of the company to meet the reasonable expectations of the company’s
participating policyholders as to the net cost of their insurance, or
                                        (iii)   would result in the conversion of a mutual provincial company
into a provincial company with common shares.
(6) No provincial company or person acting on
behalf of a company incurs any liability by reason only of circulating a notice
of proposal or statement in compliance with subsections (2) and (3).
1999 cI‑5.1 s274
Refusal of proposal
275(1) If a provincial company refuses to attach a
proposal to the notice of the meeting, the company must, within 10 days after
receiving the proposal, notify the participating policyholder or shareholder
submitting the proposal of its intention not to attach the proposal to the
notice of the meeting and send to the participating policyholder or shareholder
a statement of the reasons for the refusal.
(2) On
the application of a participating policyholder or shareholder claiming to be
aggrieved by a provincial company’s refusal under subsection (1), the Court may
restrain the holding of the meeting at which the proposal is sought to be
presented and make any further order it thinks fit.
(3) A
provincial company or any person claiming to be aggrieved by a proposal may
apply to the Court for an order permitting the company not to attach the notice
of proposal to the notice of the meeting, and the Court, if it is satisfied
that section 274(5) applies, may make any order it thinks fit.
(4) An applicant under subsection (2) or (3) must
give the Minister written notice of the application, and the Minister may
appear and be heard at the hearing of the application in person or by counsel.
1999 cI‑5.1 s275
Policyholder and
shareholder lists
276(1) For each meeting of participating policyholders
or shareholders of a provincial company, the company must prepare
                                (a)   a
list of its participating policyholders entitled to vote at the meeting, and
                                (b)   a
list of its shareholders entitled to vote at the meeting arranged in
alphabetical order and showing the number of shares held by each shareholder.
(2) If
a record date is fixed under section 269(5), the list of participating
policyholders must be prepared not later than the day on which the meeting is
held and, if no record date is fixed under section 269(5), the list must be
prepared on the day on which the meeting is held.
(3) If
a record date is fixed under section 269(7), the list of shareholders must be
prepared not later than 10 days after that record date, and if no record date
is fixed under section 269(7), the list must be prepared
                                (a)   at
the close of business on the day immediately before the day on which the notice
of the meeting is given, or
                                (b)   if
no notice is given, on the day on which the meeting is held.
(4) A
list of participating policyholders or shareholders may be in electronic form.
(5) Subject
to this Act, a person named in a list of participating policyholders prepared
under subsection (1) is entitled to vote at the meeting to which the list
relates unless, after the record date fixed under section 269(5) or, if no
record date is fixed under section 269(5), after the date on which the list was
prepared,
                                (a)   the
person has transferred the policy entitling the holder to vote, in which case
the transferee is entitled to vote at the meeting, or
                                (b)   the
policy entitling the person to vote is not in force.
(6) Subject
to this Act, a person named in a list of shareholders prepared under subsection
(1) is entitled to vote the shares shown opposite that person’s name at the
meeting to which the list relates unless
                                (a)   the
person has transferred the ownership of any of those shares after the record
date fixed under section 269(7), or if no record date is fixed under section
269(7), after the date on which the list was prepared, and
                                (b)   the
transferee of those shares
                                          (i)   produces properly endorsed share certificates, or
                                         (ii)   otherwise establishes that the transferee owns the shares,
                                         and demands, not later than
10 days before the meeting or such shorter period before the meeting as the
bylaws of the company provide, that the transferee’s name be included in the
list before the meeting,
in which case the
transferee may vote those transferred shares at the meeting.
(7) A
participating policyholder or shareholder of a provincial company may examine
the list of shareholders prepared under subsection (1)
                                (a)   during
normal business hours at the company’s head office or, if the company has been
authorized to keep its central securities register at a place other than its
head office, at that other place, and
                                (b)   at
the meeting of shareholders for which the list was prepared.
(8) A participating policyholder or shareholder of
a provincial company may, at the meeting of participating policyholders for
which the list referred to in subsection (1) was prepared, require the company
to verify from that list whether a person identified both by name and by some
other distinguishing feature is entitled to vote at that meeting.
1999 cI‑5.1 s276
Quorum
277(1) Unless the bylaws otherwise provide, a quorum
of shareholders is present at a meeting of shareholders if the holders of a
majority of the shares who are entitled to vote at the meeting are present in
person or represented by proxyholders.
(2) A
quorum of participating policyholders is present at a meeting of participating
policyholders if at least 100 participating policyholders or 10% of the total
number of those policyholders, whichever is fewer, are present in person or
represented by proxyholders.
(3) A
quorum of participating policyholders and shareholders is present at a meeting
of participating policyholders and shareholders if
                                (a)   unless
the bylaws otherwise provide, the holders of a majority of the shares who are
entitled to vote at the meeting, and
                                (b)   at
least 100 participating policyholders or 10% of the total number of those
policyholders, whichever is fewer,
are present in person
or represented by proxyholders.
(4) If
a quorum is present at the opening of a meeting of participating policyholders
or shareholders, the participating policyholders or shareholders present may,
unless the bylaws otherwise provide, proceed with the business of the meeting
even though a quorum is not present throughout the meeting.
(5) If a quorum is not present at the opening of a
meeting of participating policyholders or shareholders, or within such
reasonable time after the opening of the meeting as the participating
policyholders or shareholders present may determine, the participating
policyholders or shareholders present may adjourn the meeting to a fixed time
and place, but must not transact any other business.
1999 cI‑5.1 s277
One shareholder meeting
278 If a provincial company has
only one shareholder, or only one holder of any class or series of shares, the
shareholder present in person or represented by a proxyholder constitutes a
meeting of shareholders or a meeting of shareholders of that class or series.
1999 cI‑5.1 s278
Meeting by electronic
means
279 A participating policyholder,
shareholder or other person entitled to attend a meeting of participating
policyholders or shareholders may
participate in the meeting by means of telephone or other communication devices
that permit all persons participating in the meeting to hear each other, and a
person participating in such a meeting by those means is, for the purposes of
this Act, present at the meeting.
1999 cI‑5.1 s279
One share - one vote
280 Unless the bylaws otherwise
provide, each share of a provincial company that entitles the holder of the
share to vote at a meeting of shareholders or participating policyholders and
shareholders entitles the shareholder to one vote at the meeting.
1999 cI‑5.1 s280
One participating
policyholder - one vote
281 The holder of one or more
participating policies issued by a provincial company is entitled to attend,
and is also entitled to one vote at, a meeting of participating policyholders
or participating policyholders and shareholders of the company.
1999 cI‑5.1 s281
Changing policyholders’ right to vote
282(1) Subject to section 281, the directors of a
provincial company may make, amend or repeal any bylaw to change the rights of
participating policyholders to vote at meetings of participating policyholders
and shareholders.
(2) The
directors must submit a bylaw, or an amendment to or a repeal of a bylaw, that
is made under subsection (1) to the participating policyholders and
shareholders, and the policyholders and shareholders may, by special
resolution, confirm, amend or reject the bylaw, amendment or repeal.
(3) A
bylaw, or an amendment to or a repeal of a bylaw, made under subsection (1) is
not effective until it is
                                (a)   confirmed
or confirmed as amended by the participating policyholders and shareholders
under subsection (2), and
                                (b)   approved
by the Minister.
(4) Where a special resolution referred to in
subsection (2) so states, the directors may, before it is submitted to the
Minister for approval and without further approval of the participating
policyholders or shareholders, revoke the special resolution.
1999 cI‑5.1 s282
Proposal to amend
283(1) Subject to subsection (2), a director or a
participating policyholder or shareholder of a provincial company may, in
accordance with sections 274 and 275, make a proposal to make, amend or repeal
the bylaws of the company referred to in section 282.
(2) If a proposal is made to make, amend or repeal
the bylaws of a provincial company to effect any of the changes referred to in
section 282, notice of the meeting of participating policyholders and
shareholders at which the proposal is to be considered must set out the
proposal.
1999 cI‑5.1 s283
Representative participating policyholder or shareholder
284(1) If an entity is a participating policyholder or
shareholder of a provincial company, the company must recognize any individual
authorized by a resolution of the directors or governing body or similar
authority of the entity to represent it at meetings of participating
policyholders or shareholders of the company.
(2) An individual authorized under subsection (1)
to represent an entity may exercise on behalf of the entity all the powers the
entity could exercise if the entity were an individual who was a participating
policyholder or shareholder.
1999 cI‑5.1 s284
Joint voting
policyholders or shareholders
285 Unless the bylaws otherwise
provide, if 2 or more persons hold policies or shares jointly, one of those holders
present at a meeting of participating policyholders or shareholders may, in the
absence of the others, vote the shares or policies, but if 2 or more of those
persons who are present in person or represented by proxyholder vote, they must
vote as one on the policies or shares jointly held by them.
1999 cI‑5.1 s285
Voting by hands or
ballot
286(1) Unless the bylaws otherwise provide, voting at
a meeting of participating policyholders or shareholders must take place by
show of hands except when a ballot is demanded by a participating policyholder,
shareholder or proxyholder entitled to vote at the meeting.
(2) A participating policyholder, shareholder or
proxyholder may demand a ballot either before or on the declaration of the
result of a vote by show of hands.
1999 cI‑5.1 s286
Resolution instead of
meeting
287(1) Except where a written statement is submitted
by a director under section 326 or by an auditor under section 379(1),
                                (a)   a
resolution in writing signed by all the participating policyholders and
shareholders entitled to vote on that resolution at a meeting of participating
policyholders or shareholders is as valid as if it had been passed at a meeting
of the participating policyholders or shareholders, and
                                (b)   a
resolution in writing dealing with all matters required by this Act to be dealt
with at a meeting of participating policyholders or shareholders, and signed by
all the participating policyholders and shareholders entitled to vote at that
meeting, satisfies all the requirements of this Act relating to meetings of
participating policyholders or shareholders.
(2) A copy of every resolution referred to in
subsection (1) must be kept with the minutes of the meetings of participating
policyholders or shareholders.
1999 cI‑5.1 s287
Requisitioned meetings
288(1) Shareholders who together hold not less than 5%
of the issued and outstanding shares of a provincial company that carry the
right to vote at a meeting sought to be held may requisition the directors to
call a meeting of shareholders or participating policyholders and shareholders
for the purposes stated in the requisition.
(2) At
least 100 participating policyholders or 10% of the total number of those
policyholders, whichever is fewer, may requisition the directors to call a
meeting of participating policyholders or participating policyholders and
shareholders for the purposes stated in the requisition.
(3) A
requisition referred to in subsection (1) or (2)
                                (a)   must
state the business to be transacted at the meeting and must be sent to each
director and to the provincial company’s head office, and
                                (b)   may
consist of several documents of similar form, each signed by one or more
participating policyholders or shareholders.
(4) The
requisitioner must give notice to the Minister of a requisition made under
subsection (1) or (2).
(5) On
receipt of a requisition referred to in subsection (1) or (2), the directors
must call a meeting of participating policyholders or shareholders to transact
the business stated in the requisition, unless
                                (a)   a
record date has been fixed under section 269(3) or (7) and notice of the record
date has been given under section 269(9),
                                (b)   the
directors have called a meeting of participating policyholders or shareholders
and have given notice of the meeting under section 270, or
                                (c)   the
business of the meeting as stated in the requisition includes matters described
in section 274(5)(b) to (d) and (g).
(6) If
the directors do not call a meeting within 21 days after receiving a
requisition referred to in subsection (1) or (2), any participating
policyholder or shareholder who signed the requisition may call the meeting.
(7) A
meeting called under this section must be called as nearly as possible in the
manner in which meetings are to be called pursuant to the bylaws and this Act.
(8) Unless the participating policyholders or
shareholders otherwise resolve at a meeting called under subsection (6), the
provincial company must reimburse the participating policyholders or
shareholders for any expenses reasonably incurred by them in requisitioning,
calling and holding the meeting.
1999 cI‑5.1 s288
Meeting called by Court
289(1) Where it is impracticable
                                (a)   to
call a meeting of participating policyholders or shareholders of a provincial
company in the manner in which meetings of those policyholders or shareholders
are to be called, or
                                (b)   to
conduct the meeting in the manner required by the bylaws and this Act,
or where the Court
thinks fit to do so for any other reason, the Court, on the application of a
director or a participating policyholder or shareholder, may order a meeting to
be called, held and conducted in such manner as the Court directs.
(2) Without
restricting the generality of subsection (1), the Court may order that the
quorum required by the bylaws or this Act be varied or dispensed with at a
meeting called, held and conducted pursuant to this section.
(3) A meeting called, held and conducted pursuant
to this section is for all purposes a meeting of participating policyholders or
shareholders of the provincial company duly called, held and conducted.
1999 cI‑5.1 s289
Disputed elections and
appointments
290(1) A provincial company or a participating
policyholder, shareholder or director of a company may apply to the Court to
resolve any dispute in respect of the election or appointment of a director or
an auditor of the company.
(2) On
an application under subsection (1), the Court may make any order it thinks
fit, including, without limiting the generality of the foregoing,
                                (a)   an
order restraining a director or auditor whose election or appointment is
challenged from acting pending determination of the dispute,
                                (b)   an
order declaring the result of the disputed election or appointment,
                                (c)   an
order requiring a new election or appointment, including directions for the
management of the business and affairs of the company until a new election is
held or a new appointment is made, and
                                (d)   an order determining the voting rights of
shareholders, persons claiming to own shares, participating policyholders and
persons claiming to be participating policyholders.
1999 cI‑5.1 s290
Notice to Minister
291(1) A person who makes an application under section
289(1) or 290(1) must give notice of the application to the Minister before the
hearing and must deliver a copy of the order of the Court, if any, to the
Minister.
(2) The Minister may appear and be heard in person
or by counsel at the hearing of an application referred to in subsection (1).
1999 cI‑5.1 s291
Triennial solicitation
of policyholders
292(1) A provincial company must, at the time of the
application for or issuance of a policy the holder of which is entitled to vote
at meetings of the participating policyholders or participating policyholders
and shareholders of the company and at least once every 3 years after the
application,
                                (a)   advise
the participating policyholder of the policyholder’s right to attend and to
vote in person or by proxy at those meetings,
                                (b)   provide
the policyholder with a form for the policyholder to complete and return to the
company if the policyholder wishes to receive notices of the meetings of the
participating policyholders or participating policyholders and shareholders
during the next 3 years, and
                                (c)   provide
the participating policyholder with a form of proxy.
(2) Subsection (1) does not apply in respect of a
provincial company that provides its
participating policyholders with notices of all meetings of participating
policyholders and shareholders.
1999 cI‑5.1 s292
Take‑over Bids --
Compulsory Purchase
Application of Business
Corporations Act
293 Part 16 of the Business Corporations Act, except
section 195(3) of that Act, applies with respect to a provincial company as if
the company were a corporation within the meaning of that Act, and a reference
in that Part to a section in that Act, other than to a section in that Part, is
deemed to be a reference to the corresponding section of this Act that deals
with the same subject‑matter.
RSA 2000 cI‑3
s293;AR 49/2002 s5;2002 c30 s16
Participating
Policies and Dividends
Participating Account
294(1) A provincial company must maintain accounts in
respect of participating policies, separate from those maintained in respect of
other policies, in the form and manner determined by the Minister.
(2) The accounts maintained in respect of
participating policies are referred to in this Subpart as participating
accounts.
1999 cI‑5.1 s294
Allocation of income
295 A provincial company must credit to, or
debit from, a participating account that portion of the investment income or
losses of the company for a financial year, including accrued capital gains or
losses, whether or not realized, that is determined in accordance with a method
that is
                                (a)   in
the written opinion of the actuary of the company, fair and equitable to the participating
policyholders,
                                (b)   approved
by resolution of the directors, after consideration of the written opinion of
the actuary of the company, and
                                (c)   not disallowed by the Minister, within 60
days after the Minister receives the resolution under section 297, on the
ground that it is not fair and equitable to the participating policyholders.
1999 cI‑5.1 s295
Allocation of expenses
296 A provincial company must debit from a
participating account that portion of the expenses, including taxes, of the company
for a financial year that is determined in accordance with a method that is
                                (a)   in
the written opinion of the actuary of the company, fair and equitable to the
participating policyholders,
                                (b)   approved
by resolution of the directors, after consideration of the written opinion of
the actuary of the company, and
                                (c)   not disallowed by the Minister, within 60
days after the Minister receives the resolution under section 297, on the
ground that it is not fair and equitable to the participating policyholders.
1999 cI‑5.1 s296
Filing of allocation
method
297 The directors of a provincial
company must file a copy of any resolution referred to in section 295(b) or
296(b) with the Minister, together with a copy of the written opinion of the
actuary of the company and any other information that the Minister requests,
within 30 days after making the resolution.
1999 cI‑5.1 s297
Review of allocation
method
298 The actuary of a provincial
company must report annually in writing to the directors on the fairness and
equitableness of the method used by the company for allocating its investment
income and losses and expenses to a participating account.
1999 cI‑5.1 s298
Regulations
299 The Lieutenant Governor in Council may
make regulations
                                (a)   with
respect to a provincial company that has share capital, establishing limits on
the payment to shareholders of the company from a participating account or on
the transfer of an amount from a participating account to an account from which
payment may be made to shareholders of the company;
                                (b)   establishing limits on the transfer from a
participating account to a segregated fund maintained pursuant to section 118.
1999 cI‑5.1 s299
Declaration of policy
dividend or bonus
300(1) Subject to this section, the directors of a provincial
company that issues participating policies may declare, and the company may pay
or otherwise satisfy, a dividend, bonus or other benefit on those policies in
accordance with its dividend or bonus policy.
(2) The
directors must, before declaring a dividend, bonus or other benefit on
participating policies, consider a written report, which the actuary of the
provincial company must make, on whether in the actuary’s opinion the dividend,
bonus or other benefit is in accordance with the dividend or bonus policy of
the company.
(3) The directors of a provincial company must not
declare a dividend, bonus or other benefit to participating policyholders if
there are reasonable grounds for believing that the company is, or the payment
or other satisfaction would cause the company to be, in contravention of the
requirements of Subpart 10.
1999 cI‑5.1 s300
Division 2
Proxies and Proxy Solicitation
Definitions
301 In this Division,
                                (a)   “registrant�
means a securities broker or dealer required to be registered to trade or deal
in securities under the laws of any jurisdiction;
                                (b)   “solicit�
or “solicitation� includes
                                          (i)   a request for a proxy, whether or not accompanied with or
included in a form of proxy,
                                         (ii)   a request to execute or not to execute a form of proxy or to
revoke a proxy,
                                        (iii)   the sending of a form of proxy or other communication to a
participating policyholder or shareholder under circumstances reasonably
calculated to result in the procurement, withholding or revocation of a proxy,
and
                                        (iv)   the sending of a form of proxy to a shareholder under section
304,
                                         but does not include
                                         (v)   the sending of a form of proxy in response to an unsolicited
request made by or on behalf of a participating policyholder or shareholder,
                                        (vi)   the performance of administrative acts or professional services
on behalf of a person soliciting a proxy,
                                       (vii)   the sending by a registrant of the documents referred to in
section 307, or
                                      (viii)   a solicitation by a person in respect of shares of which that
person is the beneficial owner;
                                (c)   “solicitation by or on behalf of the
management of a provincial company� means a solicitation by any person pursuant
to a resolution or instructions of, or with the acquiescence of, the directors
or a committee of the directors of the company.
1999 cI‑5.1 s301
Appointing proxyholder
302(1) A participating policyholder or shareholder
may, by executing a form of proxy, appoint a proxyholder or one or more
alternate proxyholders, who are not required to be policyholders or shareholders,
to attend and act at the meeting of participating policyholders or shareholders
in the manner and to the extent authorized by the proxy and with the authority
conferred by the proxy.
(2) A
form of proxy must be executed by a participating policyholder or shareholder
or by a participating policyholder’s or shareholder’s attorney authorized in
writing to do so.
(3) No
appointment of a proxyholder provides authority for the proxyholder to act in
respect of the appointment of an auditor or the election of a director unless
                                (a)   a
nominee proposed in good faith for the appointment or election is named in the
form of proxy, a management proxy circular, a dissident’s proxy circular or a
proposal under section 274(1), or
                                (b)   the
form of proxy was sent to a participating policyholder pursuant to section 292.
(4) No
appointment of a proxyholder by execution of a form of proxy sent to a
participating policyholder pursuant to section 292 provides authority for the
proxyholder to act in respect of business referred to in section 270(1)(c).
(5) An
appointment of a proxyholder by execution of a form of proxy sent to a
participating policyholder pursuant to section 292 after a provincial company
receives a dissident’s proxy circular does not provide authority for the
proxyholder to act at the meeting in respect of which the dissident’s proxy
circular is sent.
(6) A
form of proxy must indicate, in boldface type, that the participating
policyholder or shareholder by whom or on whose behalf it is executed may
appoint a proxyholder, other than a person designated in the form of proxy, to
attend and act on the policyholder’s or shareholder’s behalf at a meeting to
which the proxy relates, and must contain instructions as to the manner in
which the policyholder or shareholder may do so.
(7) Subject
to subsections (4) and (5), a proxy given by a policyholder by executing a form
of proxy sent to the participating policyholder pursuant to section 292 is
valid for a period of 3 years after it is given or a lesser period specified in
the proxy and at any adjournment of a meeting begun during that period, and any
other proxy is valid only at the meeting in respect of which it is given or any
adjournment of the meeting.
(8) A
participating policyholder or shareholder may revoke a proxy
                                (a)   by
depositing a letter executed by the policyholder or shareholder or by the
policyholder’s or shareholder’s attorney authorized in writing to do so
                                          (i)   at the provincial company’s head office at any time up to and
including the last business day preceding the day of a meeting, or an
adjournment of the meeting, at which the proxy is to be used, or
                                         (ii)   with the chair of the meeting on the day of
the meeting or an adjournment of the meeting,
                                    or
                                (b)   in any other manner permitted by law.
1999 cI‑5.1 s302
Deposit of proxies
303(1) The directors may specify in a notice calling a
meeting of participating policyholders or shareholders a time preceding the
meeting or an adjournment of the meeting before which time executed forms of
proxy to be used at the meeting must be deposited with the provincial company
or its transfer agent.
(2) The
time specified for the deposit of forms of proxy must not precede the meeting
by more than
                                (a)   48
hours, excluding Saturdays and holidays, in the case of forms of proxy executed
by shareholders, and
                                (b)   10 days, in the case of forms of proxy
executed by participating policyholders.
1999 cI‑5.1 s303
Mandatory solicitation
304(1) Subject to section 271(2) and subsection (2),
the management of a provincial company must, concurrently with giving notice of
a meeting of shareholders, send a form of proxy to each shareholder entitled to
receive notice of the meeting.
(2) Where a provincial company has fewer than 15
shareholders, 2 or more joint holders being counted as one shareholder, the
management of the company is not required to send a form of proxy to the
shareholders under subsection (1).
1999 cI‑5.1 s304
Soliciting proxies
305(1) A person must not solicit proxies unless
                                (a)   in
the case of solicitation by or on behalf of the management of a provincial
company, a management proxy circular, either as an appendix to or as a separate
document accompanying the notice of the meeting, or
                                (b)   in
the case of any other solicitation, a dissident’s proxy circular stating the
purposes of the solicitation
is sent to the auditor
of the company, to each participating policyholder or shareholder whose proxy
is solicited and, if clause (b) applies, to the company.
(2) A
person who sends a management proxy circular or dissident’s proxy circular must
concurrently file with the Minister
                                (a)   in
the case of a management proxy circular, a copy of the circular together with a
copy of the notice of meeting, form of proxy and any other documents for use in
connection with the meeting, and
                                (b)   in
the case of a dissident’s proxy circular, a copy of the circular together with
a copy of the form of proxy and any other documents to be used in connection
with the meeting.
(3) Subsection
(1) does not apply in respect of the solicitation of proxies by the provision
of a form of proxy pursuant to section 292.
(4) On
the application of an interested person, the Minister may, on the terms the
Minister thinks fit, exempt the interested person from any of the requirements
of subsection (1) and section 304, and the exemption may be given retroactive
effect.
(5) The Minister must set out in The Alberta
Gazette the particulars of exemptions granted under subsection (4) together
with the reasons for granting the exemptions.
1999 cI‑5.1 s305
Attendance at meeting
306(1) A person who solicits a proxy and is appointed
proxyholder must attend in person or cause an alternate proxyholder to attend
every meeting in respect of which the proxy is valid, and the proxyholder or
alternate proxyholder must comply with the directions of the participating
policyholder or shareholder who executed the form of proxy.
(2) A proxyholder or an alternate proxyholder has
the same rights as the appointing participating policyholder or shareholder to
speak at a meeting of policyholders or
shareholders in respect of any matter, to vote by way of ballot at the meeting
and, except where the proxyholder or alternate proxyholder has conflicting
instructions from more than one policyholder or shareholder, to vote at such a
meeting in respect of any matter by way of a show of hands.
1999 cI‑5.1 s306
Duty of registrant
307(1) Shares of a provincial company that are
registered in the name of a registrant or registrant’s nominee and that are not
beneficially owned by the registrant must not be voted unless the registrant
sends to the beneficial owner
                                (a)   forthwith
after receiving them, a copy of the notice of the meeting, annual statement,
management proxy circular, dissident’s proxy circular and any other documents,
other than the form of proxy, that were sent to shareholders by or on behalf of
any person for use in connection with the meeting, and
                                (b)   a
written request for voting instructions, except where the registrant has
already received written voting instructions from the beneficial owner.
(2) A
registrant must not vote or appoint a proxyholder to vote shares of a
provincial company registered in the registrant’s name or in the name of the
registrant’s nominee that the registrant does not beneficially own unless the
registrant receives voting instructions from the beneficial owner.
(3) A
person by or on behalf of whom a solicitation is made must, at the request of a
registrant, forthwith provide the registrant, at that person’s expense, with
the necessary number of copies of the documents referred to in subsection
(1)(a).
(4) A
registrant must vote or appoint a proxyholder to vote any shares referred to in
subsection (1) in accordance with any written voting instructions received from
the beneficial owner.
(5) If
requested by a beneficial owner, a registrant must appoint the beneficial owner
or a nominee of the beneficial owner as proxyholder.
(6) The
failure of a registrant to comply with any of subsections (1) to (5) does not
render void any meeting of participating policyholders or shareholders or any
action taken at the meeting.
(7) Nothing in this Subpart gives a registrant the
right to vote shares that the registrant is otherwise prohibited from voting.
1999 cI‑5.1 s307
Restraining order
308(1) If a form of proxy, management proxy circular
or dissident’s proxy circular contains an untrue statement of a material fact
or omits to state a material fact required in the document or necessary to make
a statement contained in the document not misleading in the light of the circumstances
in which it was made, an interested person or the Minister may apply to the
Court and the Court may make any order it thinks fit, including, without
limiting the generality of the foregoing,
                                (a)   an
order restraining the solicitation or the holding of the meeting, or
restraining any person from implementing or acting on any resolution passed at
the meeting, to which the form of proxy, management proxy circular or
dissident’s proxy circular relates,
                                (b)   an
order requiring correction of any form of proxy or proxy circular and a further
solicitation, and
                                (c)   an
order adjourning the meeting.
(2) Where a person other than the Minister is an
applicant under subsection (1), the applicant must give to the Minister notice
of the application and the Minister is entitled to appear and to be heard in
person or by counsel.
1999 cI‑5.1 s308
Subpart 6
Directors and Officers
Duties
Duty to manage
309(1) Subject to this Act, the directors of a
provincial company must manage or supervise the management of the business and
affairs of the company.
(2) Without
limiting the generality of subsection (1), the directors of a provincial
company must
                                (a)   establish
an audit committee and a conduct review committee;
                                (b)   establish
procedures to resolve conflicts of interest, including techniques for the
identification of potential conflict situations and for restricting the use of
confidential information;
                                (c)   in
the case of a company that issues participating policies, establish, before
issuing any participating policies, a policy for determining the dividends and
bonuses to be paid to the participating policyholders;
                                (d)   establish
procedures to provide disclosure of information that this Act and the
regulations require to be disclosed;
                                (e)   establish
policies and procedures to ensure that the company applies prudent investment
standards in accordance with section 417;
                                 (f)   appoint
the actuary of the company.
(3) Subsection
(2)(a) does not apply to the directors of a provincial company where
                                (a)   all
the voting shares of the company, other than directors’ qualifying shares, if
any, are beneficially owned by a financial institution incorporated by or under
an Act of the Legislature,
                                (b)   there
are no participating policyholders, and
                                (c)   the audit committee or the conduct review
committee of the financial institution referred to in clause (a) performs for
and on behalf of the company all the functions that would otherwise be required
to be performed by the audit committee or conduct review committee of the
company under this Act.
1999 cI‑5.1 s309
Duty of care
310(1) Every director and officer of a provincial
company in exercising any of the powers of a director or an officer and
discharging any of the duties of a director or an officer must
                                (a)   act
honestly and in good faith with a view to the best interests of the company,
and
                                (b)   exercise
the care, diligence and skill that a reasonable and prudent person would
exercise in comparable circumstances.
(2) Every
director, officer and employee of a provincial company must comply with this
Act, the regulations, the company’s instrument of incorporation and the bylaws
of the company.
(3) No provision in any contract, in any resolution
or in the bylaws of a provincial company relieves any director, officer or
employee of the company from the duty to act in accordance with this Act and
the regulations or relieves a director, officer or employee from liability for
a breach of that duty.
1999 cI‑5.1 s310
Qualifications and Number
of Directors
Minimum number of
directors
311(1) A provincial company must have at least 5
directors.
(2) A majority of the directors must be ordinarily
resident in Canada.
1999 cI‑5.1 s311
Disqualified persons
312(1) The following persons are disqualified from
being directors of a provincial company:
                                (a)   a
person who is less than 18 years of age;
                                (b)   a
person who is of unsound mind and has been so found by a court in Canada or
elsewhere;
                                (c)   a
person who has the status of an undischarged bankrupt;
                                (d)   a
person who is not an individual;
                                (e)   a
person who holds shares of the company where, by section 257(6), the person is
prohibited from exercising the voting rights attached to the shares;
                                 (f)   a
person who is an officer, director or full‑time employee of an entity
that holds shares of the company where, by section 257(6), the entity is
prohibited from exercising the voting rights attached to the shares;
                                (g)   a
person who is a dependent adult as defined by the Dependent Adults Act or is the subject of a certificate of
incapacity under that Act;
                                (h)   a
person employed in the public service of Alberta or by a Provincial agency or
Crown‑controlled organization within the meaning of the Financial Administration Act and to
which that Act applies, whether under a contract of service or a contract for
services, whose substantive duties are directly concerned with the business or
affairs of insurers, insurance agents or adjusters;
                                 (i)   a
person who fails to meet any other qualification requirements of the bylaws;
                                 (j)   a
person who, within the immediately preceding 5 years,
                                          (i)   has been convicted of an indictable offence that is of a kind
that is related to the qualifications, functions or duties of a corporate
director, or
                                         (ii)   has been convicted of an offence against this Act,
                                         if the time for making an
appeal has expired without an appeal having been made or the appeal has been
finally disposed of by the courts or abandoned.
(2) A shareholder of a provincial company is
disqualified from being a participating policyholders’ director of the company.
1999 cI‑5.1 s312
No requirement to hold
shares or policies
313 A director of a provincial
company is not required to hold shares of or a policy issued by the company.
1999 cI‑5.1 s313
Affiliated directors
314(1) In this section,
                                (a)   “not
in good standing�, in respect of a loan, means that, in respect of that loan,
                                          (i)   any payment of principal or interest is 90 days or more overdue,
                                         (ii)   interest is not being accrued on the books of the lender because
it is doubtful whether the principal or interest will be paid or recovered, or
                                        (iii)   the rate of interest is reduced by the lender because the
borrower is financially weak;
                                (b)   “significant
borrower� means
                                          (i)   an entity that has outstanding indebtedness for money borrowed
from the provincial company and from any affiliate of the company in an
aggregate principal amount that exceeds 25% of the equity in the entity, or
                                         (ii)   an individual who has outstanding indebtedness for money borrowed
from the provincial company and any affiliate of the company, other than a loan
secured by a mortgage on the principal residence of that individual, in an
aggregate principal amount that exceeds 25% of the individual’s net worth.
(2) Not
more than 1/3 of the directors of a provincial company may be individuals who
are, or within the preceding 2 years have been, remunerated officers, employees, insurance agents, insurance
brokers or adjusters of the company or any of its affiliates.
(3) No
more than 2/3 of the directors may be affiliated directors.
(4) An
individual is an affiliated director of a provincial company if the individual
                                (a)   is
an officer or employee of the company or an affiliate of the company,
                                (b)   has
a significant interest in a class of shares of the company,
                                (c)   has
a substantial investment in an affiliate of the company,
                                (d)   is
a significant borrower in respect of the company,
                                (e)   is
a director, officer or employee of an entity that is a significant borrower in
respect of the company,
                                 (f)   controls
one or more entities of which the total indebtedness to the company or to an
affiliate of the company would cause those entities, if treated as a single
entity, to be a significant borrower of the company,
                                (g)   provides
goods or services to the company, or is a partner or an employee in a
partnership that provides goods or services to the company or an officer or
employee of, or a person who has a substantial investment in, a body corporate
that provides goods or services to the company, if the total annual billings to
the company in respect of the goods and services provided exceeds 10% of the
total annual billings of the individual, partnership or body corporate, as the
case may be,
                                (h)   has
a loan that is not in good standing from the company or from an affiliate of
the company or is a director, an officer or an employee of, or an individual
who controls, an entity that has a loan that is not in good standing from the
company or from an affiliate of the company,
                                 (i)   is
a professional advisor to the company,
                                 (j)   is
an insurance agent, insurance broker or adjuster of the company,
                                (k)   is
the spouse or adult interdependent partner of an individual described in any of
clauses (a) to (j), or
                                 (l)   is
a relative of an individual described in any of clauses (a) to (j) who resides
in the same home as the individual.
(5) Whether a person is affiliated with a
provincial company is determined as of the day the notice of the annual meeting
is sent to participating policyholders and shareholders and that determination
becomes effective on the day of that meeting, and a person is deemed to
continue to be affiliated or unaffiliated, as the case may be, until the next
annual meeting of participating policyholders and shareholders.
RSA 2000 cI‑3
s314;2002 cA‑4.5 s45
Election and Tenure of
Directors
Number of directors
315(1) Subject to sections 311(1) and 320, the
directors of a provincial company must, by bylaw, determine the number of
directors or the minimum and maximum number of directors, but no bylaw that
decreases the number of directors shortens the term of an incumbent director.
(2) Subject
to sections 311(1) and 320, if a provincial company has common shares and
participating policyholders, the directors of the company must by bylaw
determine the number of directors, or the minimum and maximum number of
directors, who are to be elected by the shareholders and the number, or the
minimum and maximum number, who are to be elected by the participating
policyholders.
(3) A
bylaw made pursuant to subsection (1) or (2) that provides for a minimum and
maximum number of directors may provide that the number of directors,
shareholders’ directors or participating policyholders’ directors to be elected
at any annual meeting of the participating policyholders and shareholders is to
be the number fixed by the directors prior to the annual meeting.
(4) The
number of shareholders’ directors and the number of participating
policyholders’ directors, whether determined by bylaw or fixed by the
directors, must each be at least 1/3 of the total number of directors.
(5) If the shareholders of a mutual provincial
company are entitled to elect one or more directors of the company, not more
than 1/3 of the directors may be elected by the shareholders.
1999 cI‑5.1 s315
Changing number of
directors
316(1) Subject to sections 311(1), 315(4) and 320, the
directors of a provincial company may make, amend or repeal any bylaw to
increase or decrease the number of directors or the minimum or maximum number
of directors, directors who are to be elected by the shareholders or directors
who are to be elected by the participating policyholders.
(2) The
directors must submit a bylaw, or an amendment to or a repeal of a bylaw, that
is made under subsection (1) to the participating policyholders and
shareholders, and the policyholders and shareholders may, by special
resolution, confirm, amend or reject the bylaw, amendment or repeal.
(3) A
bylaw, or an amendment to or a repeal of a bylaw, made under subsection (1) is
not effective until it is confirmed or confirmed as amended by the
policyholders and shareholders under subsection (2).
(4) Where a special resolution referred to in
subsection (2) so states, the directors may, without further approval of the
policyholders or shareholders, revoke the special resolution.
1999 cI‑5.1 s316
Proposal to amend
317(1) Subject to subsection (2), a director or a
policyholder or shareholder who is entitled to vote at an annual meeting of
policyholders and shareholders of a provincial company may, in accordance with
sections 274 and 275, make a proposal to make, amend or repeal the bylaws of
the company referred to in section 316.
(2) If a proposal is made to make, amend or repeal
the bylaws of a provincial company to effect any of the changes referred to in
section 316, notice of the meeting of policyholders and shareholders at which
the proposal is to be considered must set out the proposal.
1999 cI‑5.1 s317
Term of directors
318(1) The provincial company may, by bylaw, provide
that the directors be elected for a maximum of 3 years.
(2) The
term of a director ends at the close of the annual meeting of participating
policyholders and shareholders held in the year in which the director’s term
ends.
(3) A director who is not elected for an expressly
stated term of office holds office for a one‑year term.
1999 cI‑5.1 s318
Determining election of
directors
319(1) Except where the bylaws of a provincial company
provide for cumulative voting, the individuals who receive the greatest number
of votes at an election of directors of a company, up to the number authorized
to be elected, are the directors of the company.
(2) If
a provincial company has common shares and participating policyholders, a
shareholder of the company
                                (a)   is
not entitled to vote for the participating policyholders’ directors if the
shareholder is not a participating policyholder, and
                                (b)   is
not entitled to vote any shares for the policyholders’ directors.
(3) If
a provincial company has common shares and participating policyholders, a
participating policyholder of the company
                                (a)   is
not entitled to vote for the shareholders’ directors if the participating
policyholder is not a shareholder, and
                                (b)   is
not entitled to vote as a participating policyholder for the shareholders’
directors.
(4) If at any election of directors referred to in
subsection (1) 2 or more persons receive an equal number of votes and there are
not sufficient vacancies remaining to enable all the individuals receiving an
equal number of votes to be elected, the directors who receive a greater number
of votes, or the majority of those directors, must, in order to complete the
full number of directors, determine which of the persons receiving an equal number of votes are to be
elected.
1999 cI‑5.1 s319
Cumulative voting
320(1) Where the bylaws provide for cumulative voting,
                                (a)   in
the case of a provincial company that has no participating policyholders, there
must be a stated number of directors determined by bylaw, and not a minimum and
maximum number;
                                (b)   in
the case of a provincial company that has participating policyholders, there
must be a stated number of shareholders’ directors determined by bylaw, and not
a minimum and maximum number;
                                (c)   each
shareholder entitled to vote at an election of directors to be elected by
cumulative voting has the right to cast a number of votes equal to the number
of votes attached to the shares held by the shareholder multiplied by the
number of directors to be elected by cumulative voting, and the shareholder may
cast all such votes in favour of one candidate or distribute them among the
candidates in any manner;
                                (d)   a
separate vote must be taken with respect to each candidate nominated for a
position that is to be filled by cumulative voting, unless a resolution is
passed unanimously permitting 2 or more persons to be elected by a single vote;
                                (e)   if
a shareholder has voted for more than one candidate without specifying the
distribution of the votes among the candidates, the shareholder is deemed to
have distributed the votes equally among the candidates for whom the
shareholder voted;
                                 (f)   if
the number of candidates nominated exceeds the number of positions to be
filled, the candidates who receive the least number of votes must be eliminated
until the number of candidates remaining equals the number of positions to be
filled;
                                (g)   each
director elected by cumulative voting ceases to hold office at the close of the
next annual meeting of participating policyholders and shareholders following
the director’s election;
                                (h)   a
director elected by cumulative voting must not be removed from office if the
votes cast against the removal would be sufficient to elect the director and
those votes could be voted cumulatively at an election at which the same total
number of votes were cast and the same number of directors required by the
bylaws to be elected by cumulative voting were then being elected;
                                 (i)   the number of directors required by the
bylaws to be elected by cumulative voting must not be decreased if the votes
cast against the motion to decrease would be sufficient to elect a director and
those votes could be voted cumulatively at an election at which the same total
number of votes were cast and the same number of directors required by the
bylaws to be elected by cumulative voting were then being elected.
1999 cI‑5.1 s320
Class or series of
shares
321 Nothing in this Act precludes
the holders of any class or series of shares of a provincial company from
having an exclusive right to elect one or more directors.
1999 cI‑5.1 s321
Re‑election of
directors
322 A director who has completed a
term of office is, if otherwise qualified, eligible for re‑election.
1999 cI‑5.1 s322
Incomplete Elections and
Director Vacancies
Void election or
appointment
323(1) If directors are not elected at a meeting of
participating policyholders or shareholders, the incumbent directors continue
in office until their successors are elected.
(2) If
a meeting of participating policyholders or shareholders fails to elect the
number of directors required by this Act or the bylaws by reason of
disqualification or the incapacity or death of one or more candidates, the
directors elected at that meeting, if they constitute a quorum, may exercise
all the powers of the directors of the provincial company pending the holding
of a meeting of participating policyholders or shareholders in accordance with
subsection (3).
(3) If there is not a quorum of directors, or if
there has been a failure to elect the number or minimum number of directors
required by this Act or the bylaws, the directors then in office must forthwith
call a special meeting of participating policyholders or shareholders, as the
case may be, to fill the vacancy or vacancies, and if they fail to call a
meeting or if there are no directors then in office, any participating
policyholder or shareholder may call the meeting.
1999 cI‑5.1 s323
Ceasing to hold office
324(1) A director ceases to hold office
                                (a)   when
the director’s term of office expires,
                                (b)   when
the director dies or resigns,
                                (c)   when
the director becomes disqualified under section 312 or ineligible to hold office
pursuant to section 355(2), or
                                (d)   when
the director is removed under section 325.
(2) The resignation of a director of a provincial
company becomes effective at the time a written resignation is sent to the
company by the director or at the time specified in the resignation, whichever
is later.
1999 cI‑5.1 s324
Removal of director
325(1) Subject to section 320(1)(h) and this section,
the participating policyholders or shareholders of a provincial company may by
resolution at a special meeting remove any director or all the directors from
office.
(2) A
shareholders’ director may be removed only by a resolution of the shareholders
at a meeting of shareholders or participating policyholders and shareholders.
(3) A
participating policyholders’ director may be removed only by a resolution of
the participating policyholders at a meeting of participating policyholders or
participating policyholders and shareholders.
(4) Where
the holders of any class or series of shares of a provincial company have the
exclusive right to elect one or more directors, a director so elected may be
removed only by a resolution at a meeting of the shareholders of that class or
series.
(5) A vacancy created by the removal of a director
may be filled at the meeting of the participating policyholders or shareholders
at which the director is removed or, if not so filled, may be filled under
section 328.
1999 cI‑5.1 s325
Statement of director
326(1) A director who
                                (a)   resigns,
                                (b)   receives
a notice or otherwise learns of a meeting of participating policyholders or
shareholders called for the purpose of removing the director from office, or
                                (c)   receives
a notice or otherwise learns of a meeting of directors or participating
policyholders or shareholders at which another person is to be appointed or
elected to fill the office of director, whether because of the director’s
resignation or removal or because the director’s term of office has expired or
is about to expire,
is entitled to submit
to the provincial company a written statement giving the reasons for the
resignation or the reasons why the director opposes any proposed action or
resolution.
(2) Where a director of a provincial company
resigns as a result of a disagreement with the other directors or the officers
of the company, the director must submit to the company and the Minister a
written statement setting out the nature of the disagreement.
1999 cI‑5.1 s326
Circulation of statement
327(1) A provincial company must forthwith on receipt
of a director’s statement referred to in section 326(1) relating to a matter
referred to in section 326(1)(b) or (c), or a director’s statement referred to
in section 326(2), send a copy of the director’s statement
                                (a)   to
all other directors, and
                                (b)   unless
the directors of the company consider on reasonable grounds that sending the
statement would materially and adversely affect the financial viability of the
company, to each participating policyholder and shareholder entitled to receive
notice of meetings under section 270(1)(a) or (b) and to the Minister, unless
the statement is attached to a notice of a meeting.
(2) Where
the directors decide, under subsection (1)(b), not to send a copy of the
statement to the participating policyholders and shareholders, they must
forthwith notify the Minister in writing to that effect, and the Minister may,
despite that decision, order the provincial company to send the statement to
the participating policyholders and shareholders entitled to receive notice of
meetings under section 270(1)(a) or (b).
(3) No provincial company or person acting on its
behalf incurs any liability by reason only of circulating a director’s
statement in compliance with subsection (1).
1999 cI‑5.1 s327
Shareholders or
policyholders filling vacancy
328 The bylaws of a provincial company may
provide that a vacancy among the directors is to be filled only by vote of
                                (a)   the
participating policyholders or shareholders,
                                (b)   the
shareholders, if the vacancy occurs among the shareholders’ directors,
                                (c)   the
participating policyholders, if the vacancy occurs among the participating
policyholders’ directors, or
                                (d)   the holders of any class or series of shares
having an exclusive right to elect one or more directors if the vacancy occurs
among the directors elected by the holders of that class or series.
1999 cI‑5.1 s328
Directors filling
vacancy
329(1) Despite section 335(4)(b) but subject to
subsection (2) and sections 328, 330 and 331, a quorum of directors may fill a
vacancy among the directors except a vacancy among the directors resulting from
a change in the bylaws by which the number or minimum number of directors is
increased or from a failure to elect the number or minimum number of directors
required by the bylaws.
(2) Despite sections 324 and 335(4)(b), where by
reason of a vacancy the number of directors or the composition of the board of
directors fails to meet any of the requirements of sections 311, 314(2) and (3)
and 315(4), the directors who, in the absence of any bylaw, would be empowered
to fill that vacancy must do so forthwith.
1999 cI‑5.1 s329
Vacancy among
shareholders’ or policyholders’ directors
330 Despite section 335(4)(b) but subject to
sections 328 and 331, where a provincial company has shareholders’ directors
and participating policyholders’ directors and a vacancy occurs among those
directors,
                                (a)   the
remaining shareholders’ directors or participating policyholders’ directors, as
the case may be, may fill the vacancy except a vacancy resulting from an
increase in, or a failure to elect, the number or minimum number of
shareholders’ directors or participating policyholders’ directors,
                                (b)   if
there are no such remaining directors and, by reason of the vacancy, the number
of directors or the composition of the board of directors fails to meet any of
the requirements of sections 311, 314(2) and (3) and 315(4), the other
directors may fill that vacancy, and
                                (c)   if there are no such remaining directors and
clause (b) does not apply, any participating policyholder or shareholder may
call a meeting of participating policyholders or shareholders for the purpose
of filling the vacancy.
1999 cI‑5.1 s330
Class vacancy
331 Despite section 335(4)(b) but subject to
section 328, where the holders of any class or series of shares of a provincial
company have an exclusive right to elect one or more directors and a vacancy
occurs among those directors,
                                (a)   the
remaining directors elected by the holders of that class or series may fill the
vacancy except a vacancy resulting from an increase in, or a failure to elect,
the number or minimum number of directors for that class or series,
                                (b)   if
there are no such remaining directors and, by reason of the vacancy, the number
of directors or the composition of the board of directors fails to meet any of
the requirements of sections 311, 314(2) and (3) and 315(4), the other
directors may fill that vacancy, and
                                (c)   if there are no such remaining directors and
clause (b) does not apply, any holder of shares of that class or series may
call a meeting of the holders of those shares for the purpose of filling the
vacancy.
1999 cI‑5.1 s331
Unexpired term
332 Unless the bylaws otherwise
provide, a director elected or appointed to fill a vacancy holds office for the
unexpired term of the director’s predecessor in office.
1999 cI‑5.1 s332
Meetings of the Board
Meeting of directors
333(1) Unless the bylaws otherwise provide, the
directors may meet at any place.
(2) Notice of meetings of the directors must be
given in accordance with the bylaws.
1999 cI‑5.1 s333
Notice of meeting
334(1) A notice of a meeting of directors must specify
each matter referred to in section 350(2) that is to be dealt with at the
meeting but, unless the bylaws otherwise provide, need not otherwise specify
the purpose of or the business to be transacted at the meeting.
(2) A
director may in any manner waive notice of a meeting of directors and the
attendance of a director at a meeting of directors is a waiver of notice of
that meeting except where the director attends the meeting for the express
purpose of objecting to the transaction of any business on the grounds that the
meeting is not lawfully called.
(3) Notice of an adjourned meeting of directors is
not required to be given if the time and place of the adjourned meeting was
announced at the original meeting.
1999 cI‑5.1 s334
Quorum
335(1) The number of directors referred to in
subsection (2) constitutes a quorum at any meeting of directors or a committee
of directors and, despite any vacancy among the directors, a quorum of
directors may exercise all the powers of the directors.
(2) A
quorum for a meeting of the directors is the greater of
                                (a)   three
directors, and
                                (b)   a
majority of the directors.
(3) A
quorum for a meeting of a committee of the directors is a majority of the
directors comprising the committee.
(4) Despite
subsections (2) and (3), there is no quorum unless
                                (a)   at
least one of the directors present at the meeting is not an affiliated director
as determined under section 314(4) and (5), and
                                (b)   at
least 1/2 of the directors present at the meeting are ordinarily resident in
Canada.
(5) Any director present at a meeting of directors
who is not present at any particular time during the meeting for the purposes
of section 355(1) is considered as being present for the purposes of this section.
1999 cI‑5.1 s335
Resident Canadian
majority
336 Despite section 335, the directors of a
provincial company may transact business at a meeting of directors or of a
committee of directors without the required proportion of directors who are
ordinarily resident in Canada if
                                (a)   a
director who is ordinarily resident in Canada and is unable to be present
approves, in writing or by telephone or by any other means, the business
transacted at the meeting, and
                                (b)   there would have been present the required
proportion of directors who are ordinarily resident in Canada had that director
been present at the meeting.
1999 cI‑5.1 s336
Electronic meeting
337(1) Subject to the bylaws of a provincial company,
a meeting of directors or of a committee of directors may be held by means of
telephonic, electronic or other communications facilities that permit all
persons participating in the meeting to communicate with each other during the
meeting.
(2) A director participating in a meeting by any
means referred to in subsection (1) is, for the purposes of this Act, present
at that meeting.
1999 cI‑5.1 s337
Resolution instead of
meeting
338(1) A resolution in writing signed by all the
directors of a provincial company entitled to vote on that resolution at a
meeting of directors or a committee of directors is as valid as if it had been
passed at a meeting of directors or a committee of directors.
(2) A resolution in writing dealing with all
matters required by this Act to be dealt with at a meeting of directors or a
committee of directors of a provincial company and signed by all the directors
entitled to vote at that meeting satisfies all the requirements of this Act
relating to meetings of directors or committees of directors.
1999 cI‑5.1 s338
Dissent of director
339(1) A director of a provincial company who is
present at a meeting of directors or a committee of directors is deemed to have
consented to any resolution passed or action taken at that meeting unless
                                (a)   the
director requests that the director’s dissent be entered or the director’s
dissent is entered in the minutes of the meeting,
                                (b)   the
director sends a written dissent to the secretary of the meeting before the
meeting is adjourned, or
                                (c)   the
director sends the director’s dissent by registered mail or delivers it to the
head office of the company immediately after the meeting is adjourned.
(2) A
director of a provincial company who votes for or consents to a resolution is
not entitled to dissent under subsection (1).
(3) A
director of a provincial company who is not present at a meeting at which a
resolution is passed or action taken is deemed to have consented to the
resolution or action taken unless, within 7 days after the director becomes
aware of the resolution or action taken, the director
                                (a)   causes
the director’s dissent to be placed with the minutes of the meeting, or
                                (b)   sends the director’s dissent by registered
mail or delivers it to the head office of the company.
1999 cI‑5.1 s339
Meeting required by
Minister
340(1) The Minister may, by notice in writing, require
a provincial company to hold a meeting of directors of the company to consider
the matters set out in the notice.
(2) The Minister may attend and be heard at a
meeting referred to in subsection (1).
1999 cI‑5.1 s340
Bylaws
Bylaws
341(1) Unless this Act otherwise provides, the
directors of a provincial company may by resolution make, amend or repeal any
of the company’s bylaws.
(2) The
directors must submit a bylaw, or an amendment to or a repeal of a bylaw, that
is made under subsection (1) to the participating policyholders and
shareholders at the next meeting of participating policyholders and
shareholders, and the participating policyholders and shareholders may, by
resolution, confirm, amend or reject it.
(3) Unless
this Act or the instrument of incorporation otherwise provides, a bylaw, or an
amendment to or a repeal of a bylaw, is effective from the date of the
resolution of the directors under subsection (1) until it is confirmed,
confirmed as amended or rejected by the participating policyholders and
shareholders under subsection (2) or until it ceases to be effective under
subsection (4) and, where the bylaw is confirmed, or confirmed as amended, it
continues in effect in the form in which it was so confirmed.
(4) If a bylaw, or an amendment to or a repeal of a
bylaw, is rejected by the participating policyholders and shareholders, or is
not submitted to the participating policyholders and shareholders by the
directors as required under subsection (2), the bylaw, amendment or repeal
ceases to be effective from the date of its rejection or the date of the next
meeting of participating policyholders and shareholders, as the case may be,
and no subsequent resolution of the directors to make, amend or repeal a bylaw
having substantially the same purpose or effect is effective until it is
confirmed, or confirmed as amended, by the participating policyholders and
shareholders.
1999 cI‑5.1 s341
Policyholder or
shareholder proposal of bylaw
342 A participating policyholder
or shareholder may, in accordance with sections 274 and 275, make a proposal to
make, amend or repeal a bylaw.
1999 cI‑5.1 s342
Minister to receive
bylaws
343 A provincial company must
provide the Minister with a copy of all bylaws of the provincial company,
including amendments, within 30 days after they come into force.
1999 cI‑5.1 s343
Entitlement to copies of
bylaws
344 Every participating
policyholder and shareholder of a provincial company is entitled, on request
made not more frequently than once in each calendar year, to receive, free of
charge, one copy of the bylaws of the company.
1999 cI‑5.1 s344
Committees of the Board
Committees
345 The directors of a provincial
company may appoint from their number, in addition to the committees referred
to in section 309(2), such other committees as they deem necessary and, subject
to section 350, delegate to those committees such powers of the directors, and
assign to those committees such duties, as the directors consider appropriate.
1999 cI‑5.1 s345
Audit committee
346(1) The audit committee of a provincial company
must consist of at least 3 directors.
(2) Two
thirds of the members of the audit committee of a provincial company must be
directors who are not affiliated directors of the company as determined under
section 314(4) and (5), and none of the members of the audit committee may be
officers, employees, insurance agents, adjusters or brokers of the company or
of a subsidiary of the company.
(3) The
audit committee of a provincial company must
                                (a)   review
the annual financial statements of the company before the annual financial
statements are approved by the directors,
                                (b)   review
the annual return of the company before the annual return is approved by the
directors,
                                (c)   ensure
that appropriate internal control procedures are in place,
                                (d)   review
the investments and transactions that could adversely affect the well‑being
of the company that the auditor or any officer of the company brings to the
attention of the committee,
                                (e)   meet
with the auditor to discuss the annual financial statements and the annual
return and transactions referred to in this subsection,
                                 (f)   meet
with the actuary of the company to discuss the parts of the annual financial
statements and the annual return prepared by the actuary, and
                                (g)   meet
with the chief internal auditor of the company, or the officer or employee of
the company acting in a similar capacity, and with management of the company,
to discuss the effectiveness of the internal control procedures established for
the company.
(4) The
audit committee of a provincial company must report on the annual financial
statements and annual return to the directors before the directors approve the
statements and return.
(5) The audit committee of a provincial company may
call a meeting of the directors of the company to consider any matter of
concern to the committee.
1999 cI‑5.1 s346
Conduct review committee
347(1) The conduct review committee of a provincial
company must consist of at least 3 directors.
(2) Two‑thirds
of the members of the conduct review committee of a provincial company must be
directors who are not affiliated directors of the company as determined under
section 314(4) and (5), and none of the members of the conduct review committee
may be officers, employees, insurance
agents, adjusters or brokers of the company or of a subsidiary of the company.
(3) The
conduct review committee of a provincial company must
                                (a)   establish
procedures for the review of transactions with related parties of the provincial
company to which Subpart 12 applies,
                                (b)   review
all proposed transactions with related parties of the company in accordance
with Subpart 12, and
                                (c)   review
the practices of the company to ensure that any transactions with related
parties of the company that may have a material effect on the stability or
solvency of the company are identified.
(4) After each meeting of the conduct review
committee of a provincial company, the committee must report to the directors
of the company on all transactions and other matters reviewed by the committee.
1999 cI‑5.1 s347
Authority of Directors
and Officers
Chief executive officer
348 The directors of a provincial
company must appoint from their number a chief executive officer who must be
ordinarily resident in Canada and, subject to section 350, may delegate to that
officer any of the powers of the directors.
1999 cI‑5.1 s348
Appointment of officers
349(1) The directors of a provincial company may,
subject to the bylaws, designate the offices of the company, appoint officers
to those offices, specify the duties of those officers and, subject to section
350, delegate to them powers to manage the business and affairs of the company.
(2) A
director of a provincial company may be appointed to any office of the company.
(3) Two or more offices of a provincial company may
be held by the same person.
1999 cI‑5.1 s349
Delegation
350(1) The directors of a provincial company may
delegate any of their powers, except for the powers specified in subsection
(2).
(2) The
directors of a provincial company must not delegate the power
                                (a)   to
submit to the participating policyholders or shareholders a question or matter
requiring the approval of the participating policyholders or shareholders,
                                (b)   to
fill a vacancy among the directors or a committee of directors or in the office
of auditor or actuary of the company,
                                (c)   to
issue or cause to be issued securities, except in the manner and on terms
authorized by the directors,
                                (d)   to
declare a dividend on shares or a policy dividend, bonus or other benefit
payable to participating policyholders, other than a dividend on a group policy
that is a participating policy,
                                (e)   to
authorize the redemption or acquisition of shares issued by the company
pursuant to section 245, 246 or 247,
                                 (f)   to
authorize the payment of a commission on a securities issue,
                                (g)   to
approve a management proxy circular,
                                (h)   to
approve the annual financial statements of the company and any other financial
statements issued by the company,
                                 (i)   to
approve the annual return of the company, or
                                 (j)   to adopt, amend or repeal bylaws.
1999 cI‑5.1 s350
Remuneration
351(1) A provincial company must make bylaws
respecting the remuneration of directors.
(2) Subject to the bylaws, the directors of a
provincial company may fix the remuneration of the officers and employees of
the company.
1999 cI‑5.1 s351
Validity of acts
352(1) An act of a director or an officer of a
provincial company is valid despite a defect in the director’s qualification or
an irregularity in the director’s election or in the appointment of the
director or officer.
(2) An act of the board of directors of a
provincial company is valid despite a defect in the composition of the board or
an irregularity in the election of the board or in the appointment of a member
of the board.
1999 cI‑5.1 s352
Right to attend meetings
353 A director of a provincial
company is entitled to attend and to be heard at every meeting of participating
policyholders or shareholders.
1999 cI‑5.1 s353
Conflicts of Interest
Disclosure of interest
354(1) A director or an officer of a provincial
company who
                                (a)   is
a party to a material contract or proposed material contract with the company,
                                (b)   is
a director or an officer of any entity that is a party to a material contract
or proposed material contract with the company, or
                                (c)   has
a material interest in any person who is a party to a material contract or
proposed material contract with the company
must disclose in
writing to the company or request to have entered in the minutes of the
meetings of directors the nature and extent of that interest.
(2) The
disclosure required by subsection (1) must be made, in the case of a director,
                                (a)   at
the meeting of directors at which a proposed contract is first considered,
                                (b)   if
the director was not then interested in the proposed contract, at the first
meeting after the director becomes so interested,
                                (c)   if
the director becomes interested after a contract is made, at the first meeting
after the director becomes so interested, or
                                (d)   if
a person who is interested in a contract later becomes a director, at the first
meeting after that person becomes a director.
(3) The
disclosure required by subsection (1) must be made, in the case of an officer
who is not a director,
                                (a)   forthwith
after the officer becomes aware that a proposed contract is to be considered or
a contract has been considered at a meeting of directors,
                                (b)   if
the officer becomes interested after a contract is made, forthwith after the
officer becomes so interested, or
                                (c)   if
a person who is interested in a contract later becomes an officer, forthwith
after the person becomes an officer.
(4) If a material contract or proposed material
contract is one that, in the ordinary course of business of the provincial
company, would not require approval by the directors or the participating
policyholders and shareholders, a director or an officer referred to in
subsection (1) must disclose in writing to the company or request to have
entered in the minutes of meetings of directors the nature and extent of the
director’s or officer’s interest forthwith after the director or officer
becomes aware of the contract or proposed contract.
1999 cI‑5.1 s354
Voting
355(1) A director referred to in section 354(1) must
not be present or vote on any resolution to approve the contract unless the
contract is
                                (a)   an
arrangement by way of security for money lent to or obligations undertaken by
the director for the benefit of the provincial company or a subsidiary of the
company,
                                (b)   a
contract relating primarily to the director’s remuneration as a director or an
officer, employee or agent of the provincial company, a subsidiary of the
company, an entity controlled by the company or an entity in which the company
has a substantial investment,
                                (c)   a
contract for indemnity under section 365 or for insurance under section 366, or
                                (d)   a
contract with an affiliate of the provincial company.
(2) Any director who knowingly contravenes
subsection (1) ceases to hold office as director and is not eligible, for a
period of 5 years after the date on which the contravention occurred, for
election or appointment as a director of any financial institution that is
incorporated by or under an Act of the Legislature.
1999 cI‑5.1 s355
Continuing disclosure
356 For the purposes of section
354(1), a general notice to the directors by a director or an officer declaring
that the director or officer is a director or officer of an entity or has a
material interest in a person and is to be regarded as interested in any
contract made with that entity or person is a sufficient declaration of
interest in relation to any contract so made.
1999 cI‑5.1 s356
Avoidance standards
357 A material contract between a provincial
company and one or more of its directors or officers, or between a provincial
company and another entity of which a director or an officer of the company is
a director or an officer, or between a provincial company and a person in which
the director or officer has a material interest, is neither void nor voidable
                                (a)   by
reason only of that relationship, or
                                (b)   by
reason only that a director with an interest in the contract is present at or
is counted to determine the presence of a quorum at the meeting of directors or
the committee of directors that authorized the contract,
if the director or officer disclosed the interest in
accordance with section 354(2), (3) or (4) or section 356 and the contract was
approved by the directors or the participating policyholders and shareholders
and the contract was reasonable and fair to the company at the time it was
approved.
1999 cI‑5.1 s357
Application to Court
358 Where a director or an officer
of a provincial company fails to disclose an interest in a material contract in
accordance with sections 354 and 356, the Court may, on the application of the
company, a shareholder of the company or a participating policyholder, set
aside the contract on such terms as the Court thinks fit.
1999 cI‑5.1 s358
Liability and
Indemnification
Liability for
incorporation expenses
359(1) The directors of a provincial company who pay
incorporation or organization expenses from the capital of the company or from
interest on the capital without complying with section 140 are jointly and
severally liable to the shareholders or incorporators of the company for the
amount of those expenses.
(2) A director of a provincial company who has
satisfied a claim under this section is entitled to a contribution from the
other directors of the company who are liable for the claim.
1999 cI‑5.1 s359
Liability for other
matters
360(1) The directors of a provincial company who vote
for or consent to a resolution of the directors authorizing the issue of a
share in contravention of section 234(3) or the issue of subordinated
indebtedness in contravention of section 241 for a consideration other than
money are jointly and severally liable to the company to make good any amount
by which the consideration received is less than the fair equivalent of the
money that the company would have received if the share or subordinated
indebtedness had been issued for money on the date of the resolution.
(2) The
directors of a provincial company who vote for or consent to a resolution of
the directors authorizing
                                (a)   a
purchase, redemption or acquisition of shares in contravention of section 245,
246 or 247,
                                (b)   a
reduction of share capital in contravention of section 249,
                                (c)   a
payment of a dividend in contravention of section 253,
                                (d)   a
payment of an indemnity in contravention of section 365, or
                                (e)   any
transaction in contravention of Subpart 12,
are jointly and severally liable to restore to the company
any amounts so distributed or paid and not otherwise recovered by the company
and any amounts in relation to any loss suffered by the company.
1999 cI‑5.1 s360
Contribution
361(1) A director who has satisfied a judgment in
relation to the director’s liability under section 360 is entitled to
contribution from the other directors who voted for or consented to the
unlawful act on which the judgment was founded.
(2) A
director who is liable under section 360 is entitled to apply to the Court for
an order compelling a shareholder or other person to pay or deliver to the
director
                                (a)   any
money or property that was paid or distributed to the shareholder or other
person in contravention of section 245, 246, 247, 249, 253 or 365, or
                                (b)   an
amount equal to the value of the loss suffered by the provincial company as a
result of any transaction that contravenes Subpart 12.
(3) Where
an application is made to the Court under subsection (2), the Court may, where
it is satisfied that it is equitable to do so,
                                (a)   order
a shareholder or other person to pay or deliver to a director any money or
property that was paid or distributed to the shareholder or other person in
contravention of section 245, 246, 247, 249, 253 or 365 or any amount referred
to in subsection (2)(b),
                                (b)   order
a provincial company to return or issue shares to a person from whom the
company has purchased, redeemed or otherwise acquired shares, or
                                (c)   make any further order it thinks fit.
1999 cI‑5.1 s361
Limitation
362 An action to enforce a
liability imposed by section 360 must not be commenced after 2 years from the
date of the resolution authorizing the action complained of.
1999 cI‑5.1 s362
Liability for wages
363(1) Subject to subsections (2) and (3), the
directors of a provincial company are jointly and severally liable to each
employee of the company for all debts not exceeding 6 months’ wages payable to
the employee for services performed for the company while they are directors.
(2) A
director is not liable under subsection (1) unless
                                (a)   the
provincial company has been sued for the debt within 6 months after it has
become due and execution has been returned unsatisfied in whole or in part,
                                (b)   the
company has commenced liquidation and dissolution proceedings or has been
dissolved and a claim for the debt has been proven within 6 months after the
earlier of the date of commencement of the liquidation and dissolution
proceedings and the date of dissolution, or
                                (c)   a
winding‑up order has been issued in respect of the company under the Winding‑up and Restructuring Act
(Canada) and a claim for the debt has been allowed or proven within 6 months
after the issue of the winding‑up order.
(3) A
director is not liable under subsection (1) unless the director is sued for a
debt referred to in that subsection while a director or within 2 years after
the person has ceased to be a director.
(4) Where
execution referred to in subsection (2)(a) has issued, the amount recoverable
from a director is the amount remaining unsatisfied after execution.
(5) Where
a director of a provincial company pays a debt referred to in subsection (1)
that is proven in liquidation and dissolution or winding‑up proceedings,
the director is entitled to any preference that the employee would have been
entitled to and, where a judgment has been obtained, the director is entitled
to an assignment of the judgment.
(6) A director of a provincial company who has
satisfied a claim under this section is entitled to a contribution from the
other directors of the company who are liable for the claim.
1999 cI‑5.1 s363
Reliance on statement
364 A director, an officer or an employee of
a provincial company is not liable under section 310(1) or (3), 360 or 363 if
the director, officer or employee relies in good faith on
                                (a)   financial
statements of the company represented to the director, officer or employee by
an officer of the company or in a written report of the auditor of the company
to reflect fairly the financial condition of the company, or
                                (b)   a report of a professional advisor.
1999 cI‑5.1 s364
Indemnification of
directors and officers
365(1) Except in respect of an action by or on behalf
of the provincial company to procure a judgment in its favour, a provincial
company may indemnify
                                (a)   a
director or an officer of the company,
                                (b)   a
former director or officer of the company, or
                                (c)   any
person who acts or acted at the company’s request as a director or an officer of
an entity of which the company is or was a shareholder or creditor
against all costs,
charges and expenses, including an amount paid to settle an action or satisfy a
judgment reasonably incurred by the person in respect of any civil, criminal or
administrative action or proceeding to which the person is made a party by
reason of being or having been a person referred to in any of clauses (a) to
(c), if
                                (d)   the
director, officer or person acted honestly and in good faith with a view to the
best interests of the company, and
                                (e)   in
the case of a criminal or administrative action or proceeding enforced by a
monetary penalty, the director, officer or person had reasonable grounds for
believing that the impugned conduct was lawful.
(2) A
provincial company may, with the approval of the Court, indemnify a person
referred to in subsection (1) in respect of an action by or on behalf of the
company or entity to procure a judgment in its favour to which the person is
made a party by reason of being or having been a director or an officer of the
company or entity against all costs, charges and expenses, including an amount
paid to settle an action or satisfy a judgment, reasonably incurred by the
person in connection with that action if the person fulfils the conditions set
out in subsection (1)(d) and (e).
(3) Despite
anything in this section, a person referred to in subsection (1) is entitled to
indemnity from the provincial company in respect of all costs, charges and
expenses, including an amount paid to settle an action or satisfy a judgment,
reasonably incurred by the person in connection with the defence of any civil,
criminal or administrative action or proceeding to which the person is made a
party by reason of being or having been a director or an officer of the company
or an entity if the person seeking indemnity
                                (a)   was
substantially successful on the merits in the defence of the action or
proceedings, and
                                (b)   fulfils
the conditions set out in subsection (1)(d) and (e).
(4) A provincial company may, to the extent
referred to in subsections (1) to (3) in respect of the person, indemnify the
heirs or personal representatives of any person the company may indemnify
pursuant to subsections (1) to (3).
1999 cI‑5.1 s365
Directors’ and officers’ insurance
366 A provincial company may purchase and
maintain insurance for the benefit of any person referred to in section 365
against any liability incurred by the person
                                (a)   in
the capacity of a director or an officer of the company, except where the
liability relates to a failure to act honestly and in good faith with a view to
the best interests of the company, or
                                (b)   in the capacity of a director or an officer
of another entity where the person acts or acted in that capacity at the
company’s request, except where the liability relates to a failure to act
honestly and in good faith with a view to the best interests of the entity.
1999 cI‑5.1 s366
Application to Court for
indemnification
367(1) A provincial company or a person referred to in
section 365 may apply to the Court for an order approving an indemnity under
section 365(2) and the Court may so order and make any further order it thinks
fit.
(2) An
applicant under subsection (1) must give the Minister written notice of the
application and the Minister is entitled to appear and to be heard at the
hearing of the application in person or by counsel.
(3) On an application under subsection (1), the
Court may order notice to be given to any interested person and that person is
entitled to appear and to be heard at the hearing of the application in person
or by counsel.
1999 cI‑5.1 s367
Subpart 7
Insider Trading
Interpretation
368(1) In this Subpart,
                                (a)   “business
combination� means an acquisition of all or substantially all the assets of one
body corporate by another body corporate or an amalgamation of 2 or more bodies
corporate;
                                (b)   “insider�
means, with respect to a provincial company,
                                          (i)   the company,
                                         (ii)   an affiliate of the company,
                                        (iii)   a director or an officer of the company,
                                        (iv)   a person who has a substantial investment in the company,
                                         (v)   a person employed or hired by the company, and
                                        (vi)   a person who receives specific confidential information from a
person referred to in this clause, including a person referred to in this
subclause, and who has knowledge that the person giving the information is a
person described in this clause;
                                (c)   “officer�,
in relation to a provincial company, means
                                          (i)   a chief executive officer, president, vice‑president,
secretary, controller, treasurer and any other individual designated as an
officer of the company by bylaw or by resolution of the directors of the
company, and
                                         (ii)   any individual who performs functions for the company similar to
those performed by an individual referred to in subclause (i).
(2) For
the purposes of this Subpart,
                                (a)   if
a body corporate becomes an insider of a provincial company or enters into a
business combination with a provincial company, or
                                (b)   if
a provincial company becomes an insider of a body corporate, or enters into a
business combination with a body corporate,
every director or officer of the body corporate is deemed
to have been an insider of the company for the previous six months or for such
shorter period as the director or officer was a director or officer of the body
corporate.
1999 cI‑5.1 s368
Application
369 This Subpart applies to a
transaction in a security of a provincial company or any of its affiliates only
if the provincial company is not a reporting issuer.
1999 cI‑5.1 s369
Civil liability
370(1) An insider who, in connection with a
transaction in a security of the provincial company or any of its affiliates,
makes use of any specific confidential information for the insider’s own
benefit or advantage that, if generally known, might reasonably be expected to
affect materially the value of the security is
                                (a)   liable
to compensate any person for any direct loss suffered by that person as a
result of the transaction, unless the information was known or in the exercise
of reasonable diligence should have been known to that person at the time of
the transaction, and
                                (b)   accountable
to the company for any direct benefit or advantage received or receivable by
the insider as a result of the transaction.
(2) An action to enforce a right created by
subsection (1) must not be commenced after 2 years from discovery of the facts
that gave rise to the cause of action.
1999 cI‑5.1 s370
Subpart 8
Auditors
Definition
371 In this Subpart, “designated
individual� means the individual that is required to be designated by an
auditor under section 373.
1999 cI‑5.1 s371
Appointment of auditor
372(1) The shareholders and participating
policyholders of a provincial company must, by ordinary resolution at each
annual meeting of participating policyholders and shareholders, appoint a
person as auditor to hold office until the close of the next annual meeting.
(2) The remuneration of an auditor may be fixed by
ordinary resolution of the participating policyholders and shareholders but, if
not so fixed, must be fixed by the directors.
1999 cI‑5.1 s372
Designated individual
373 If the auditor of a provincial
company is not an individual, the auditor must designate an individual who is
responsible for acting on behalf of the auditor.
1999 cI‑5.1 s373
Qualifications of
auditor
374(1) The designated individual or individual who is
the auditor of a provincial company must
                                (a)   be
a member in good standing of an institute or association of accountants
incorporated by or under an Act,
                                (b)   have
at least 5 years’ experience in performing audits of a financial institution,
and
                                (c)   be
ordinarily resident in Canada.
(2) The
auditor of a provincial company, every partner in a firm that is the auditor of
a provincial company and the designated individual of an auditor must be
independent of the company.
(3) For
the purposes of subsection (2),
                                (a)   independence
is a question of fact, and
                                (b)   a
person is deemed not to be independent of a provincial company if that person
                                          (i)   is a director or an officer or employee of the company or of any
affiliate of the company or is a business partner of any director, officer or
employee of the company or of any affiliate of the company,
                                         (ii)   beneficially owns or controls, directly or indirectly, a material
interest in the shares of the company or of any affiliate of the company, or
                                        (iii)   has been a liquidator, trustee in bankruptcy, receiver or
receiver and manager of any affiliate of the company within the 2 years
immediately preceding the person’s or person’s firm’s proposed appointment as
auditor of the company or the individual’s proposed designation by the auditor,
other than an affiliate that is a subsidiary of the company acquired pursuant
to a loan workout or through a realization of security pursuant to section
421(2).
(4) No person is disqualified from acting as the
auditor of a provincial company or from being a designated individual solely on
the grounds that the person or, if the person is a firm, a partner of the firm
is a policyholder in the company.
1999 cI‑5.1 s374
Revocation of auditor’s appointment
375(1) The directors of a provincial company must
revoke the appointment of its auditor if
                                (a)   the
auditor no longer meets the requirements of section 374 and the auditor does
not resign, or
                                (b)   the
auditor’s designated individual no longer meets the requirements of section 374
and the auditor does not replace its designated individual with an individual
who meets the requirements of section 374.
(2) The
Minister may revoke the appointment of an auditor of a provincial company if
the Minister is satisfied that the auditor or the auditor’s designated
individual no longer meets the requirements of section 374.
(3) The
participating policyholders and shareholders of a provincial company may, by
ordinary resolution at a special meeting, revoke the appointment of an auditor.
(4) Nothing in this section permits the revocation
of the appointment of an auditor if the auditor was appointed by the Court,
unless the Court provides otherwise.
1999 cI‑5.1 s375
Declaration of vacancy
by Court
376 Any interested person may
apply to the Court for an order declaring that an auditor or its designated
individual no longer meets the requirements of section 374 and declaring the
office of auditor to be vacant.
1999 cI‑5.1 s376
Ceasing to hold office
377(1) The office of auditor of a provincial company
becomes vacant when
                                (a)   the
auditor resigns,
                                (b)   if
the auditor is an individual, the individual dies,
                                (c)   if
the auditor is not an individual, the auditor is dissolved,
                                (d)   the
appointment of the auditor is revoked, or
                                (e)   the
office of auditor is declared to be vacant under section 376.
(2) The resignation of an auditor becomes effective
at the time a written resignation is sent to the provincial company or at the
time specified in the resignation, whichever is later.
1999 cI‑5.1 s377
Filling vacancy
378(1) If the office of auditor of a provincial
company becomes vacant, the participating policyholders and shareholders or, if
the bylaws permit, the directors must forthwith fill the vacancy.
(2) An
auditor appointed under subsection (1) holds office for the unexpired term of
office of the predecessor auditor.
(3) If
a replacement auditor is not appointed in accordance with subsection (1), the
Court may appoint an auditor to hold office for the unexpired term of the
predecessor auditor and fix the remuneration of the auditor on the application
of
                                (a)   a
participating policyholder or shareholder of the provincial company, or
                                (b)   in addition to the persons referred to in
clause (a), the Executive Director under the Securities Act if the provincial company is a reporting issuer.
1999 cI‑5.1 s378
Statement of auditor
379(1) An auditor of a provincial company who
                                (a)   resigns,
                                (b)   receives
a notice or otherwise learns of a meeting of directors or participating policyholders
and shareholders called for the purpose of revoking the appointment of the
auditor, or
                                (c)   receives
a notice or otherwise learns of a meeting of directors or participating
policyholders and shareholders at which another person is to be appointed in
the auditor’s place, whether because of the auditor’s resignation or revocation
of appointment or because the auditor’s term of office has expired or is about
to expire,
must submit to the
company and the Minister a written statement giving the reasons for the
resignation or the reasons why, in the auditor’s opinion, the auditor’s
appointment is to be revoked or not renewed.
(2) If the reasons in the auditor’s statement are
based on a disagreement between the auditor and the directors or officers, the
provincial company must forthwith send a copy of the statement to each
participating policyholder and each voting shareholder.
1999 cI‑5.1 s379
Duty of replacement
auditor
380(1) Where an auditor of a provincial company has
resigned or the appointment of an auditor has been revoked, or where the
auditor’s term of office has expired or is about to expire and the auditor is
not to be reappointed, no person may accept an appointment or consent to be
appointed as auditor of the company until
                                (a)   the
person has requested and received from the predecessor auditor the written
statement under section 379(1), or
                                (b)   the
person has requested from the predecessor auditor the written statement under
section 379(1) and the person has not received the statement within 15 days
after making the request.
(2) If the predecessor auditor’s statement is not
received by the person who will be the replacement auditor within 15 days after
the request is made, the person must promptly notify the Minister and, if the
Minister has received the written statement, the Minister must provide it to
the person.
1999 cI‑5.1 s380
Right to attend meetings
381(1) The auditor of a provincial company is entitled
to receive reasonable notice of every meeting of participating policyholders or
shareholders, directors, audit committee and conduct review committee of the
company and, at the expense of the company, to attend and be heard at those
meetings on matters relating to the duties of the auditor.
(2) If
a director, participating policyholder or shareholder of a provincial company,
whether or not the shareholder is entitled to vote at the meeting, gives
written notice not less than 10 days before a meeting of participating
policyholders or shareholders to an auditor or former auditor of the provincial
company that the director, policyholder or shareholder wishes the auditor to
attend at the meeting, the auditor or former auditor must attend the meeting at
the expense of the company and answer questions relating to the auditor’s or
former auditor’s duties as auditor.
(3) An
auditor is not required to comply with subsection (2) where the audit committee
is satisfied that the request under subsection (2) is made primarily for the
purpose of enforcing a personal claim or redressing a personal grievance
against the provincial company or any of its directors, officers or security
holders, or for a purpose that is not related in any significant way to the
duties of the auditor.
(4) A
director, participating policyholder or shareholder who gives notice under
subsection (2) must send concurrently a copy of the notice to the provincial
company, and the company must forthwith send a copy of the notice to the
Minister regardless of any decision of the audit committee under subsection
(3).
(5) The Minister may attend and be heard at any
meeting referred to in subsection (2).
1999 cI‑5.1 s381
Right to information
382(1) On the request of the auditor of a provincial
company, the present or former directors, officers, employees or
representatives of the company and any former auditors of the company must, to
the extent that they are reasonably able to do so,
                                (a)   obtain
or permit access to such records, assets and security held by the company or
any entity in which the company has a substantial investment, and
                                (b)   provide
such information and explanations
as are, in the opinion
of the auditor, necessary to enable the auditor to perform the duties of
auditor of the company.
(2) A person who in good faith makes an oral or
written communication under subsection (1) is not liable in any civil action
arising from the communication’s having been made.
1999 cI‑5.1 s382
Auditor’s report
383(1) The auditor of a provincial company must make a
report in writing on the annual financial statement of the company at the annual
meeting of the participating policyholders and shareholders of the company.
(2) In
each report referred to in subsection (1), the auditor must include such
remarks as the auditor considers necessary when
                                (a)   the
auditor’s examination conducted to report on the annual financial statement has
not been made in accordance with the auditing standards referred to in section
219,
                                (b)   the
annual statement has not been prepared on a basis consistent with that of the
preceding financial year, or
                                (c)   the annual statement does not present
fairly, in accordance with the accounting principles referred to in section
219, the financial position of the provincial company as at the end of the
financial year to which it relates or the results of the operations or changes
in the financial position of the company for that financial year.
1999 cI‑5.1 s383
Requiring new financial
statements
384 If the Minister is satisfied that the
financial statements and reports of a provincial company that have been sent to
the Minister, policyholders, shareholders or the public were not prepared in
accordance with the standards set out in section 219, the Minister may require
the company
                                (a)   to
prepare new financial statements or reports that are prepared in accordance
with the standards set out in section 219, and
                                (b)   to send the new financial statements or
reports to the persons specified by the Minister.
1999 cI‑5.1 s384
Report on director’s statement
385(1) The auditor of a provincial company must, if
required by the participating policyholders and shareholders, audit and report
to them on any financial statement submitted to them by the directors, and the
report must state whether, in the auditor’s opinion, the financial statement
presents fairly the information required by the participating policyholders and
shareholders.
(2) A report of the auditor made under subsection
(1) must be attached to the financial statement to which it relates and a copy
of the statement and report must be sent by the directors to every participating
policyholder, to every shareholder and to the Minister.
1999 cI‑5.1 s385
Report to officers
386(1) The auditor of a provincial company must report
in writing to the audit committee of the company
                                (a)   any
material transactions or conditions affecting the well‑being of the
company that have come to the auditor’s attention and that in the auditor’s
opinion are not satisfactory and require rectification, or
                                (b)   any
material transaction that, in the auditor’s opinion, was not within the powers
of the company when the transaction occurred.
(2) An
auditor is not required to make a report under subsection (1) unless the
auditor becomes aware of the transactions or conditions in the ordinary course
of the auditor’s duties.
(3) If the auditor of a provincial company makes a
report under subsection (1), the auditor must also transmit the report, in
writing, to the chief executive officer and the actuary of the company and to
the Minister.
1999 cI‑5.1 s386
Auditor of subsidiaries
387 A provincial company must take all
necessary steps to ensure that its auditor or, with the permission of the
Minister, another auditor selected by the company, is duly appointed as the
auditor of each of its subsidiaries unless
                                (a)   in
the case of a subsidiary that carries on its operations in a country other than
Canada, the laws of that country do not permit the appointment of the auditor
of the provincial company as the auditor of that subsidiary, or
                                (b)   the provincial company’s auditor is of the
opinion that the total assets of the subsidiary are not a material part of the
total assets of the company.
1999 cI‑5.1 s387
Calling meeting
388(1) The auditor of a provincial company or a member
of the audit committee may call a meeting of the audit committee.
(2) The chief internal auditor of a provincial
company or any officer or employee of the company acting in a similar capacity
must, at the request of the auditor of the company and on reasonable notice,
meet with the auditor.
1999 cI‑5.1 s388
Notice of errors
389(1) A director or an officer of a provincial
company must forthwith notify the audit committee, the auditor and, if
applicable, a former auditor of the company of any error or misstatement of
which the director or officer becomes aware in an annual financial statement or
other statement on which the auditor or former auditor has reported.
(2) If
the auditor or a former auditor of a provincial company is notified or becomes
aware of an error or misstatement in an annual financial statement or other
statement on which the auditor or former auditor reported,
                                (a)   the
auditor must, if in the auditor’s opinion the error or misstatement is
material, inform each director of the company, the actuary, the former auditor,
if applicable, and the Minister, or
                                (b)   the
former auditor must, if in the former auditor’s opinion the error or
misstatement is material, inform each director of the company, the current
auditor and the Minister.
(3) Where
under subsection (2) the auditor or a former auditor of a provincial company
informs the directors of an error or misstatement in an annual financial
statement or other statement, the directors must
                                (a)   prepare
and issue a revised annual financial statement or other statement, or
                                (b)   inform the Minister and the participating
policyholders and shareholders of the company of the impact of the error or
misstatement.
1999 cI‑5.1 s389
Auditor’s report and extended examination
390(1) The Minister may, in writing, require that the
auditor of a provincial company report to the Minister on the extent of the
auditor’s procedures in the examination of the annual return and may, in
writing, require that the auditor enlarge or extend the scope of that
examination or direct that any other particular procedure be performed in any
particular case, and the auditor must comply with the requirement of the
Minister and report to the Minister.
(2) The
Minister may, in writing, require that the auditor of a provincial company make
a particular examination relating to the adequacy of the procedures adopted by
the company for the safety of its creditors, policyholders and shareholders, or
any other examination that, in the Minister’s opinion, the public interest may
require, and the auditor must comply with the requirement and report to the
Minister.
(3) The expenses incurred as a result of the
auditor’s performing duties under subsections (1) and (2) are payable by the
provincial company on being approved by the Minister.
1999 cI‑5.1 s390
Protection from
liability
391 An oral or written statement
or report made under this Act by the auditor or a former auditor of a
provincial company has qualified privilege.
1999 cI‑5.1 s391
Subpart 9
Actuaries
Definition
392 In this Subpart, “designated
individual� means the individual that is required to be designated by an
actuary under section 394.
1999 cI‑5.1 s392
Notice of appointment
393 A provincial company must,
forthwith after the directors appoint a person to be the actuary of the company
in accordance with section 309(2)(f), notify the Minister in writing of the
appointment.
1999 cI‑5.1 s393
Designated individual
394 If the actuary of a provincial
company is not an individual, the actuary must designate an individual who is
responsible for acting on behalf of the actuary.
1999 cI‑5.1 s394
Qualifications of
actuary
395(1) A designated individual or an individual who is
the actuary of a provincial life company must
                                (a)   be
ordinarily resident in Canada, and
                                (b)   be
a Fellow in good standing of the Canadian Institute of Actuaries.
(2) A
designated individual or an individual who is the actuary of a provincial
property and casualty company must
                                (a)   be
ordinarily resident in Canada, and
                                (b)   be a Fellow in good standing of the Canadian
Institute of Actuaries or be approved by the Minister as having the training
and experience that are relevant to the duties of an actuary of a provincial
company.
1999 cI‑5.1 s395
Certain officers
precluded
396(1) The chief executive officer or chief operating
officer or a person performing similar functions must not be appointed as or
hold the position of actuary of a provincial company unless authorized in
writing by the Minister.
(2) An authorization under subsection (1) ceases to
be in effect on the day specified in the authorization but not later than the
day that is 6 months after it is issued, and a person appointed or holding the
position of actuary pursuant to the authorization must not hold that position
after that day.
1999 cI‑5.1 s396
Chief financial officer
397(1) The chief financial officer or a person
performing similar functions must not be appointed as or hold the position of
actuary of a provincial company unless
                                (a)   the
audit committee of the company has provided the Minister with a written
statement indicating that it is satisfied that the duties of both positions in
the company will be adequately performed and that the actuarial duties will be
performed in an independent manner, and
                                (b)   the
appointment or holding of the position is authorized by the Minister.
(2) An
authorization under subsection (1)(b) may contain limitations and conditions,
including a limitation on the time during which the person referred to in the
authorization may hold the position of actuary of the provincial company.
(3) A person holding the position of actuary
pursuant to an authorization under subsection (1)(b) must not hold that
position after the time limit referred to in subsection (2).
1999 cI‑5.1 s397
Revocation of actuary’s appointment
398(1) The directors of a provincial company may
revoke the appointment of the actuary of the company.
(2) The
directors of a provincial company must revoke the appointment of its actuary if
                                (a)   the
actuary no longer meets the requirements of section 395 and does not resign, or
                                (b)   the
actuary’s designated individual no longer meets the requirements of section 395
and the actuary does not replace its designated individual with an individual
who meets the requirements of section 395.
(3) The
Minister may revoke the appointment of an actuary of a provincial company if
the Minister is satisfied that the actuary or the actuary’s designated
individual no longer meets the requirements of section 395.
(4) Nothing in this section permits the revocation
of the appointment of an actuary if the actuary was appointed by the Court
unless the Court provides otherwise.
1999 cI‑5.1 s398
Declaration of vacancy
by Court
399 Any interested person may
apply to the Court for an order declaring that an actuary or its designated
individual no longer meets the requirements of section 395 and declaring the
office of actuary to be vacant.
1999 cI‑5.1 s399
Ceasing to hold office
400(1) The office of actuary of a provincial company
becomes vacant when
                                (a)   the
actuary resigns,
                                (b)   if
the actuary is an individual, the individual dies,
                                (c)   if
the actuary is not an individual, the actuary is dissolved,
                                (d)   the
appointment of the actuary is revoked, or
                                (e)   the
office of actuary is declared to be vacant under section 399.
(2) The resignation of an actuary becomes effective
at the time a written resignation is sent to the provincial company or at the
time specified in the resignation, whichever is later.
1999 cI‑5.1 s400
Filling vacancy
401 When a vacancy occurs in the office of
actuary of a provincial company, the directors must forthwith
                                (a)   submit
a written statement to the Minister of the circumstances and reasons why, in
the directors’ opinion, the office of actuary became vacant, and
                                (b)   fill the vacancy.
1999 cI‑5.1 s401
Statement of actuary
402 An actuary of a provincial company who
resigns or whose appointment is revoked must submit a written statement of the
circumstances and reasons why the actuary resigned or why, in the actuary’s
opinion, the actuary’s appointment was revoked to
                                (a)   the
directors of the company,
                                (b)   the
Minister, and
                                (c)   the replacement actuary of the company when
a request for the statement is made by the replacement actuary.
1999 cI‑5.1 s402
Duty of replacement
actuary
403(1) If an actuary of a provincial company has
resigned or the appointment of an actuary has been revoked, the replacement
actuary must promptly after being appointed request the previous actuary to
provide the replacement actuary with a copy of the statement referred to in
section 402.
(2) If the replacement actuary does not receive the
statement within 15 days after making the request, the replacement actuary must
promptly notify the Minister that the statement has not been received and, if
the Minister has received the statement, the Minister must provide it to the
actuary.
1999 cI‑5.1 s403
Right to information
404(1) On the request of the actuary of a provincial
company, the present or former directors, officers, employees or
representatives of the company, any former actuary of the company and of any of
the company’s subsidiaries and holding bodies corporate must, to the extent
that they are reasonably able to do so,
                                (a)   obtain
or permit access to such records held by the company or any of its subsidiaries
or holding bodies corporate, and
                                (b)   provide
such information and explanations
as are, in the opinion
of the actuary, necessary to enable the actuary to perform the duties of
actuary of the company.
(2) A person who in good faith makes an oral or
written communication under subsection (1) is not liable in any civil action
arising from having made the communication.
1999 cI‑5.1 s404
Actuary’s valuation
405(1) The actuary of a provincial company must value
                                (a)   the
actuarial and other policy liabilities of the company as at the end of a
financial year, and
                                (b)   any
other matter specified in any direction made by the Minister.
(2) An actuary who is a Fellow of the Canadian
Institute of Actuaries must ensure that the valuation is in accordance with
generally accepted actuarial practices with any modification established by the
Minister under section 219.
1999 cI‑5.1 s405
Special valuation
406(1) The Minister may appoint an individual as an
actuary to value the matters referred to in section 405(1)(a) or (b) in
relation to a provincial company if the Minister is of the opinion that the
appointment is necessary.
(2) The remuneration and expenses incurred in
carrying out a valuation under subsection (1) are payable by the provincial
company on being approved by the Minister.
1999 cI‑5.1 s406
Actuary’s report
407(1) The actuary of a provincial company must, not
less than 21 days before the date of the annual meeting of the participating
policyholders and shareholders of the company, make a report to them on the
valuation made under section 405 and on any other matter that is prescribed.
(2) In each report required under subsection (1),
the actuary must state whether, in the actuary’s opinion, the annual statement
presents fairly the results of the valuation made under section 405.
1999 cI‑5.1 s407
Report to directors
408(1) The directors of the company or, where the
directors so choose, the audit committee of the company must meet with the
actuary of a provincial company at least once during each financial year.
(2) The
actuary must report at the meeting
                                (a)   on
the financial position of the provincial company, and
                                (b)   if directed to do so by the Minister, the
expected future financial condition of the company.
1999 cI‑5.1 s408
Report on matters
requiring rectification
409 The actuary of a provincial
company must report in writing to the directors, chief executive officer and chief
financial officer of the company and to the Minister any matters that have come
to the actuary’s attention in the course of carrying out the actuary’s duties
and that in the actuary’s opinion have material adverse effects on the
financial condition of the company and require rectification.
1999 cI‑5.1 s409
Actuary’s procedures
410(1) The Minister may, in writing, require that the
actuary of a provincial company report to the Minister on the extent of the
actuary’s procedures used in valuing the actuarially based liability figures
contained in the annual return and may, in writing, require that the actuary
enlarge or extend the scope of that valuation or direct that any other
particular procedure be performed in any particular case, and the actuary must
comply with the requirement of the Minister and report to the Minister.
(2) The expenses incurred as a result of the
actuary’s performing duties under subsection (1) are payable by the provincial
company on being approved by the Minister.
1999 cI‑5.1 s410
Protection from
liability
411(1) An oral or written statement or report made
under this Act by the actuary or former actuary of a provincial company has
qualified privilege.
(2) The actuary or former actuary of a company who
in good faith makes an oral or written statement or report under section 402 or
409 is not liable in any civil action for damages attributable to the actuary’s
or former actuary’s having made the statement or report.
1999 cI‑5.1 s411
Regulations
412 The Lieutenant Governor in Council
may make regulations providing for matters to be included in an actuary’s
report under section 407.
1999 cI‑5.1 s412
Subpart 10
Adequacy of Assets, Capital
and Liquidity
413 Repealed RSA 2000 cI‑3 s873.
Capital
and liquidity
414(1) This section comes into force when section 413
is repealed.
(NOTE:Â Â Section 413
proclaimed repealed November 26, 2003.)
(2) A
provincial company must, in relation to its operations,
                                (a)   maintain
adequate capital and adequate and appropriate forms of liquidity, and
                                (b)   comply
with any regulations in relation to capital and liquidity.
(3) The
Lieutenant Governor in Council may make regulations respecting the maintenance
by provincial companies of
                                (a)   adequate
capital, and
                                (b)   adequate
and appropriate forms of liquidity.
(4) The
regulations may specify different requirements for different classes of
provincial companies.
(5) Even
though a provincial company is complying with regulations made under subsection
(3), the Minister may, by order, direct the company
                                (a)   to
increase its capital, or
                                (b)   to
provide additional liquidity in the forms and amounts that the Minister
requires.
(6) A provincial company must comply with an order
made under subsection (5) within the time the Minister specifies in the order.
1999 cI‑5.1 s414
Subpart 11
Investments
Definitions
415 In this Subpart,
                                (a)   “commercial
loan� means
                                          (i)   any loan other than
                                                (A)   loans to an individual in an aggregate
prescribed amount or less,
                                                 (B)   a loan to the government of Canada or a
province or territory, a municipality or any of their agencies, or to the
government of a foreign country or any of its agencies, or to a prescribed
international agency,
                                                 (C)   a loan that is guaranteed by, or fully
secured by securities issued by, a government, a municipality or an agency
referred to in paragraph (B),
                                                 (D)   a loan that is secured by a mortgage on real
property
                                                           (I)   where the mortgage is on residential
property and the amount of the loan, together with the amount then outstanding
of any mortgage having an equal or prior claim against the property, does not
exceed 75% of the value of the property at the time the loan is made, or
                                                          (II)   where the mortgage is on real property other
than residential property and the amount of the loan, together with the amount
then outstanding of any mortgage having an equal or prior claim against the
property, does not exceed 75% of the value of the property at the time the loan
is made and the property provides an annual income sufficient to pay all annual
expenses related to the property, including the payments owing under the
mortgage and the mortgages having an equal or prior claim against the property,
                                                 (E)   a loan that is secured by a mortgage on real
property where the amount of the loan, together with the amount then outstanding
of any mortgage having an equal or prior claim against the property, exceeds
75% of the value of the property at the time the loan is made if repayment of
the amount of the loan that exceeds 75% of the value of the property is
guaranteed or insured by an insurer approved by the Minister or a government
agency, or
                                                 (F)   a loan that
                                                           (I)   is fully secured by a deposit with any
deposit‑taking institution,
                                                          (II)   is fully secured by debt obligations that
are guaranteed by any financial institution other than the provincial company
or an affiliate of the company, or
                                                         (III)   is fully secured by a guarantee of a
financial institution other than the provincial company or an affiliate of the
company,
                                                     or
                                                 (G)   an advance on the security of or against the
cash surrender value of a policy,
                                         (ii)   an investment in debt obligations, other than
                                                (A)   debt obligations that are
                                                           (I)   guaranteed by any financial institution
other than the provincial company or an affiliate of the company,
                                                          (II)   fully secured by deposits with any deposit‑taking
institution, or
                                                         (III)   fully secured by debt obligations that are
guaranteed by any financial institution other than the provincial company or an
affiliate of the company,
                                                 (B)   debt obligations that are issued by the
government of Canada or a province or territory, a municipality or any of their
agencies, or by the government of a foreign country or any of its agencies, or
by a prescribed international agency,
                                                 (C)   debt obligations that are guaranteed by, or
fully secured by securities issued by, a government, a municipality or an
agency referred to in paragraph (B), or
                                                 (D)   debt obligations that are widely
distributed,
                                        (iii)   an investment in shares of a body corporate or ownership
interests in an unincorporated body, other than
                                                (A)   shares or ownership interests that are
widely distributed, or
                                                 (B)   participating shares,
                                            and
                                        (iv)   any other prescribed form of financing,
                                         but does not include a
deposit with a deposit‑taking institution;
                                         (v)   repealed 2003 c19 s34;
                                (b)   “connected�
means connected as defined in the regulations;
                                (c)   “debt
obligation� means a bond, debenture, note or other evidence of indebtedness,
whether secured or unsecured;
                                (d)   “investment�
includes a loan to a person;
                                (e)   “loan�
includes an acceptance, an advance on the security of or against the cash
surrender value of a policy, endorsement, letter of credit or other guarantee,
a financial lease, a conditional sales contract, a repurchase agreement and any
other similar arrangement for obtaining funds or credit, but does not include
investments in securities;
                                 (f)   “participating
share� means a share of a body corporate that carries the right to participate
in the earnings of the body corporate to an unlimited degree and to participate
in a distribution of the remaining property of the body corporate on
dissolution;
                                (g)   “widely
distributed� with respect to securities of a body corporate means
                                          (i)   securities issued by way of a prospectus and traded on a
recognized stock exchange, or
                                         (ii)   securities issued to more than 25 investors
within a 6‑month period, no one of which holds more than 10% of the total
amount of the securities issued and of which, on an ongoing basis, the body
corporate does not own more than 10% of the securities outstanding.
RSA 2000 cI‑3
s415;2003 c19 s34
Prudent investment
standards
416(1) A provincial company must adhere to prudent
investment standards in making investment decisions and in managing its total
investments.
(2) For
the purposes of this Act, prudent investment standards are those which, in the
overall context of an investment portfolio, a reasonable and prudent person
would apply to investments made on behalf of another person with whom there
exists a fiduciary relationship to make such investments without undue risk of
loss or impairment and with a reasonable expectation of fair return or
appreciation.
(3) The fact that a provincial company is in
compliance with the other provisions of this Act relating to investments does
not of itself mean that the company is in compliance with subsection (1).
1999 cI‑5.1 s416
Policies and procedures
417(1) The directors of a provincial company must
establish policies and procedures to ensure that the company applies prudent
investment standards in making investment decisions and in managing its total
investments.
(2) The directors must review the procedures
established under subsection (1) at least once each year.
1999 cI‑5.1 s417
Prohibited investments
418(1) No provincial company may directly or
indirectly make loans to or other investments in
                                (a)   any
person, or
                                (b)   any
2 or more persons that to the knowledge of the company are connected,
if the outstanding
balance of principal and interest of loans for the person or the connected
persons, together with the book value of investments in the person or connected
persons, would exceed $500 000 or the prescribed percentage of the
company’s assets, whichever is greater.
(2) This
section does not apply so as to restrict a provincial company from acquiring or
making investments in
                                (a)   a
security issued or guaranteed by the government of Canada or any province or
territory,
                                (b)   a
mortgage that is
                                          (i)   insured under the National
Housing Act (Canada) or through an agency of the government of Canada or a
province or territory, or
                                         (ii)   insured by an insurer approved by the Minister,
                                (c)   an
unincorporated body referred to in section 420(2),
                                (d)   a
body corporate referred to in section 421(3), or
                                (e)   other prescribed investments.
1999 cI‑5.1 s418
Restriction on
residential mortgages
419(1) No provincial company may make a loan in Canada
on the security of residential property in Canada for the purpose of
purchasing, renovating or improving that property, or refinance such a loan, if
the amount of the loan, together with the amount then outstanding of mortgages
having an equal or prior claim against the property, would exceed 75% of the
value of the property at the time of the loan.
(2) Subsection
(1) does not apply in respect of
                                (a)   a
loan if repayment of the amount of the loan that exceeds the maximum set out in
subsection (1) is guaranteed or insured by the Government of Alberta, the
Government of Canada, the government of another province or territory, an
agency of any of those governments or an insurance policy issued by a licensed
insurer;
                                (b)   the
acquisition by the company from an entity of securities issued or guaranteed by
the entity that are secured on any residential property, whether in favour of a
trustee or otherwise, or the making of a loan by the company to the entity
against the issue of such securities, or
                                (c)   a
loan secured by a mortgage where
                                          (i)   the mortgage is taken back by the company on a property disposed
of by the company, including where the disposition is by way of a realization
of a security interest, and
                                         (ii)   the mortgage secures payment of an amount
payable to the company for the property.
1999 cI‑5.1 s419
Limitation on ownership
of unincorporated body
420(1) Subject to subsections (2) and (4), no
provincial company may beneficially own more than a 10% interest in an unincorporated
body.
(2) Subsection
(1) does not apply where the unincorporated body is carrying on a business that
may be carried on by a body corporate referred to in section 421(3) and is
carrying on that business in the same way as if it were such a body corporate.
(3) For
the purposes of subsection (1), an interest beneficially owned by a subsidiary
of a provincial company is deemed to be beneficially owned by the company.
(4) Despite
subsection (1), a provincial company may, through realization of a security
interest held by the company or, subject to the approval of the Minister, by
means of a loan workout procedure, beneficially own more than a 10% interest in
an unincorporated body, but the company must dispose of the excess interest
within
                                (a)   two
years after acquiring the excess interest, or
                                (b)   any longer period the Minister allows.
1999 cI‑5.1 s420
Limitation on
shareholding
421(1) Subject to this section and except as otherwise
prescribed, no provincial company may have a substantial investment in a body
corporate.
(2) Despite
subsection (1), a provincial company may, through realization of a security
interest held by the company or, subject to the approval of the Minister, by
means of a loan workout procedure, have a substantial investment in a body
corporate, but the company must dispose of the excess shares that give the
company a substantial investment within
                                (a)   two
years after acquiring the excess shares, or
                                (b)   any
longer period the Minister allows.
(3) Despite
subsections (1) and (2) and except as otherwise prescribed, a provincial
company may have a substantial investment in any of the following bodies
corporate:
                                (a)   a
bank;
                                (b)   a
loan corporation or trust corporation incorporated by or under an Act of Canada
or a province or territory;
                                (c)   with
the approval of the Minister, an extra‑provincial company or an insurer
formed by or under an Act of Canada;
                                (d)   with
the approval of the Minister, a foreign financial institution;
                                (e)   a
prescribed body corporate.
(4) A provincial company must not have a
substantial investment in a body corporate referred to in subsection (3) if
that body corporate has a substantial investment in another body corporate that
is not a body corporate referred to in subsection (3).
1999 cI‑5.1 s421
Duty to provide
information
422 If a provincial company
acquires control of an unincorporated body referred to in section 420(2), or of
a body corporate referred to in section 421(3), the provincial company must
provide the Minister with any information respecting the unincorporated body or
body corporate that the Minister requires.
1999 cI‑5.1 s422
Divestment order
423(1) If a provincial company beneficially owns an
interest in an unincorporated body referred to in section 420(2) and
                                (a)   the
unincorporated body is carrying on business in an unsound manner that may
imperil the company’s investment if continued, or
                                (b)   in
the case of an unincorporated body that is controlled by the company, the
company fails to provide information to the Minister under section 422,
the Minister may, by
order, direct the company to divest itself of all or part of its beneficial
ownership within the time specified in the order.
(2) If
a provincial company beneficially owns shares in a body corporate referred to
in section 421(3) and
                                (a)   the
body corporate is carrying on business in an unsound manner that may imperil
the company’s investment if continued, or
                                (b)   in
the case of a body corporate that is a subsidiary, the company fails to provide
information to the Minister under section 422,
the Minister may, by order, direct the company to divest
itself of all or part of its beneficial ownership within the time specified in
the order.
1999 cI‑5.1 s423
Portfolio Limits
Exclusion from portfolio
limits
424(1) Subject to subsection (3), the value of all
investments acquired by a provincial company and any of its subsidiaries as a
result of a realization of a security interest must not be included in
calculating the value of the investments of the company and its subsidiaries
under sections 425 to 430
                                (a)   for
a period of 7 years following the day on which the interest was acquired, in
the case of an interest in real property, and
                                (b)   for
a period of 2 years following the day on which the investment was acquired, in
the case of an investment other than an interest in real property.
(2) The
Minister may, in the case of any particular provincial company, extend any
period referred to in subsection (1) for such further period or periods, and on
such terms and conditions, as the Minister considers necessary.
(3) Subsection (1) does not apply to interests in
real property that are prescribed for the purposes of this subsection.
1999 cI‑5.1 s424
Lending limit - life
companies
425(1) Subject to subsection (2), a provincial life
company must not, and must not permit its subsidiaries to,
                                (a)   make
or acquire a commercial loan, or
                                (b)   acquire
control of a body corporate referred to in section 421(3) that holds commercial
loans,
if the aggregate value
of all commercial loans held by the company and its subsidiaries exceeds, or if
the making or acquisition of the commercial loan or the acquisition of control
of the body corporate would cause the aggregate value of all commercial loans
held by the company and its subsidiaries to exceed, 5% of the total assets of
the company.
(2) A
provincial life company that has more than $15 000 000 of base
capital may, with the prior approval of the Minister,
                                (a)   make
or acquire commercial loans, or
                                (b)   acquire control of a body corporate referred
to in section 421(3) that holds commercial loans.
1999 cI‑5.1 s425
Lending limit - property
and casualty companies
426 A provincial property and casualty
company must not, and must not permit its prescribed subsidiaries to,
                                (a)   make
or acquire a commercial loan or a loan to an individual, or
                                (b)   acquire
control of a body corporate referred to in section 421(3) that holds commercial
loans or loans to individuals
if the aggregate value of all such loans held by the
company and its prescribed subsidiaries exceeds, or if the making or
acquisition of the loan or the acquisition of control of the body corporate
would cause the aggregate value of all such loans held by the company and its
prescribed subsidiaries to exceed, 5% of the total assets of the company.
1999 cI‑5.1 s426
Limit on real property
interest
427 A provincial company must not, and must
not permit its prescribed subsidiaries to,
                                (a)   purchase
or otherwise acquire an interest in real property, or
                                (b)   make
an improvement to any real property in which the company or any of its
prescribed subsidiaries has an interest,
if the aggregate value of all of the company’s interests in
real property exceeds, or if the acquisition of the interest or the making of
the improvement would cause that aggregate value to exceed, 10% of the total
assets of the company and its prescribed subsidiaries.
1999 cI‑5.1 s427
Limits on equity
acquisitions
428 A provincial company must not, and must
not permit its prescribed subsidiaries to,
                                (a)   purchase
or otherwise acquire any participating shares of any body corporate or any
ownership interests in any unincorporated body, other than those in which the
company has, or by virtue of the acquisition would have, a substantial
investment, or
                                (b)   acquire
control of a body corporate that holds shares or ownership interests referred
to in clause (a),
if the aggregate value
of
                                (c)   all
participating shares, excluding participating shares of bodies corporate
referred to in section 421(3) in which the company has a substantial
investment, and
                                (d)   all
ownership interests in unincorporated bodies
beneficially owned by the company and its prescribed
subsidiaries exceeds, or if the purchase or acquisition would cause that
aggregate value to exceed, the prescribed percentage of the total assets of the
company and its prescribed subsidiaries.
1999 cI‑5.1 s428
Aggregate limit
429 A provincial company must not, and must
not permit its prescribed subsidiaries to,
                                (a)   purchase
or otherwise acquire
                                          (i)   participating shares of a body corporate, other than those of a
body corporate referred to in section 421(3) in which the company has, or by
virtue of the acquisition would have, a substantial investment,
                                         (ii)   ownership interests in an unincorporated body, or
                                        (iii)   interests in real property,
                                    or
                                (b)   make
an improvement to real property in which the company or any of its prescribed
subsidiaries has an interest
if the aggregate value
of
                                (c)   all
participating shares and ownership interests referred to in clause (a)(i) and
(ii) that are beneficially owned by the company and its prescribed
subsidiaries, and
                                (d)   all
of the company’s interests in real property referred to in clause (a)(iii)
exceeds, or if the acquisition of the shares or interests
or the making of the improvement would cause that aggregate value to exceed,
30% of the total assets of the company and its prescribed subsidiaries.
1999 cI‑5.1 s429
Assets transactions
430 A provincial company must not,
without the approval of the Minister, in any transaction or series of
transactions with the same party during a period of 12 months, acquire or
dispose of assets, directly or indirectly, other than assets that are debt
obligations referred to in section 415(a)(ii)(A) to (D), having a value in
excess of 10% of the total assets of the company as at the beginning of the 12‑month
period.
1999 cI‑5.1 s430
Retaining investments
431(1) If a provincial company has acquired on or
before December 31, 1996 an investment that was allowed under the Insurance Act in force at the time of
acquisition, but that is not permitted under this Act and the regulations, the
company may retain the investment.
(2) A provincial company that has an investment
referred to in subsection (1) must not increase the amount of or renew or
extend the investment without the prior consent of the Minister.
1999 cI‑5.1 s431
Regulations
432 The Lieutenant Governor in Council may
make regulations
                                (a)   defining
terms that are specified in section 415 as being defined in the regulations;
                                (b)   defining
interests in real property for the purposes of one or more provisions of this
Subpart and determining the method of valuating those interests;
                                (c)   prescribing
quantitative limits on investments that may be made by a provincial company or
its subsidiary, including quantitative limits on investments referred to in
section 421(3) and, where a limit has been imposed by this Act, prescribing
limits that are more restrictive;
                                (d)   imposing
terms and conditions subject to which a provincial company or its subsidiary
may make investments or enter into other transactions, and imposing
restrictions on the manner in which investments and other transactions may be
made, given or entered into;
                                (e)   prescribing
investments and other transactions that a provincial company or its subsidiary
must not make, give or enter into;
                                 (f)   respecting
the method to be used to value the assets of a provincial company for the
purposes of this Act;
                                (g)   respecting any matter that is to be
prescribed under this Subpart.
1999 cI‑5.1 s432
Subpart 12
Transactions with Related Parties
Interpretation
433(1) In this Subpart,
                                (a)   “fundamentally
reinsure� with respect to a contract of insurance means
                                          (i)   that the insurer under the contract transfers or assigns all
rights and obligations under the contract to another insurer, or
                                         (ii)   that the contract is replaced by novation and the insurer under
the replacement contract is different from the insurer under the original
contract;
                                (b)   “loan�
includes a deposit, a financial lease, a conditional sales contract, a
repurchase agreement and any other similar arrangement for obtaining funds or
credit, but does not include investments in securities or the making of an
acceptance, endorsement or other guarantee;
                                (c)   “senior
official� of a body corporate means an individual who
                                          (i)   is a director and a full‑time employee of the body
corporate,
                                         (ii)   is an officer or the chief operating officer, chief financial
officer, chief accountant, chief auditor or chief actuary of the body
corporate,
                                        (iii)   performs functions for the body corporate similar to those
performed by an official referred to in subclause (ii),
                                        (iv)   is the head of the strategic planning unit of the body corporate,
                                         (v)   is the head of the unit of the body corporate that provides legal
services or human resources services to the body corporate,
                                        (vi)   is an official who reports directly to the body corporate’s board
of directors, chief executive officer or chief operating officer, or
                                       (vii)   is prescribed.
(2) A
transaction, guarantee or investment is made or entered into if an existing
transaction, guarantee or investment, including one made or entered into before
the coming into force of this section, is modified, added to, extended or
renewed.
(3) Where
a transaction is required by or under this Subpart to be at fair market rate,
that requirement is satisfied, subject to subsection (4), if the transaction is
not at fair market rate but is at a rate and terms that are more financially
advantageous to the provincial company or subsidiary than actual fair market
rate.
(4) Subsection
(3) does not apply where the transaction is between
                                (a)   a
provincial company and its affiliate, or
                                (b)   a subsidiary of a provincial company and an
affiliate of the provincial company.
1999 cI‑5.1 s433
Meaning of related party
434(1) For the purposes of this Subpart, a person is a
related party of a provincial company if the person
                                (a)   has
a significant interest in a class of shares of the company,
                                (b)   is
a director or senior official of the company or of a body corporate that
controls the company or is acting in a similar capacity in respect of an
unincorporated body that controls the company,
                                (c)   is
the spouse or adult interdependent partner, or a child who is less than 18
years of age, of a person described in clause (a) or (b),
                                (d)   is
an entity that is controlled by a person referred to in any of clauses (a) to
(c),
                                (e)   is
an unincorporated body in which the company beneficially owns more than a 10%
interest,
                                 (f)   is
a body corporate in which the company has a substantial investment,
                                (g)   is
an entity in which a person who controls the company has a substantial
investment,
                                (h)   is
an entity in which the spouse or adult interdependent partner, or a child who
is less than 18 years of age, of a person who controls the company has a
substantial investment, or
                                 (i)   is
designated under section 435 as a related party.
(2) Unless
the regulations provide otherwise, the following are not a related party of a
provincial company:
                                (a)   a
financial institution that wholly owns the company;
                                (b)   a
wholly owned subsidiary of the company.
(3) Where the Minister is satisfied that a
subsidiary of a provincial company that is not a wholly owned subsidiary of the
company functions primarily for the purpose of providing a service, other than
a financial service, to the company or the company’s subsidiaries, the Minister
may, on application, exempt the subsidiary from the status of related party of
the company, subject to any terms and conditions the Minister considers
appropriate.
RSA 2000 cI‑3
s434;2002 cA‑4.5 s45
Designated related party
435 For the purposes of this Subpart, the
Minister may designate any person as a related party of a provincial company if
the Minister is of the opinion that
                                (a)   the
person is acting or has acted jointly or in concert with a related party of the
company with respect to entering into a transaction that would be prohibited or
restricted under this Subpart if entered into by or with respect to that
related party,
                                (b)   there
exists or has existed between the person and the company an interest or
relationship that might reasonably be expected to affect or that has affected
the exercise by the company of its best judgment with respect to a transaction,
or
                                (c)   the person is acting in concert with one or
more other persons to own or control, directly or indirectly, 10% or more of
any class of voting shares of the company.
1999 cI‑5.1 s435
Transactions
contemplating related party status
436 If a person who, but for this
section, is not a related party enters into a transaction with a provincial company
or its subsidiary knowing that the person is going to become a related party of
the company, the person is a related party of the company with respect to that
transaction.
1999 cI‑5.1 s436
Prohibited transactions,
guarantees and investments
437 Except as provided in this Subpart,
                                (a)   no
provincial company or subsidiary of a provincial company may, directly or
indirectly, enter into any transaction with a related party of the company,
                                (b)   no
related party of a provincial company may, directly or indirectly, enter into
any transaction with the company or its subsidiary,
                                (c)   no
provincial company or subsidiary of a provincial company may, directly or
indirectly, enter into any guarantee on behalf of a related party of the
company, and
                                (d)   no provincial company or subsidiary of a
provincial company may, directly or indirectly, make an investment in or take a
security interest in any securities of a related party of the company.
1999 cI‑5.1 s437
Exceptions to the
prohibition
438 This Subpart does not apply in respect of
                                (a)   the
granting of indemnification in accordance with section 365,
                                (b)   the
issue by the provincial company of shares of any class when fully paid for in
money or when issued
                                          (i)   in accordance with any provisions for the conversion of other
issued and outstanding securities of the company into shares of that class,
                                         (ii)   as a share dividend,
                                        (iii)   in exchange for shares of a body corporate that has been
continued as a provincial company under Subpart 2,
                                        (iv)   in accordance with the terms of an amalgamation under Subpart 2,
                                         (v)   by way of consideration in accordance with the terms of an
agreement referred to in Subpart 2, Division 10 in which the provincial company
agrees to sell all or substantially all of its assets, or
                                        (vi)   with the approval of the Minister, in exchange for shares of
another body corporate,
                                (c)   the
payment of dividends or policy dividends or bonuses, or
                                (d)   transactions that consist of the payment or
provision by a provincial company of salaries, fees, stock options, policy
premiums, pension benefits, incentive benefits or other benefits or
remuneration to persons who are related parties of the company in their
capacity as directors, officers or employees of the company.
1999 cI‑5.1 s438
Permitted transactions
439(1) A provincial company or a subsidiary of a
provincial company may
                                (a)   enter
into a transaction with a related party that involves minor or general
expenditures by the company or the subsidiary,
                                (b)   enter
into a transaction with a related party for
                                          (i)   the sale of goods, or
                                         (ii)   the provision of financial services
                                         that are normally sold or
provided to the public by the company or the subsidiary in the ordinary course
of business, so long as the prices and rates charged by the company or subsidiary
are at fair market rate,
                                (c)   enter
into a transaction with a related party that is a financial institution if
                                          (i)   the transaction consists of a deposit made at fair market rate
and for a prescribed purpose, or
                                         (ii)   the transaction consists of the acquisition at fair market rate
of prescribed securities from a securities dealer who is not an underwriter,
within the meaning of that term in the Securities
Act, in the distribution of those securities and is not selling them as
their principal,
                                    and
                                (d)   make
a loan or give a guarantee on behalf of a senior official of the company or
subsidiary if the aggregate of the outstanding principal and interest owing on
all such loans and the contracted amount of all outstanding guarantees to or on
behalf of that senior official does not exceed the lesser of
                                          (i)   $100 000, and
                                         (ii)   twice the annual salary of that senior official.
(2) The
conduct review committee of a provincial company must, subject to any
prescribed limits, develop criteria as to what constitutes minor or general
expenditures for the purposes of subsection (1)(a).
(3) A
provincial company may, subject to Subpart 2, fundamentally reinsure its
contracts of insurance with a related party of the company.
(4) A
related party of a provincial company may, subject to Subpart 2, fundamentally
reinsure its contracts of insurance with the company.
(5) A
provincial company may reinsure a contract of insurance in the ordinary course
of its business with a related party of the company in accordance with section
62.
(6) A
provincial company may accept or retain on the direction of a policyholder or
beneficiary who is a related party amounts that are payable as
                                (a)   policy
dividends or bonuses, or
                                (b)   policy
proceeds on the surrender or maturity of the policy or on the death of the
person whose life is insured
where the liabilities of the company in respect of the
amount vary in amount depending on the market value of a specified group of
assets.
1999 cI‑5.1 s439
Transactions requiring
directors’ approval
440 A provincial company or its subsidiary
may with the prior approval of the directors of the company
                                (a)   enter
into a written contract with a related party for the provision of management
services to or by the company or subsidiary if it is reasonable that the
company or subsidiary obtain or supply the services and so long as the
consideration is reasonable for the services provided and is at fair market
rate,
                                (b)   enter
into a written lease of real estate or personal property with a related party
so long as
                                          (i)   the rent is at fair market rate,
                                         (ii)   the term of the lease and all renewals does not exceed
                                                (A)   5 years in the case of a lease of personal
property, or
                                                 (B)   20 years in the case of a lease of real
estate,
                                            and
                                        (iii)   the terms of the lease are otherwise competitive and reasonable,
                                (c)   enter
into a written contract with a related party at fair market rate for pension
and benefit plans, stock options, incentive benefits and other reasonable
commitments incidental to employment,
                                (d)   enter
into a written contract with a related party respecting the provision of goods
or services, or providing for a networking arrangement for the provision of
goods and services, other than management services, so long as the price paid
for those goods or services is at fair market rate and the term of the contract
and all renewals does not exceed 5 years in total,
                                (e)   acquire
from or sell to a related party prescribed securities, other than securities
issued by the related party, so long as the transaction is at fair market rate,
                                 (f)   acquire
beneficial ownership of shares of a body corporate as permitted by section
421(3),
                                (g)   make
a loan to or guarantee the obligations of an entity, other than a financial
institution, in which the company beneficially owns shares as permitted by
section 421(3) if the loan or guarantee is at fair market rate and meets
prescribed conditions,
                                (h)   make
a loan to
                                          (i)   a director or senior official of the company,
                                         (ii)   an employee of a prescribed class of the company, or
                                        (iii)   the spouse or adult interdependent partner of a director or
senior official of the company or of anÂ
employee referred to in subclause (ii)
                                         on the security of the
residence of the person to whom the loan is made, and the loan must be at fair
market rate except in the case of a loan to an employee of the prescribed
class, to a senior official or to a director who is a senior official or who is
an employee of the prescribed class,
                                 (i)   make
a personal loan to
                                          (i)   a senior official of the company,
                                         (ii)   an employee of a prescribed class of the company, or
                                        (iii)   the spouse or adult interdependent partner of a senior official
of the company or of an employee referred to in subclause (ii)
                                         that is fully secured other
than by promissory note, and the loan must be at fair market rate except in the
case of a loan to a senior official or to an employee of the prescribed class,
                                 (j)   make
a loan to a related party that is a financial institution in which the company
beneficially owns shares as permitted under section 421(3), if the loan is at
fair market rate, is fully secured by securities that meet prescribed
qualifications and is for prescribed purposes,
                                (k)   enter
into a transaction with a related party that is a financial institution if the
transaction consists of a disposition by the company or subsidiary of assets
for which the consideration is fully paid in money and is at fair market rate,
                                 (l)   guarantee
the obligations of a related party that is a financial institution, and
                               (m)   enter into any other transaction with a
related party that the regulations permit it to enter into with the prior
approval of the directors of the company.
RSA 2000 cI‑3
s440;2002 cA‑4.5 s45
Procedures for approvals
by directors
441(1) Where this Subpart requires that a transaction
have the prior approval of the directors of a provincial company, the approval
must be given in writing and in accordance with procedures established under
section 445, and the approval may be given with respect to a specific
transaction or with respect to a class of transactions.
(2) Where this Subpart requires that a transaction
have prior approval of the directors of a provincial company and the
transaction will be reviewed by the directors of a subsidiary of the company
and the subsidiary is a financial institution, the directors of the company are
not required to review the transaction.
1999 cI‑5.1 s441
Disclosure
442(1) A person who knows or has reason to believe
that the person is a related party of a provincial company and who proposes to
enter into a transaction or guarantee with the company or its subsidiary for
which the approval of the directors of the company is required must disclose in
writing to the company the nature of the person’s interest in the proposed
transaction or guarantee forthwith after becoming aware of the facts that make
the person a related party of the company.
(2) Where
the related party is a director or senior official of a provincial company,
disclosure must be made in accordance with section 354.
(3) Where,
with respect to a proposed transaction or guarantee referred to in subsection
(1), a provincial company knows or has reason to believe that a party is a
related party of the company, the company must take all reasonable steps to
obtain from that other party full disclosure in writing of any interest or
relationship, direct or indirect, that would make that other party a related
party of the company.
(4) The
directors of the provincial company must ensure that a disclosure under
subsection (1) or (3) is entered in the minutes of the first directors’ meeting
held after the making of the disclosure.
(5) A
related party must not
                                (a)   vote
or attempt in any way to influence the voting on any resolution to approve the
transaction or guarantee, or
                                (b)   be
present while the subject‑matter of the transaction or guarantee is being
discussed or the vote is being conducted.
(6) Where a provincial company does not receive
full disclosure as required by this section in respect of a proposed
transaction or guarantee, the company or its subsidiary, as the case may be,
must not enter into the transaction or guarantee.
1999 cI‑5.1 s442
Transactions requiring
Ministerial approval
443 A provincial company or its
subsidiary may with the prior approval of the Minister enter into a
transaction, guarantee or investment or a class of transaction, guarantee or
investment with a related party of the company that would otherwise be
prohibited or restricted by this Act or the regulations if the Minister is
satisfied that the transaction, guarantee or investment is in the best
interests of the company and is not prejudicial to the interests of the
shareholders and policyholders.
1999 cI‑5.1 s443
Limits on permitted
transactions
444 No provincial company or
subsidiary of a provincial company may enter into a transaction with a related
party of the company that is permitted under this Subpart if the transaction
exceeds the prescribed limits.
1999 cI‑5.1 s444
Review and approval
procedures
445(1) The conduct review committee of a provincial
company must establish written review and approval procedures to be followed by
the company to ensure compliance with this Subpart.
(2) The
procedures referred to in subsection (1) must be reviewed at least once each
year by the conduct review committee.
(3) The
conduct review committee must report on its review under subsection (1) and
must give its recommendations, if any, with respect to the procedures to the
board of directors.
(4) The
procedures referred to in subsection (1) must deal with at least the following
matters:
                                (a)   the
formalities governing transactions, guarantees and investments in respect of a
related party;
                                (b)   the
obligations of the provincial company, its subsidiaries and the related party
to disclose information;
                                (c)   the
protection of confidential information held by the provincial company or its
subsidiaries relating to its business associates, and the conduct of the
company or subsidiary in cases where the interests of the company or subsidiary
or of a person affiliated with either of them may be in conflict with the
interests of its business associates.
(5) The procedures referred to in subsection (1)
are subject to the approval of the directors and the directors, on receipt of
any recommendation from the conduct review committee, must review the
procedures and make any changes they consider necessary.
1999 cI‑5.1 s445
Duty to report
contraventions
446(1) The auditor of a provincial company must
promptly report to the directors and the Minister any breach of this Subpart of
which the auditor is aware or is made aware under subsection (2).
(2) Any
person undertaking professional services for a provincial company who, in
providing the professional services, becomes aware of a breach of this Subpart
must promptly report the breach to the directors and the auditor of the
company, unless the breach has already been reported under subsection (1).
(3) Nothing
in this section abrogates any privilege that may exist between a solicitor and
a client.
(4) A
person who in good faith makes a report under subsection (1) or (2) is not
liable in any civil action arising from it.
(5) Where
a provincial company or its subsidiary has entered into a transaction
                                (a)   that
is prohibited under this Subpart, or
                                (b)   without
the approvals required under this Subpart,
the company must, on becoming aware of that fact, forthwith
notify the auditor and the Minister of that fact.
1999 cI‑5.1 s446
Reliance on information
447 A provincial company and any
person who is a director, officer, employee or agent of the company may rely on
any information received under section 442 regarding disclosure or any
information otherwise acquired in respect of any matter that might be the
subject of such a disclosure, and the company and person are not liable in any
civil action for anything done or omitted to be done in good faith in reliance
on any such information.
1999 cI‑5.1 s447
Onus of proof
448 For the purposes of this
Subpart, the onus is on the related party and the provincial company or its
subsidiary to establish that a transaction, guarantee or investment between the
company or subsidiary and the related party is permitted under this Subpart.
1999 cI‑5.1 s448
Personal information
448.1(1) In
this section, “personal information� means personal information as defined in
the Personal Information Protection Act other than business contact
information to which that Act does not apply by virtue of section 4(3)(d) of
that Act.
(2) For the purposes of complying with
this Subpart and any regulations made under this Act respecting related
parties, a provincial company may collect and use personal information about
persons who are related parties without obtaining their consent.
(3) Persons
who are not related parties must provide personal information as is necessary
for the provincial company to comply with this Subpart.
2003 cP‑6.5 s69
Applications to Court
449(1) Where a transaction, guarantee or investment
that is prohibited under this Subpart takes place, any interested person,
including the Minister, may apply to the Court for an order
                                (a)   setting
aside the transaction, guarantee or investment and directing that the related
party account to the provincial company for any profit or gain realized, and
                                (b)   that
each person who participated in or facilitated the transaction, guarantee or
investment pay to the company on a joint and several basis
                                          (i)   the damages suffered,
                                         (ii)   the face value of the transaction, guarantee or investment, or
                                        (iii)   the amount expended by the company in the transaction, guarantee
or investment,
and on the application
the Court may so order or make any other order it thinks fit, including an
order for compensation for the loss or damage suffered by the company and
punitive or exemplary damages from the related party.
(2) A
person who is not a director is not liable under subsection (1)(b) unless the
person knew or ought reasonably to have known that the transaction, guarantee
or investment contravened this Subpart.
(3) An application under subsection (1) in respect
of a transaction, guarantee or investment, may only be made within 3 months of
the transaction, guarantee or investments having been entered into.
1999 cI‑5.1 s449
Regulations
450 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
exceptions to section 434(2);
                                (b)   specifying
transactions for the purposes of section 440(m) that may be entered into with a
related party with the prior approval of the directors of the provincial
company;
                                (c)   respecting any matter that is to be
prescribed under this Subpart.
1999 cI‑5.1 s450
Part 3
Insurance Agents and Adjusters
Definitions
451 In this Part,
                                (a)   “business�
means a body corporate, partnership or sole proprietorship, but does not
include an insurer;
                                (b)   “designated
representative� means a designated representative referred to in section 456 or
463;
                                (c)   “general
insurance� means any class of property and casualty insurance other than
accident and sickness insurance;
                                (d)   “group
insuranceâ€? means insurance in which the lives, well‑being or employment
of individuals who enroll in the insurance is insured severally under a single
contract between an insurer and an employer, creditor or other person;
                                (e)   “independent
contractor� means an individual who enters into a contract in the individual’s
own name to provide services as an independent contractor;
                                 (f)   “individual�
does not include an individual who is the sole proprietor of a sole
proprietorship;
                                (g)   “property
and casualty insurance� means any class of insurance other than life insurance;
                                (h)   “sole proprietorship� includes an
independent contractor who has entered into a contract with an insurer, but
does not include an independent contractor who has entered into a contract with
a business.
1999 cI‑5.1 s451
Insurance Agents
Insurance agent’s certificate
452(1) No business may act or offer to act as an
insurance agent in respect of a class of insurance unless the business holds a
valid and subsisting insurance agent’s certificate of authority for that class
of insurance.
(2) No
individual may act or offer to act as an insurance agent in respect of a class
of insurance unless the individual
                                (a)   is
an employee or independent contractor of a business that holds a valid and
subsisting insurance agent’s certificate of authority for that class of insurance
and the employee or independent contractor holds a valid and subsisting
insurance agent’s certificate of authority for that class of insurance,
                                (b)   is
an employee of a business that holds a valid and subsisting restricted
insurance agent’s certificate of authority for that class of insurance, or
                                (c)   is
an employee of an insurer that issues insurance of that class and the employee
holds a valid and subsisting insurance agent’s certificate of authority for
that class of insurance.
(3) No
business that holds an insurance agent’s certificate of authority, other than a
restricted insurance agent’s certificate of authority, may employ an individual
or enter into a contract with an individual as an independent contractor to act
as an insurance agent unless the individual holds a valid and subsisting
insurance agent’s certificate of authority.
(4) No
insurer may employ an individual to act as an insurance agent unless the
individual holds a valid and subsisting
insurance agent’s certificate of authority.
(5) No insurer may allow a business to act as an
insurance agent on its behalf unless the business holds a valid and subsisting
insurance agent’s certificate of authority.
1999 cI‑5.1 s452
Exception
453 Despite section 452, a member
of a licensed fraternal society, other than a member who receives a salary or
commission for the purpose of acting as an insurance agent, who acts or offers
to act as an insurance agent only with respect to insurance issued by the
society for its members is not required to obtain an insurance agent’s
certificate of authority.
1999 cI‑5.1 s453
Restricted insurance
agent’s certificate
454(1) The Minister may issue a restricted insurance
agent’s certificate of authority to a business
                                (a)   that
is a deposit‑taking institution, or
                                (b)   that
operates
                                          (i)   a transportation company,
                                         (ii)   a travel agency,
                                        (iii)   an automobile dealership, or
                                        (iv)   another prescribed enterprise.
(2) A restricted insurance agent’s certificate of
authority authorizes the holder and the holder’s employees to act or offer to
act, subject to prescribed conditions and restrictions, as an insurance agent
in respect of classes or types of insurance specified by the Minister.
1999 cI‑5.1 s454
Representation
455(1) No business that acts as an insurance agent may
indicate in any manner that it represents another business that acts as an
insurance agent.
(2) No
individual may act as an insurance agent for a business unless the individual
holds a valid and subsisting insurance agent’s certificate of authority specifying
that the individual is authorized to represent that business.
(3) An
individual who is an employee or independent contractor of a business may act
as an insurance agent for more than one business, but an individual must obtain
a separate insurance agent’s certificate of authority for each business that
the individual represents.
(4) An
individual who is an employee of an insurer and who holds a valid and
subsisting insurance agent’s certificate of authority may act as an insurance
agent only for
                                (a)   that
insurer,
                                (b)   an
insurer that is an affiliate of that insurer, and
                                (c)   in
the case of automobile insurance, an insurer that is the service carrier for
the Government approved industry plan under section 661.
(5) An individual who is an employee of an insurer
and who holds an insurance agent’s certificate of authority specifying that the
individual is authorized to represent that insurer must not, while that
certificate of authority is subsisting, be issued another insurance agent’s
certificate of authority to represent a different insurer or business.
1999 cI‑5.1 s455
Designated
representative for businesses
456(1) Every business that holds an insurance agent’s
certificate of authority
                                (a)   for
life insurance must have a designated representative for life insurance who
meets the prescribed requirements and is recommended by the licensed life
company that recommended the business be issued an insurance agent’s
certificate of authority for life insurance;
                                (b)   for
general insurance must have a designated representative for general insurance
who meets the prescribed requirements and is recommended by the licensed
insurer that recommended the business be issued an insurance agent’s
certificate of authority for general insurance;
                                (c)   for
accident and sickness insurance must have a designated representative for
accident and sickness insurance who meets the prescribed requirements and is
recommended by the licensed insurer that recommended the business be issued an
insurance agent’s certificate of authority for accident and sickness insurance.
(2) The
designated representative of a sole proprietorship is its sole proprietor,
unless the proprietor designates someone else to be the designated
representative.
(3) This section does not apply to a business that
holds a restricted insurance agent’s certificate of authority.
1999 cI‑5.1 s456
Restricted certificate
holders - designated individual
457 Every business that holds a
restricted insurance agent’s certificate of authority must designate an
individual to be responsible for receiving notices and other documents under
this Act.
1999 cI‑5.1 s457
Recommendations - life
insurance
458(1) Every business that holds an insurance agent’s
certificate of authority for life insurance must be recommended by a licensed
life company that has entered into an agency contract with the business.
(2) Every
individual that holds an insurance agent’s certificate of authority for life
insurance must
                                (a)   be
an employee or an independent contractor of a business that holds an insurance
agent’s certificate of authority for life insurance and be recommended by the
licensed life company that recommended the business receive its certificate of
authority, or
                                (b)   be
an employee of a licensed life company and be recommended by the company.
(3) Subject
to subsection (4), a holder of an insurance agent’s certificate of authority
for life insurance may act as an insurance agent only for the licensed life
company that recommended that the holder be issued an insurance agent’s
certificate of authority.
(4) A
holder of an insurance agent’s certificate of authority for life insurance may
act as an insurance agent for a licensed life company that did not recommend
the holder be issued an insurance agent’s certificate of authority if
                               (a)   the
holder is unable to negotiate life insurance on behalf of an applicant with the
licensed life company that recommended the holder and the prescribed
requirements for obtaining life insurance from another insurer have been met,
or
                               (b)   the
holder has held an insurance agent’s certificate for life insurance for the
prescribed period and has met the prescribed requirements.
(NOTE:Â Â Subsections (3) and (4) come into force on
Proclamation.)
(5) A
holder of an insurance agent’s certificate of authority for life insurance that
has been issued on the recommendation of a licensed life company must not,
while that certificate of authority is subsisting, be issued another insurance
agent’s certificate of authority for life insurance to represent a different
licensed life company.
1999 cI‑5.1 s458
Recommendations -
property and casualty insurance
459(1) Every business that holds an insurance agent’s
certificate of authority for general insurance must be recommended by an
insurer that is licensed to undertake a class of general insurance and that has
entered into an agency contract with the business.
(2) Every
business that holds an insurance agent’s certificate of authority for accident
and sickness insurance must be recommended by an insurer that is licensed to undertake
that class of insurance and that has entered into an agency contract with the
business.
(3) Every
individual that holds an insurance agent’s certificate of authority for general
insurance must
                                (a)   be
an employee or independent contractor of a business that holds an insurance
agent’s certificate of authority for general insurance and be recommended by
the designated representative of the business for general insurance, or
                                (b)   be
an employee of an insurer that is licensed to undertake a class of general
insurance and be recommended by the insurer.
(4) Every
individual that holds an insurance agent’s certificate of authority for
accident and sickness insurance must
                                (a)   be
an employee or independent contractor of a business that holds an insurance agent’s
certificate of authority for accident and sickness insurance and be recommended
by the licensed insurer that recommended the business receive its certificate
of authority for accident and sickness insurance, or
                                (b)   be
an employee of an insurer that is licensed to undertake accident and sickness
insurance and be recommended by the insurer.
(5) Subsections
(3)(a) and (4)(a) do not apply to the designated representative of a business.
(6) A business, or employee or independent
contractor of a business, that holds an insurance agent’s certificate of
authority for a class of property and casualty insurance may, unless the
certificate is made subject to prescribed conditions that provide otherwise,
act as an insurance agent for any insurer that is licensed to undertake that
class of property and casualty insurance.
1999 cI‑5.1 s459
Adjusters
Insurer’s
liability for employee
459.1 Where an individual referred to in
section 460(2)(c) contravenes this Act or the regulations in the course of
employment as an adjuster, the contravention is deemed to have been committed
by the insurer that employs the individual, and any remedy available under this
Act in respect of the contravention may be pursued directly against the
insurer.
2001 c9 s2
Adjuster’s certificate
460(1) No business may act or offer to act as an
adjuster in respect of a contract of insurance unless
                                (a)   the
business holds a valid and subsisting adjuster’s certificate of authority, or
                                (b)   the
business holds a valid and subsisting insurance agent’s certificate of
authority for the class of insurance under which the contract of insurance
falls, the certificate is not a restricted insurance agent’s certificate of
authority, the amount of the loss under the contract is less than the
prescribed amount and the business is the business that sold the contract of
insurance.
(2) No
individual may act or offer to act as an adjuster in respect of a contract of
insurance unless
                                (a)   the
individual is an employee or independent contractor of a business that holds a
valid and subsisting adjuster’s certificate of authority and the employee or
independent contractor holds a valid and subsisting adjuster’s certificate of
authority,
                                (b)   the
individual is an employee or independent contractor of a business that holds a
valid and subsisting insurance agent’s certificate of authority and the
individual holds a valid and subsisting insurance agent’s certificate of
authority for the class of insurance under which the contract of insurance
falls, the amount of the loss under the contract is less than the prescribed
amount and the business is the business that sold the contract of insurance,
                                (c)   the
individual is an employee of an insurer and the contract was issued by that
insurer or by an insurer that is an affiliate of that insurer, or
                                (d)   the
contract is a reciprocal contract of indemnity or inter‑insurance of a
licensed reciprocal insurance exchange and the individual is the principal
attorney of the exchange.
(3) No
business that holds an adjuster’s certificate of authority may employ an
individual or enter into a contract with an individual as an independent
contractor to act as an adjuster unless the individual holds a valid and
subsisting adjuster’s certificate of authority.
(4) No
insurer may enter into a contract with
                                (a)   an
individual as an independent contractor, or
                                (b)   a
business
to act as an adjuster
unless the individual or business holds a valid and subsisting adjuster’s
certificate of authority or meets the requirements of subsection (1)(b) or
(2)(b).
RSA 2000 cI‑3
s460;2001 c9 s3
461 Repealed 2001 c9 s4.
Representation
462(1) No business that acts as an adjuster may
indicate in any manner that itÂ
represents another business that acts as an adjuster.
(2) No
individual may act as an adjuster for a business unless the individual holds a
valid and subsisting adjuster’s certificate of authority specifying that the
individual is authorized to represent that business.
(3) An
individual who is an employee or independent contractor of a business may act
as an adjuster for more than one business, but an individual must obtain a
separate adjuster’s certificate of authority for each business that the
individual represents.
(4) Repealed 2001 c9 s5.
RSA 2000 cI‑3
s462;2001 c9 s5
Designated
representative for businesses
463(1) Every business that holds an adjuster’s
certificate of authority must have a designated representative who meets the
prescribed requirements.
(2) The designated representative of a sole
proprietorship is its sole proprietor, unless the proprietor designates someone
else to be the designated representative.
1999 cI‑5.1 s463
Recommendation
464(1) Every individual who holds an adjuster’s
certificate of authority must be an employee or independent contractor of a
business that holds an adjuster’s certificate of authority and be recommended
by the designated representative of the business.
(2) Subsection (1) does not apply to the designated
representative of a business.
RSA 2000 cI‑3
s464;2001 c9 s6
Certificates of Authority
Financial guarantee
465(1) Every business and individual that holds a
certificate of authority must meet the requirements respecting financial
guarantees set out in the regulations.
(2) This
section does not apply in respect of
                                (a)   a
certificate of authority issued to an employee of a licensed insurer, or
                                (b)   a certificate of authority for a prescribed
class or type of insurance or for a prescribed class or type of certificate
holder.
1999 cI‑5.1 s465
Names
466(1) No business may be issued a new certificate of
authority or have a certificate of authority renewed or reinstated if the name
of the business
                                (a)   includes
the words “insurance company� or “insurance corporation� or the French
equivalent of those words, or
                                (b)   is
identical or similar to the name of an insurer formed under the laws of Canada
or of a province or territory.
(2) The Minister may refuse to issue a new
certificate of authority or to renew or reinstate a certificate of authority to
a business if the Minister is satisfied that the name of the business is
confusing or misleading.
1999 cI‑5.1 s466
Application for
certificate
467(1) An application for a certificate of authority
must
                                (a)   be
filed with the Minister,
                                (b)   in
the case of an insurance agent’s certificate of authority, specify the classes
of insurance in respect of which the applicant wishes to transact,
                                (c)   contain
the information, material and evidence required by the Minister, and
                                (d)   be
accompanied with proof that the requirements respecting financial guarantees
referred to in section 465(1) have been met.
(2) An
application for an applicant’s new or reinstated certificate of authority must
be accompanied with
                                (a)   a
written recommendation of an insurer or designated representative as required
by section 458, 459 or 464, as the case may be, and
                                (b)   in
the case of an application by a business for an insurance agent’s or adjuster’s
certificate of authority, the written designation of an individual to be the
business’s designated representative.
(3) The
requirement to submit a designation under subsection (2)(b) applies to a sole
proprietorship only if the sole proprietor designates someone other than the
proprietor to be the designated representative.
(4) After filing an application, the applicant must
provide the Minister with any additional information, material and evidence
that the Minister considers necessary.
1999 cI‑5.1 s467
Refusing certificates -
general grounds
468(1) The Minister may refuse to issue an applicant’s
new certificate of authority if the requirements of this Act and the
regulations relating to the certificate have not been met.
(2) The
Minister may refuse to renew or reinstate an applicant’s certificate of
authority
                                (a)   on
the grounds set out in section 480(1) in accordance with that section, and
                                (b)   if any of the requirements of this Act and
the regulations, other than those referred to in section 480(1), relating to
the certificate have not been met.
1999 cI‑5.1 s468
Issuing certificates
469(1) A business that is entitled to receive an
insurance agent’s certificate of authority for life insurance and one or more
classes of property and casualty insurance must be issued
                                (a)   an
insurance agent’s certificate of authority for life insurance, and
                                (b)   one
or more insurance agent’s certificates of authority for the property and
casualty insurance.
(2) If
a certificate of authority is issued or renewed in respect of an individual who
is an employee or independent contractor of a business, the certificate must
state the name of the business that the individual is authorized to represent.
(3) If
a certificate of authority is issued or renewed in respect of an individual who
is an employee of an insurer, the certificate must state the name of the
insurer that the individual is authorized to represent.
(4) If an insurance agent’s certificate of
authority is to be issued to a sole proprietorship that has or intends to have
one or more individuals working as insurance agents or if an adjuster’s
certificate of authority is to be issued to a sole proprietorship that has or
intends to have one or more individuals working as adjusters, a certificate of
authority must be issued in the name of the sole proprietorship and a
certificate of authority must be issued in the name of the sole proprietor.
1999 cI‑5.1 s469
Terms and conditions
470(1) The Minister may issue a certificate of
authority subject to terms and conditions provided for in the regulations.
(2) Every business and individual who holds a
certificate of authority must comply with the terms and conditions to which the
certificate is subject.
1999 cI‑5.1 s470
Expiration
471 A certificate of authority
expires in accordance with the regulations.
1999 cI‑5.1 s471
Reinstating certificates
472 If a certificate of authority
is suspended by or under this Act for an unspecified period of time, the
certificate may be reinstated only if the holder submits an application for
reinstatement to the Minister.
1999 cI‑5.1 s472
Ceasing to be worker
473(1) The certificate of authority of an individual
who is an employee or independent contractor of a business or an employee of an
insurer is automatically suspended when the individual ceases to be an employee
or independent contractor of the business or an employee of the insurer.
(2) If
an individual who
                                (a)   is
an employee or independent contractor of a business and acts as an insurance
agent or adjuster, or
                                (b)   is
an employee of an insurer and acts as an insurance agent
ceases to be such an employee or independent contractor,
the business or insurer, as the case may be, must, within 14 days from the date
that the individual ceased to be such an employee or independent contractor,
notify the Minister in writing of that fact.
RSA 2000 cI‑3
s473;2001 c9 s7
Changes in designated
representative
474(1) A designated representative who resigns must
                                (a)   give
a notice of resignation to the business that the designated representative
represents, and
                                (b)   send
a copy of the notice to the Minister.
(2) If
a business that a designated representative represents revokes the designation
or if the designated representative of a business dies, the business must
immediately notify the Minister and, in the case of a revocation, provide the
reasons for the revocation.
(3) If
an insurer that has recommended that a designated representative be issued an
insurance agent’s certificate of authority cancels the recommendation, the
insurer must immediately notify in writing the business and the Minister of the
cancellation of the recommendation and the reasons for the cancellation.
(4) If
a designated representative of a business resigns or dies, the business must,
within 14 days from the resignation or death, submit to the Minister a written
designation of an individual who meets the requirements of this Act and the
regulations to be the new designated representative and, if the business does
not comply with this requirement, the certificate of authority of the business
is automatically suspended.
(5) When
                                (a)   a
business revokes the designation of its designated representative,
                                (b)   an
insurer cancels its recommendation of a designated representative, or
                                (c)   a
designated representative no longer meets the prescribed requirements for being
a designated representative,
the certificate of
authority of the business represented by the designated representative is
automatically suspended unless, before the events referred to in clauses (a) to
(c) occur, the business submits to the Minister a written designation of an
individual who meets the requirements of this Act and the regulations to be the
new designated representative.
(6) If
a business’s certificate of authority is suspended under subsection (4) or (5),
the certificates of authority of the business’s employees and independent
contractors are automatically suspended.
(7) When
a designated representative of a business has died, a reference in this section
to suspending the business’s certificate of authority or to suspending the
certificates of authority of the employees or independent contractors of the
business refers to every class of certificate of authority that was held by the
designated representative.
(8) When
                                (a)   a
business’s designated representative resigns as a designated representative in
respect of a class of certificate of authority,
                                (b)   a
business revokes the designation of a designated representative in respect of a
class of certificate of authority,
                                (c)   an
insurer cancels a recommendation of a designated representative of a business,
or
                                (d)   a
business’s designated representative no longer meets the prescribed
requirements for being a designated representative in respect of a class of
certificate of authority,
a reference in this
section to suspending the business’s certificate of authority or to suspending
the certificates of authority of the employees or independent contractors of the
business refers to those certificates of authority that are of the same class
as the class of certificate of authority in respect of which the designated
representative resigned, was revoked or was no longer meeting the prescribed
requirements for or in respect of which the recommendation was cancelled.
(9) This section does not apply in respect of a
sole proprietorship whose designated representative is its sole proprietor.
1999 cI‑5.1 s474
Cancellation of
recommendation by insurer - businesses
475(1) If an insurer that has recommended that a
business be issued an insurance agent’s certificate of authority cancels the
recommendation or if the agency contract between that insurer and business is
no longer in force, the insurer must immediately notify the Minister in writing
                                (a)   of
the cancellation of the recommendation and the reasons for the cancellation, or
                                (b)   that
the agency contract is no longer in force and the reasons why the agency
contract is no longer in force.
(2) When
an insurer that has recommended that a business be issued an insurance agent’s
certificate of authority cancels the recommendation or when the agency contract
between that insurer and business is no longer in force, the business’s
insurance agent’s certificate of authority is automatically suspended unless,
before the cancellation of the recommendation or the termination or expiration
of the agency contract, the business submits to the Minister a new insurer’s
written recommendation referred to in section 458(1) or 459(1) or (2), as the
case may be.
(3) If
a business’s insurance agent’s certificate of authority is suspended under
subsection (2), the insurance agent’s certificates of authority for the
business’s employees and independent contractors are automatically suspended.
(4) If
an insurer that has recommended that an employee or independent contractor of a
business be issued an insurance agent’s certificate of authority cancels the
recommendation, the insurer must immediately notify the Minister in writing of
the cancellation and the reasons for the cancellation.
(5) When
an insurer that has recommended that an employee or independent contractor of a
business be issued an insurance agent’s certificate of authority cancels the
recommendation, the employee’s or independent contractor’s certificate of
authority is automatically suspended unless, before the cancellation of the
recommendation, the employee or independent contractor submits to the Minister
a new insurer’s written recommendation referred to in section 458(2) or 459(4).
(6) When
a business is required to replace the recommendation of an insurer, a reference
in this section to suspending the business’s certificate of authority or to
suspending the certificates of authority of the employees or independent
contractors of the business refers to
                                (a)   certificates
of authority for life insurance if the insurer referred to in subsection (2)
was the insurer that recommended the business receive an insurance agent’s
certificate of authority for life insurance,
                                (b)   certificates
of authority for general insurance if the insurer referred to in subsection (2)
was the insurer that recommended the business receive an insurance agent’s
certificate for general insurance, and
                                (c)   certificates of authority for accident and
sickness insurance if the insurer referred to in subsection (2) was the insurer
that recommended the business receive an insurance agent’s certificate of
authority for accident and sickness insurance.
1999 cI‑5.1 s475
Cancellation of
recommendation by designated representative
476 If a designated representative
who recommended that an individual be issued a certificate of authority cancels
the recommendation, the certificate of authority is automatically suspended,
and the designated representative must immediately notify the Minister in
writing of the cancellation and the reasons for the cancellation.
1999 cI‑5.1 s476
Cancellation of
recommendation by insurer - employees
477 If an insurer that recommended
that one of its employees be issued a certificate of authority cancels the
recommendation, the certificate of authority is automatically suspended, and
the insurer must immediately notify the Minister in writing of the cancellation
and the reasons for the cancellation.
1999 cI‑5.1 s477
Financial guarantee not
in force
478(1) If, during the term of a certificate of
authority, the financial guarantee referred to in section 465 maintained in
respect of that certificate is no longer in force, the grantor of the financial
guarantee must notify the Minister of this fact in accordance with the terms of
the guarantee.
(2) If,
during the term of the certificate of authority, the financial guarantee
referred to in section 465 maintained in respect of the certificate is no
longer in force, the certificate of authority is automatically suspended
unless, while the guarantee is in force, the holder of the certificate
satisfies the Minister that the holder is covered by a new financial guarantee
that meets the requirements of section 465.
(3) If a business’s certificate of authority is
suspended under subsection (2), the certificates of authority for the
business’s employees and independent contractors are automatically suspended.
1999 cI‑5.1 s478
Notice of automatic
suspension
479 When the certificate of
authority of an employee or independent contractor of a business is
automatically suspended under the provision of this Part, the business must
immediately notify the employee or independent contractor of the suspension.
1999 cI‑5.1 s479
Sanctions affecting
certificates
480(1) If the Minister is satisfied that the holder or
a former holder of a certificate of authority
                                (a)   has
been guilty of misrepresentation, fraud, deceit, untrustworthiness or
dishonesty,
                                (b)   has
contravened any provision of this Act or the regulations or similar legislation
in another jurisdiction or legislation that is a predecessor of this Act or the
regulations,
                                (c)   has
unreasonably failed to pay any premium collected by the holder within the time
period stipulated in the holder’s agency contract to an insurer or an insurance
agent who is entitled to the premium,
                                (d)   has
placed insurance with an insurer not licensed in Alberta under this Act without
complying with the provisions of this Act relating to unlicensed insurers, or
                                (e)   has
demonstrated incompetence to act as an insurance agent in the case of an
insurance agent’s certificate of authority or to act as an adjuster in the case
of an adjuster’s certificate of authority,
the Minister may
revoke, suspend or refuse to renew or reinstate one or more of the certificates
of authority held by the holder, impose terms and conditions provided for in
the regulations on one or more of the certificates of authority held by the
holder and impose a penalty on the holder or former holder.
(2) The
amount of a penalty imposed under subsection (1) is governed by the
regulations.
(3) The
Minister must notify the holder or former holder of a certificate of any
decision of the Minister under subsection (1).
(4) If
a penalty levied against a certificate holder under subsection (1) is not paid
within 30 days after the serving of the written notice of the penalty and the
decision of the Minister is not appealed, the certificate of authority is
automatically suspended immediately following the last date for paying the penalty
or appealing the decision, whichever is later, and remains suspended until the
penalty is paid or cancelled or the certificate expires.
(5) If
a certificate expires while it is suspended under subsection (1) or (4), the
former holder of the certificate must not be issued a certificate of authority
until any penalty that is imposed under this section is paid or the penalty is
cancelled.
(6) A
penalty need not be paid while the decision imposing it is under appeal.
(7) If
any amount of the penalty is due and is not paid, that amount bears interest at
the prescribed rate from the last date for paying it.
(8) If
a business’s certificate of authority is revoked or suspended by the Minister
under subsection (1) or by the operation of subsection (4), the certificates of
authority held by employees or independent contractors of the business are
automatically suspended if they are of the same class as the business’s
certificate that is revoked or suspended, and the Minister must notify the
employees and independent contractors of the suspension.
(9) The
Minister must not impose a penalty under this section in respect of an act or
omission more than 3 years after
                                (a)   the
act or omission occurred, or
                                (b)   if the act or omission is of a continuing
nature, the termination of the act or omission.
1999 cI‑5.1 s480
Minister’s order
480.1(1) If the Minister is satisfied that an employee
referred to in section 460(2)(c) has contravened section 509 or a regulation
under section 511, the Minister may, by order in writing directed to the
insurer that employs the employee, order the insurer to ensure that the
employee ceases to act as an adjuster on behalf of the insurer or affiliate.
(2) An
order under subsection (1) may be made for a definite or indefinite period of time
and may be made subject to any terms or conditions the Minister considers
appropriate.
2001 c9 s8
Demand for information
481(1) The Minister may direct the holder or former
holder of a certificate of authority to provide to the Minister within a reasonable
period of time specified in the direction any information specified by the
Minister relating to the matters in section 480(1).
(2) A
person served with a direction under subsection (1) who has the information
must provide the information in accordance with the direction.
(3) Where
a person served with a direction under this section does not provide the
information in accordance with the direction, the Minister may on 2 days’
written notice to that person, without affecting any sanction that the person
may be subject to under this Act, apply to the Court for an order under
subsection (4).
(4) The
Court may order the person to provide the information subject to any conditions
the Court considers appropriate if the Court is satisfied that the information
is in the possession or under the control of the person and is relevant to the
matters in section 480(1).
(5) The Minister may copy or otherwise record any
information provided under this section and must, within a reasonable time,
return the originals of any documents that have been provided under this
section to the person who provided them.
1999 cI‑5.1 s481
Appeal
482 A decision of the Minister
under this Part to refuse to issue, renew or reinstate a certificate of
authority, to impose terms and conditions on a certificate of authority, to
revoke or suspend a certificate of authority or to impose a penalty on the
holder or former holder of a certificate of authority may be appealed in
accordance with the regulations.
1999 cI‑5.1 s482
Evidentiary provisions
482.1 Sections 4, 5, 8, 9, 10, 11 and 12 of the
Public Inquiries Act apply where
                                (a)   the
Minister holds a hearing for the purposes of exercising powers under section
480, or
                                (b)   an
appeal body holds a hearing for the purposes of an appeal referred to in
section 482.
2001 c9 s9
Consequence of
revocation
483(1) No business or individual whose insurance
agent’s certificate of authority has been revoked may be issued a new insurance
agent’s certificate of authority for one year after the revocation.
(2) Despite
subsection (1), a business or individual whose insurance agent’s certificate of
authority has been revoked because of incompetence in respect of a class of
insurance may be issued an insurance agent’s certificate of authority in respect
of a different class of insurance.
(3) No business or individual whose adjuster’s
certificate of authority has been revoked may be issued a new adjuster’s
certificate of authority for one year after the revocation.
1999 cI‑5.1 s483
Exemption from municipal
licence fee
484 The holder of a certificate of
authority is exempt from payment of any licence fee imposed by a municipality
or Metis settlement for the transaction of the business of insurance.
1999 cI‑5.1 s484
Duties and Prohibitions
Screening procedures
485(1) Every insurer that recommends an individual or
sole proprietor to be issued an insurance agent’s certificate of authority must
                                (a)   establish
reasonable screening procedures to determine whether the individual is suitable
to act as an insurance agent, and
                                (b)   use
those procedures to screen an individual or sole proprietor before making a
recommendation.
(2) Repealed
2001 c9 s10.
(3) Every
business that acts as an adjuster that designates an individual to be its
designated representative must
                                (a)   establish
reasonable screening procedures to determine whether the individual is suitable
to act as an adjuster, and
                                (b)   use
those procedures to screen an individual before making a designation.
(4) Every
designated representative who recommends that an individual be issued an
insurance agent’s certificate of authority must
                                (a)   establish
reasonable screening procedures to determine whether the individual is suitable
to act as an insurance agent, and
                                (b)   use
those procedures to screen an individual before making a recommendation.
(5) Every
designated representative who recommends that an individual be issued an
adjuster’s certificate of authority must
                                (a)   establish
reasonable screening procedures to determine whether the individual is suitable
to act as an adjuster, and
                                (b)   use those procedures to screen an individual
before making a recommendation.
RSA 2000 cI‑3
s485;2001 c9 s10
Knowledgeable personnel
486 Every holder of a restricted insurance
agent’s certificate of authority and every insurer on behalf of which the
holder is marketing insurance must
                                (a)   establish
reasonable procedures to ensure that personnel marketing insurance for the
holder are knowledgeable about the insurance being marketed, and
                                (b)   use those procedures.
1999 cI‑5.1 s486
Information
487 Every holder of a certificate
of authority must, on the request of the Minister, provide the Minister with
information and copies of any document in its possession relating to its
insurance activities.
1999 cI‑5.1 s487
Insurance broker
488 No insurance agent may purport to be an
insurance broker unless
                                (a)   the
insurance agent is a party to 2 or more subsisting agency contracts with
different insurers, and
                                (b)   none of the agency contracts requires the
insurance agent to deal only with insurance offered by one insurer.
1999 cI‑5.1 s488
Advertising
489 No business or individual who
is required to hold an insurance agent’s or adjuster’s certificate of authority
before acting as an insurance agent or adjuster may indicate in an advertisement
that the business or individual is an insurance agent or adjuster or offer in
an advertisement to provide the services of an insurance agent or adjuster
unless the business or individual, as the case may be, holds the appropriate
valid and subsisting certificate of authority.
1999 cI‑5.1 s489
Disclosure of business
name
490(1) No business that holds an insurance agent’s
certificate of authority and no employee or independent contractor of a
business that holds an insurance agent’s certificate of authority may indicate
in any advertisement or document or in any other manner that the business’s
insurance agent activities are carried out under a business name that is
different from the name set out in the certificate of authority.
(2) No
business that holds an adjuster’s certificate of authority and no employee or
independent contractor of a business that holds an adjuster’s certificate of
authority may indicate in any
advertisement or document or in any other manner that the business’s adjuster
activities are carried out under a business name that is different from the
name set out in the certificate of authority.
(3) Every business that holds a certificate of
authority must ensure that its name as set out in the certificate of authority
is shown in a conspicuous manner in all of its advertising, correspondence and
contracts relating to the activities authorized by the certificate of
authority.
1999 cI‑5.1 s490
Representative’s duty of disclosure
491 An individual who acts as an insurance
agent for 2 or more businesses must, before a potential client purchases
insurance from the individual, disclose in writing to the client
                                (a)   the
name of the business the individual is representing, and
                                (b)   that the disclosure under clause (a) is made
for the purposes of complying with this section.
1999 cI‑5.1 s491
Notices
Notices
492(1) Subject to subsection (2), any notice or
document that is required under this Act or the regulations to be given to or
served on a business that is required to hold a certificate of authority may be
given to or served on the business’s designated representative.
(2) Any notice or document that is required under
this Act or the regulations to be given to or served on a business that holds a
restricted insurance agent’s certificate of authority may be given to or served
on the individual designated by the business under section 457.
1999 cI‑5.1 s492
Insurance Councils
Insurance councils
493(1) The following are continued as insurance
councils:
                                (a)   the
Alberta Insurance Council;
                                (b)   the
General Insurance Council;
                                (c)   the
Life Insurance Council;
                                (d)   the
Insurance Adjusters’ Council.
(2) The insurance councils referred to in
subsection (1) are bodies corporate and consist of members determined in
accordance with the regulations.
1999 cI‑5.1 s493
Delegated powers
494 An insurance council may
exercise any of the Minister’s powers, duties or functions delegated to it by
or under the regulations.
1999 cI‑5.1 s494
Bylaws of insurance
councils
495(1) Every insurance council must make bylaws
governing
                                (a)   the
notice required for and the holding and conduct of its meetings,
                                (b)   the
quorum for its meetings,
                                (c)   the
remuneration and expenses of its members,
                                (d)   the
establishment and functions of any committees of the council, and
                                (e)   the
indemnification of members of the council for matters in respect of which a
provincial company may indemnify its directors pursuant to section 365,
and may make bylaws
respecting other aspects of its internal proceedings.
(2) An
insurance council that has made a bylaw or an amendment to a bylaw must file a
copy of the bylaw or amendment with the Minister within 30 days after making
it, and the bylaw or amendment has no effect unless it is approved by the
Minister.
(3) The
Minister must, within 60 days after receiving a copy of a bylaw or an amendment
from the insurance council that made the bylaw or amendment, give written
notice to the insurance council that the Minister approves or does not approve
the bylaw or amendment.
(4) The
only grounds on which the Minister may refuse to approve a bylaw or amendment
are that the Minister considers the bylaw or amendment
                                (a)   to
be unjust or prejudicial to the public interest, or
                                (b)   to
go beyond the council’s powers to make bylaws.
(5) A bylaw or amendment, if approved, comes into
force on the date of the approval or the date, if any, specified for
commencement in the bylaw or amendment, whichever date is later.
1999 cI‑5.1 s495
Winding-up of insurance
councils
496 If an insurance council is
wound up, the assets of the insurance council must, after the payment of the
costs of the winding‑up and any liabilities of the council, be
transferred to the Crown in right of Alberta.
1999 cI‑5.1 s496
Regulations for
Compensation Plan and Other Matters
Compensation plan
497(1) The Lieutenant Governor in Council
may make regulations establishing a plan for the purposes of compensating
persons who have suffered loss as a result of the fraudulent activities of
insurance agents and adjusters.
(2) Without
limiting subsection (1), the regulations may provide for the following matters:
                               (a)   the
designation or establishment of an entity to operate the plan and the powers,
duties and functions of the entity and, if the entity is established by the
regulations, whether the entity is a body corporate;
                               (b)   the
insurance agents and adjusters who are members of the plan;
                               (c)   the
meaning of fraudulent activities for the purposes of the plan;
                               (d)   who
is eligible to receive payments from the plan, the grounds on which payments
may be made, the application process for payments and the amount of payments
that may be made from the plan;
                               (e)   determining
the amount of assessments that members of the plan are required to pay to the
plan, when the assessments have to be paid, the liability of members or past
members for unpaid assessments and the means of collecting unpaid assessments;
                                (f)   providing
that an insurance agent’s or adjuster’s certificate of authority may be
suspended or cancelled or not renewed for non‑payment of assessments;
                               (g)   the subrogation of rights to the operator of
the plan when a payment is made from the plan.
1999 cI‑5.1
s497
(NOTE:Â Â Section 497
comes into force on Proclamation.)
Regulations
498 The Lieutenant Governor in Council may
make regulations
                                (a)   establishing
classes or levels of certificates of authority and setting out the limitations
and restrictions attached to each class or level of certificate;
                                (b)   respecting
the requirements, conditions, continuing education, training and experience for
the issuance of new certificates of authority and the renewal and reinstatement
of certificates of authority;
                                (c)   respecting
the requirements for designated representatives;
                                (d)   respecting
financial guarantees for the purposes of section 465, including establishing
insurance as a type of financial guarantee;
                                (e)   respecting
the classes or types of insurance or holders of certificates of authority for
the purposes of section 465(2)(b);
                                 (f)   respecting
terms and conditions that may be imposed on a certificate of authority;
                                (g)   respecting
the expiration of certificates of authority;
                                (h)   respecting
the training and conduct of the employees of the holders of restricted
insurance agent’s certificates of authority who market insurance;
                                 (i)   respecting
the penalties that may be imposed under section 480(1);
                                 (j)   respecting
the appeal of a decision of the Minister referred to in section 482 including
providing for
                                          (i)   the formation of an appeal body and the manner of appointment of
members,
                                         (ii)   appeals to the courts,
                                        (iii)   whether a decision that is being appealed remains in force during
an appeal,
                                        (iv)   matters relating to fees for making an appeal, and
                                         (v)   the powers, duties and functions of an appeal body;
                                (k)   respecting
the replacement of an existing life insurance contract by another contract of
life insurance and the duties of insurers and insurance agents relating to the
replacement;
                                 (l)   respecting
the composition, and the term and manner of determining members, of each
insurance council;
                               (m)   authorizing
the Minister to delegate any of the Minister’s powers, duties or functions
under this Part or the regulations under this Part and sections 794 and 795 to
any of the insurance councils, establishing the restrictions on and limitations
of any such delegation and otherwise respecting any such delegated powers,
duties and functions;
                                (n)   respecting
the fees, levies, penalties and other charges that are to be paid to insurance
councils by insurers, insurance agents or adjusters for any thing an insurance
council does under the authority of this Act, respecting the means of enforcing
payment of the fees, levies, penalties or other charges and specifying that
all, some or none of the fees, levies, penalties or other charges are to be
remitted to the Minister of Finance;
                                (o)   respecting
the winding‑up and dissolution of an insurance council;
                                (p)   respecting any matter that is to be
prescribed under this Part.
RSA 2000 cI‑3
s498;2005 c27 s19
Part 4
Market Conduct
Dealing with
unauthorized insurance agents
499(1) No insurer, no officer, employee or agent of an
insurer and no insurance agent may, directly or indirectly, pay or allow, or
offer or agree to pay or allow, any commission or other compensation or
anything of value to any person acting or offering to act as an insurance agent
in Alberta, unless that person is authorized to act as an insurance agent under
this Act.
(2) Subsection
(1) does not apply to the payment
                                (a)   by
an insurance agent of part of the agent’s commission to insurance agents
outside Alberta, or
                                (b)   of renewal commissions under the terms of an
agency contract.
1999 cI‑5.1 s499
Amount of premium
500 No insurer, no officer,
employee or agent of an insurer and no insurance agent may indicate that the
premium to be paid for a policy is an amount that is different than the amount
of the premium set out in the policy.
1999 cI‑5.1 s500
Premium refunds
501(1) This section does not apply to automobile
insurance.
(2) If
an insurer terminates a contract of insurance, the insurer must pay to the
insured a refund of premiums in an amount calculated using the prorated method.
(3) If
an insured terminates a contract of insurance, the insurer must pay to the
insured a refund of premiums in an amount calculated under the prorated method
unless the contract sets out a formula for a different method of calculating
the amount of the refund and, if the different method involves a short rate
premium, a table showing the short rate
premiums.
(4) This section operates despite any statutory
condition contained in a policy.
1999 cI‑5.1 s501
Payments to agent
502(1) A payment to an agent of an insurer or to an
insurance agent who represents an insurer, whether in cash or by negotiable
instrument and whether in whole or in part, of the amount of a premium
                                (a)   due
in respect of a contract issued by the insurer, or
                                (b)   that
will become due in respect of a contract not yet issued by the insurer,
is deemed a payment to
the insurer, despite any condition or stipulation to the contrary.
(2) No agent of an insurer or insurance agent may
receive or accept payment of a premium for a life insurance policy if the form
of payment is a negotiable instrument payable to the agent unless the agent is
a deposit‑taking institution that holds a restricted insurance agent’s
certificate of authority.
RSA 2000 cI‑3
s502;2003 c19 s35
Agent receiving premiums
503 An insurance agent is, for the
purpose of receiving any premium for a contract of insurance, the agent of the
insurer under the contract, despite any conditions or stipulations to the contrary.
1999 cI‑5.1 s503
Agent trustee of
premiums
504(1) An insurance agent who acts in negotiating,
renewing or continuing a contract of insurance with an insurer and who receives
a payment from the insured for a premium for the contract is deemed to hold the
premium in trust for the insurer.
(2) If the insurance agent fails to pay the
premium, less the agent’s commission and any deductions to which, by the
written consent of the insurer, the agent is entitled, over to the insurer
within 30 days after the agent receives a written demand for payment of the
premium, the agent’s failure is proof, in the absence of evidence to the
contrary, that the agent has used or applied the premium for a purpose other
than paying it over to the insurer.
1999 cI‑5.1 s504
Additional fees
505(1) In this section, “fee� does not include the
premium payable under a contract of insurance.
(2) No insurance agent may charge or collect a fee
for providing a service to a person who is or is in the process of acquiring
insurance through the agent unless the person has agreed in writing before the
service is provided to pay the fee.
1999 cI‑5.1 s505
Providing copies of
policies
506 Every insurer must, on the
request of the Minister, provide the Minister with a copy of any policy that
evidences a contract of insurance that is made in Alberta.
1999 cI‑5.1 s506
Prohibiting use of
certain forms
507 Where, in the opinion of the
Minister, a form of policy or contract of insurance or a form of application,
endorsement, information folder or advertisement relating to insurance is
unfair, misleading or deceptive, the Minister may by order prohibit an insurer
or insurance agent, or both, from using that form, and the person who is
subject to the order must comply with the order.
1999 cI‑5.1 s507
Disclosure of name
508 Every licensed insurer must
ensure that its name as set out in its licence is shown in a conspicuous manner
in all of its advertising, correspondence, contracts of insurance and policies.
1999 cI‑5.1 s508
Unfair practices
509(1) No insurer, insurance agent or adjuster may
                                (a)   make
a false or misleading statement, representation or advertisement,
                                (b)   engage
in a tied selling practice prohibited by the regulations,
                                (c)   commit
any unfair, coercive or deceptive practice, or
                                (d)   make
any statement or representation or commit any practice or act that is
prohibited by the regulations.
(2) No person may, by means of misleading or false
statements, procure or induce or attempt to procure or induce any person to
forfeit, surrender or allow the lapse of any policy of insurance.
1999 cI‑5.1 s509
Dealing with
unauthorized insurers
510(1) In this section, “unauthorized insurer� in
respect of a contract of insurance means an insurer that is not permitted by
this Act to enter into the contract as the insurer.
(2) An insurance agent is personally liable to the
insured under a contract of insurance made in Alberta by or through the agent
directly or indirectly with an unauthorized insurer in the same manner as if
the agent were a licensed insurer.
1999 cI‑5.1 s510
Regulations
511(1) The Lieutenant Governor in Council may make
regulations
                                (a)   respecting
the underwriting of risks by insurers, including the criteria to be used to
determine if a risk is to be insured;
                             (a.1)   governing
the relationships among, and the duties and functions of, insurers, insurance
agents and insurance brokers;
                                (b)   respecting
the claims settlement practices of insurers and adjusters;
                                (c)   respecting
the confidentiality of information obtained by insurers, insurance agents or
adjusters;
                                (d)   respecting
insurance marketed through electronic media, including
                                          (i)   regulating and prohibiting specified activities involved in
marketing insurance through electronic media,
                                         (ii)   disclosure requirements in respect of insurance marketed through
electronic media, and
                                        (iii)   setting out the rights and remedies of insured who enter into
contracts of insurance wholly or partly through electronic media;
                                (e)   respecting
an insured’s right to rescind a contract of life insurance and an insurer’s
obligation to refund premiums if the contract is rescinded;
                                 (f)   respecting
the disclosure by insurance agents to insured or potential insured of the fact
that insurance agents are receiving compensation, inducements or benefits from
insurers for contracts of insurance sold by the insurance agents;
                                (g)   respecting
the disclosure by insurers, insurance agents and adjusters to insured or
potential insured of information, other than the information referred to in
clause (f), including
                                          (i)   the disclosure to the insured of amounts paid under contracts of
insurance to third parties, and
                                         (ii)   the disclosure of the insured’s right under an insurance policy
to repairs and replacement of property that has been lost or damaged;
                                (h)   describing
the types of tied selling practices that are prohibited for the purposes of
section 509(1)(b);
                             (h.1)   respecting
the receiving, handling and resolution of complaints, other than complaints
referred to in section 661.3, by persons against insurers, including, without
limitation, regulations
                                          (i)   governing the procedures to be followed or otherwise used by
insurers in receiving complaints, including procedures for acknowledging
receipt of complaints;
                                         (ii)   governing the procedures to be followed or otherwise used by insurers
in handling complaints, including establishing a system of recording
complaints;
                                        (iii)   governing the procedures to be followed or otherwise used by
insurers in resolving complaints, including the remedies available to resolve
complaints;
                                        (iv)   requiring insurers to appoint an officer in charge of the
insurer’s complaint procedures and prescribing the functions and duties of that
officer;
                                         (v)   requiring insurers to file annual reports with the Superintendent
in respect of complaints received by insurers, including the number and nature
of the complaints received according to categories prescribed in the
regulations;
                                        (vi)   governing the duties, functions and powers of the Superintendent,
if any, in respect of the receiving, handling and resolution of complaints;
                                 (i)   respecting
any matter that is to be prescribed under this Part.
(2) The Minister may make regulations respecting
ethical, operational and trade practices for insurers, insurance agents or
adjusters, and the regulations may adopt, with or without modification,
industry codes of conduct or guidelines relating to those matters.
RSA 2000 cI‑3
s511;2001 c9 s11;2003 c40 s3;2005 c27 s11
Part 5
Insurance Contracts
Subpart 1
Insurance Contracts in Alberta
Application
512 Except where otherwise provided and where not
inconsistent with any other provision of this Act, the provisions of this
Subpart apply to every contract of insurance other than a contract of life
insurance to which Subpart 4 applies.
1999 cI‑5.1 s512
Terms, etc., of
contracts
513(1) All the terms and conditions of a contract of
insurance must be set out in full in the policy or by writing securely attached
to it when issued, and unless so set out no term of the contract or condition,
stipulation, warranty or proviso modifying or impairing its effect is valid or
admissible in evidence to the prejudice of the insured or any beneficiary.
(2) Subsection
(1) does not apply to an alteration or modification of the contract agreed on
in writing by the insurer and the insured after the issue of the policy.
(3) Every
policy must contain
                                (a)   the
name of the insurer;
                                (b)   the
name of the insured;
                                (c)   the
name of the person or persons to whom the insurance money is payable;
                                (d)   the
amount or the method of determining the amount of the premium for the
insurance;
                                (e)   the
subject‑matter of the insurance;
                                 (f)   the
indemnity for which the insurer may become liable;
                                (g)   the
event on the happening of which the liability is to accrue;
                                (h)   the
date on which the insurance takes effect;
                                 (i)   the
date it terminates or the method by which that date is fixed or is to be fixed.
(4) Subsection
(3) does not apply to contracts of accident and sickness insurance, guarantee
insurance or hail insurance.
(5) When
a contract, whether it does or does not provide for its renewal, is renewed by
a renewal receipt, it is a sufficient compliance with subsection (1) if the
terms and conditions of the contract were set out as provided by that
subsection and the renewal receipt refers to the contract by its number or date.
(6) The
proposal or application of the insured must not, as against the insured, be
deemed to be a part of or be considered with the contract of insurance except
insofar as the Court determines that it contains a material misrepresentation
by which the insurer was induced to enter into the contract.
(7) No
contract of insurance may contain or have endorsed on it, or be made subject
to, any term, condition, stipulation, warranty or proviso providing that the
contract is avoided by reason of any statement in the application for the
contract or inducing the insurer to enter into the contract, unless the term,
condition, stipulation, warranty or proviso is limited to cases in which the
statement is material to the contract, and no contract may be avoided by reason
of the inaccuracy of any such statement unless it is material to the contract.
(8) The
question of materiality in any contract of insurance is a question of fact for
the jury, or for the Court if there is no jury, and no admission, term,
condition, stipulation, warranty or proviso to the contrary contained in the
application or proposal for insurance or in the instrument of contract or in
any agreement or document relating to the contract of insurance has any force
or validity.
(9) Nothing
in this section impairs the effect of any statutory condition required by this
Act to be inserted in any contract of insurance, or of any express provision of
this Act.
(10) This section does not apply to contracts of
automobile insurance.
1999 cI‑5.1 s513
Appraisals
514(1) This section applies to a contract, other than
a contract of hail insurance, containing a condition, statutory or otherwise,
providing for an appraisal to determine specified matters in the event of a
disagreement between the insured and the insurer.
(2) The
insured and the insurer must each appoint an appraiser, and the 2 appraisers so
appointed must appoint an umpire.
(3) The
appraisers must determine the matters in disagreement and, if they fail to
agree, they must submit their differences to the umpire, and the finding in
writing of any 2 determines the matters.
(4) Each
party to the appraisal must pay the appraiser that the party appointed, and
each party must bear equally the expense of the appraisal and the umpire.
(5) If
                                (a)   a
party fails to appoint an appraiser within 7 clear days after being served with
written notice to do so,
                                (b)   the
appraisers fail to agree on an umpire within 15 days after their appointment,
or
                                (c)   an
appraiser or umpire refuses to act or is incapable of acting or dies,
the Court may appoint an appraiser or umpire, as the case
may be, on the application of the insured or of the insurer.
1999 cI‑5.1 s514
Relief against
forfeiture
515 When there has been imperfect compliance with a
statutory condition as to the proof of loss to be given by the insured or
another matter or thing required to be done or omitted to be done by the
insured with respect to the loss and the consequent forfeiture or avoidance of
the insurance in whole or in part and the Court considers it inequitable that
the insurance should be forfeited or avoided on that ground, the Court may
relieve against the forfeiture or avoidance on any terms it considers just.
1999 cI‑5.1 s515
Payment of insurance
money
516 Insurance money is payable in Alberta in lawful
money of Canada.
1999 cI‑5.1 s516
Waivers
517(1) No term or condition of a contract is deemed to
be waived by the insurer in whole or in part unless the waiver is stated in
writing and signed by a person authorized for that purpose by the insurer.
(2) Neither the insurer nor the insured is deemed
to have waived any term or condition of a contract by any act relating to the
appraisal of the amount of loss or to the delivery and completion of proofs or
to the investigation or adjustment of any claim under the contract.
1999 cI‑5.1 s517
Effect of delivery of
policy
518(1) When the policy has been delivered the contract
is as binding on the insurer as if the premium had been paid, although it has
not in fact been paid and although delivered by an officer or agent of the
insurer who had no authority to deliver it.
(2) The
insurer may sue for the unpaid premium and may deduct the amount of the unpaid
premium from the amount for which the insurer is liable under the contract of
insurance.
(3) When
a cheque, bill of exchange or promissory note is given, whether originally or
by way of renewal, for the whole or part of any premium and the cheque, bill of
exchange or promissory note is not honoured according to its tenor, the insurer
may terminate the contract forthwith by giving written notice by registered
mail.
(4) In
making the deduction mentioned in subsection (2), the insurer must allow to the
insured the same discount on any unpaid premium as the insured would be
entitled to if the unpaid premium were paid in cash at the date of the loss.
1999 cI‑5.1 s518
Insurer to furnish forms
519(1) Every insurer, immediately on receipt of a
request, and in any event not later than 60 days after receipt of notice of
loss, must furnish to the insured or person to whom the insurance money is
payable forms on which to make the proof of loss required under the contract.
(2) An
insurer that neglects or refuses to comply with subsection (1) is guilty of an
offence, and, in addition, the provisions of section 520 are not available to
the insurer as a defence to an action brought, after the neglect or refusal,
for the recovery of money payable under the contract of insurance.
(3) If
the insurer has, within 30 days after notification of loss, adjusted the claim
acceptably to the claimant and the adjustment has been signed by the claimant
or the claimant’s agent, or if the amount of loss has been determined by
arbitration or appraisal as provided for in this Act, the insurer is deemed to
have complied with this section.
(4) An insurer by furnishing forms to make proof of
loss is not to be taken to have admitted that a valid contract is in force or
that the loss in question falls within the insurance provided by the contract.
1999 cI‑5.1 s519
When action may be brought
520 No action lies for the recovery of money payable
under a contract of insurance until the expiration of 60 days after proof, in
accordance with the provisions of the contract,
                                (a)   of
the loss, or
                                (b)   of
the happening of the event on which the insurance money is to become payable,
or of any shorter period fixed by the contract of
insurance.
1999 cI‑5.1 s520
Relief from forfeiture
521 When there has been imperfect compliance with a
condition or term of the contract as to proof of loss to be given by the
claimant and a consequent forfeiture or avoidance of the insurance, in whole or
in part, and the Court considers it inequitable that the insurance be forfeited
or avoided on that ground, the Court may relieve against the forfeiture or
avoidance on any terms it considers just.
1999 cI‑5.1 s521
Consolidation of actions
522(1) When several actions are brought for the
recovery of money payable under a contract or contracts of insurance, the Court
may consolidate or otherwise deal with them so that there is only one action
for and in respect of all the claims made in the actions.
(2) When
an action is brought to recover the share of one or more minors, all the other
minors entitled, or the trustees, executors or guardians entitled to receive
payment of the shares of the other minors, must be made parties to the action,
and the rights of all the minors must be determined in one action.
(3) In all actions where several persons are
interested in the insurance money, the Court may apportion among the persons
entitled any sum directed to be paid, and may give all necessary directions and
relief.
1999 cI‑5.1 s522
Payment to payee
domiciled or resident abroad
523 When the person entitled to receive money due
and payable under a contract of insurance, except insurance of the person, is
domiciled or resides in a foreign jurisdiction and payment valid according to
the law of the foreign jurisdiction is made to the person, the payment is valid
and effectual for all purposes.
1999 cI‑5.1 s523
Notice
524(1) Subject to any statutory condition and
subsection (2), any notice given by an insurer for any of the purposes of this
Act, when the mode of giving notice is not otherwise expressly provided for,
may, in the case of a member or person insured, be given by mailing it to the
post office address given in the member’s or person’s original application for
insurance or otherwise notified in writing to the insurer.
(2) Notices
given by provincial companies to policyholders are governed by section 228.
(3) Subject to any statutory condition, delivery of
any written notice to an insurer for any of the purposes of this Act, when the
mode of delivering the notice is not otherwise expressly provided for, may be
delivered by letter to the chief agency of the insurer in Alberta or sent by
registered mail addressed to the insurer, its manager or agent at that chief
agency, or sent in any other manner to an authorized agent of the insurer.
1999 cI‑5.1 s524
Furnishing of copy to
insured
525(1) An insurer must on request furnish to the
insured a true copy of
                                (a)   the
insured’s application or proposal for insurance, and
                                (b)   the
insured’s policy of insurance.
(2) The insurer may charge a reasonable fee to
cover its expenses in issuing any additional copies of the policy other than
the first copy.
1999 cI‑5.1 s525
Inconsistencies
526 No insurer may make a contract of insurance
inconsistent with this Act.
1999 cI‑5.1 s526
Imperfect compliance
527 Any act or omission of the insurer resulting in
imperfect compliance with any of the provisions of this Act does not render a
contract invalid as against the insured.
1999 cI‑5.1 s527
Insurance against loss
through negligence
528 It is lawful for an insurer to contract to
indemnify an insured against financial loss occasioned by reason of liability
to a third person, whether or not the loss is caused by the insured through
negligence or while contravening any municipal or Metis settlement bylaw or any
Act of the Legislature.
1999 cI‑5.1 s528
Claim for indemnity
529(1) In this section, “contract of insurance�
includes disability insurance undertaken as a part of a contract of life
insurance.
(2) Unless a contract of insurance provides
otherwise, a contravention of any criminal or other law in force in Alberta or
elsewhere does not render unenforceable a claim for indemnity under a contract
of insurance except when the contravention is committed by the insured, or by
another person with the consent of the insured, with intent to bring about loss
or damage.
1999 cI‑5.1 s529
Execution against
insured unsatisfied
530 In any case in which a person insured against
liability for injury or damage to persons or property of others has failed to
satisfy a judgment obtained by a claimant for the injury or damage and a writ
of enforcement against the insured in respect of the judgment is returned
unsatisfied, the enforcement creditor has a right of action against the insurer
to recover an amount, not exceeding the face amount of the policy or the amount
of the judgment, in the same manner and subject to the same equities as the
insured would have if the judgment had been satisfied.
1999 cI‑5.1 s530
Insurance as Collateral
Security
Insurance as collateral
security
531(1) A mortgagee must not accept and is not entitled
to receive either directly or through the mortgagee’s agent or employee, and no
officer or employee of a mortgagee may accept or receive, any commission or
other remuneration or benefit in consideration of effecting a contract of
insurance or renewal of a contract of insurance under which contract loss, if
any, is payable to the mortgagee as such.
(2) No
insurer or insurance agent may pay, allow or give any commission or other
remuneration or benefit to a mortgagee or to any person in the employ of or on
behalf of the mortgagee in consideration of effecting a contract of insurance
or renewal of a contract of insurance, under which contract loss, if any, is
payable to the mortgagee as such.
(3) Subsection
(2) does not apply to an insurer that pays, allows or gives any commission or
other remuneration or benefit to a mortgagee or to any person in the employ of
or on behalf of a mortgagee in respect of a contract of insurance if the
mortgagee is a deposit‑taking institution that holds a restricted
insurance agent’s certificate of authority and the contract of insurance falls
within one or more of the classes of insurance specified by the Minister under
section 454(2).
(4) A
contract of title insurance must be in writing, and in addition to the other
requirements established by this Act must expressly limit the liability of the
insurer to a sum stated in the contract.
(5) An
insurer or other person who contravenes this section is guilty of an offence.
(6) No
person who engages in the business of lending money and who has an insurance
agency or any interest in or connection with an insurance agency may require as
a condition of the making of any loan that the borrower must
                                (a)   cancel
any subsisting policy of insurance issued by an insurer licensed to issue such
a policy under this Act, and
                                (b)   take
out other insurance through the lender or through any agency with which the
lender has any such interest or connection.
(7) No
trust corporation may cancel any subsisting policy of insurance that is issued
by an insurer licensed to issue such a policy under this Act that is issued in
respect of any property for which the trust corporation is a trustee, unless
the necessity for the continuation of the insurance does not exist and no other
insurance of a similar description is taken out in respect of the property
during the original term of the first‑mentioned insurance.
(8) A money‑lender who contravenes subsection
(6), every trust corporation that contravenes subsection (7), an insurance
agent who knowingly accepts any proposal for any insurance taken out in
contravention of subsection (6) or (7) and an insurer that issues any contract
of insurance with actual or constructive notice that it has been negotiated in
contravention of subsection (6) or (7) is guilty of an offence.
1999 cI‑5.1 s531
Assignment of premium
refund
532(1) If an insured assigns the right to refund of
premium that may accrue by reason of the cancellation or termination of a
contract of insurance under the terms of the contract of insurance and notice
of the assignment is given by the assignee to the insurer, the insurer must pay
any refund to the assignee despite any provision in this Act or condition in
the contract, whether established under this Act or not, requiring the refund
to be paid to the insured or to accompany any notice of cancellation or
termination to the insured.
(2) If the condition in the contract dealing with
cancellation or termination by the insurer provides that the refund must
accompany the notice of cancellation or termination, the insurer must include
in the notice a statement that, instead of payment of the refund in accordance
with the condition, the refund is being paid to the assignee under this
section.
1999 cI‑5.1 s532
Payment into Court by
insurer
533(1) If an insurer cannot obtain sufficient
discharge for insurance money for which it admits liability, the insurer may
apply to the Court ex parte for an order for the payment of the insurance money
into Court, and the Court may order the payment into Court to be made on any
terms as to costs and otherwise that the Court directs, and may provide to what
fund or name the amount is to be credited.
(2) The receipt of the clerk or other proper
officer of the Court is sufficient discharge to the insurer for the insurance
money paid into Court, and the insurance money must be dealt with according to
the orders of the Court.
1999 cI‑5.1 s533
Filing of copy of
policy, etc., with Superintendent
534(1) The Superintendent may require an insurer to
file with the Superintendent a copy of any form of policy or of the form of
application for any policy or of any endorsement or rider or advertising
material issued or used by the insurer.
(2) This section applies to contracts of life
insurance.
1999 cI‑5.1 s534
Variable life insurance
policies
535(1) In this section and section 536, “variable life
insurance policy� means a life insurance policy for which all or part of the
insurer’s liability under the policy, and the reserves for the liabilities to
be included in the insurer’s annual return pursuant to section 44, vary in
amount depending on the market value of a specific group of assets.
(2) An
insurer must not issue a variable life insurance policy unless
                                (a)   the
insurer files with the Superintendent, not less than 30 days before offering to
undertake any insurance of that kind, the form of the policy, the form of the
application for the policy, the form of all endorsements and riders to be used
in connection with the policy, all advertising material to be issued or used by
the insurer in connection with the insurance, an information folder pertaining
to the insurance and any other material that may be required by the
Superintendent, and
                                (b)   the
Superintendent has issued to the insurer a receipt for the items filed.
(3) The
information folder must provide brief and plain disclosure of all material
facts relating to the contract evidenced by the variable life insurance policy
and must contain a certificate to that effect signed by the chief executive
officer and the chief financial officer of the insurer or any other person that
the Superintendent may require.
(4) An
application for a contract evidenced by a variable life insurance policy must
not be accepted by an insurer until the insurer has delivered to the applicant
for the policy a copy of the latest information folder relating to the policy
that is on file with the Superintendent.
(5) So
long as an insurer continues to issue variable life insurance policies in
respect of which it has filed an information folder, the insurer must,
                                (a)   forthwith
after the occurrence of any material change in the contract or in any other
facts set out in the latest information folder so filed, and
                                (b)   within
13 months after the date of filing of the latest information folder so filed,
or some other period of time that may be ordered by the Minister,
file with the Superintendent a new information folder in
respect of the policies.
1999 cI‑5.1 s535
Regulations
536 The Lieutenant Governor in Council may make
regulations providing for the form and content or either of a life insurance
policy, of a variable life insurance policy, of an application for a life
insurance policy or a variable life insurance policy, of an endorsement or
rider to a policy, of any advertising material or of an information folder
issued or used by an insurer.
1999 cI‑5.1 s536
Subpart 2
Fraternal Societies
Definition
537 In this Subpart, “member�
means a member of a fraternal society who is resident in Alberta.
1999 cI‑5.1 s537
Policy
538(1) When a person becomes a member of a fraternal
society, the society must provide the member with a policy that contains or
that has attached to it all the terms and conditions of the contract of
insurance.
(2) If
the terms and conditions of the contract of insurance between a fraternal
society and its members are changed, deleted or added to, the society must as
soon as practicable provide its members with a notice that contains the change,
deletion or addition.
(3) A
fraternal society must not enforce a term or condition of a contract of
insurance to the prejudice of a member or a beneficiary unless
                                (a)   a
copy of the term or condition has been provided to the member, or
                                (b)   the
society has made reasonable attempts to provide a copy of the term or condition
to the member.
(4) This section does not apply to a fraternal
society that issues a group insurance policy to a person representing the
members of the society.
1999 cI‑5.1 s538
Group insurance policy
539(1) When a person becomes a member of a fraternal
society that issues a group insurance policy to a person representing the
members of the society, the society must provide the member covered under the
group insurance policy with a summary of the insurance benefits provided by the
policy.
(2) If the benefits under a group insurance policy
referred to in subsection (1) are changed, deleted or added to, the society
must as soon as practicable provide its members with a notice of the change,
deletion or addition.
1999 cI‑5.1 s539
Rules deliverable on
demand
540(1) In this section, “insurance fund�, in respect
of a fraternal society, includes all money, securities for money and assets
appropriated by the rules of the society to the payment of insurance
liabilities or appropriated to the management of the insurance branch or
department or division of the society, or otherwise legally available for
insurance liabilities, but does not include funds of a trade union under the Labour Relations Code or under the Public Service Employee Relations Act
appropriated to or applicable for the voluntary assistance of wage‑earners
unemployed or on strike.
(2)
On payment of a reasonable fee, a fraternal society must deliver a copy of all
rules of the society relating to its insurance contracts and to the management
and application of its insurance fund to any person requiring it.
(3) An officer or agent of a fraternal society must
not, with intent to mislead or defraud, give to any person a copy of rules that
are not in force on the pretence that they are the rules then in force.
1999 cI‑5.1 s540
Member’s liability
541(1) The liabilities of a member under the member’s
contract are at any date limited to the assessments, fees and dues that became
payable while the person was a member of the society and of which notice has
been given in accordance with the constitution and rules of the society.
(2) A
member may at any time withdraw from the society by delivering or sending by
registered mail to the society notice in writing of the person’s intention to
withdraw and by paying or tendering the assessments, fees and dues referred to
in subsection (1).
(3) This section is subject to any rules to the
contrary approved by the Superintendent.
1999 cI‑5.1 s541
Notice to members
542(1) Subject to subsection (2), any notice required
to be given to a member for any purpose of this Act or of the rules of the
fraternal society may be given by written or printed notice delivered or sent
to the member by registered mail or left at the member’s last known place of
residence or business or published in the official paper of the society.
(2) A notice of the reduction of any benefit
payable under a contract of insurance or of the increase of the premium payable
under the contract must be sent by registered mail to the member at the
member’s last known place of residence or of business.
1999 cI‑5.1 s542
Subpart 3
Fire Insurance
General Provisions
Application of Subpart
543(1) This Subpart applies to insurance against loss
of or damage to property arising from the peril of fire in any contract made in
Alberta, except
                                (a)   insurance
falling within the classes of aircraft, automobile, boiler and machinery,
inland transportation, marine, plate glass, sprinkler leakage and theft
insurance,
                                (b)   when
the subject‑matter of the insurance is rents, charges or loss of profits,
                                (c)   when
the peril of fire is an incidental peril to the coverage provided, or
                                (d)   when
the subject‑matter of the insurance is property that is insured by an
insurer or group of insurers primarily as a nuclear risk under a policy
covering against loss of or damage to the property resulting from nuclear
reaction or nuclear radiation and from other perils.
(2) Despite subsection (1), this Subpart applies to
insurance of an automobile as provided in section 37(2).
1999 cI‑5.1 s543
Extent of coverage
544(1) Subject to subsection (4) and to section
552(1)(a), in any contract to which this Subpart applies the contract is deemed
to cover the insured property
                                (a)   against
fire, whether resulting from explosion or otherwise, not occasioned by or
happening through
                                          (i)   in the case of goods, their undergoing any process involving the
application of heat, or
                                         (ii)   riot, civil commotion, war, invasion, act of foreign enemy,
hostilities, whether war is declared or not, civil war, rebellion, revolution,
insurrection or military power;
                                (b)   against
lightning, but excluding destruction or loss to electric devices or appliances
caused by lightning or other electric currents, unless fire originates outside
the article itself and only for the destruction or damage that occurs from that
fire;
                                (c)   against
explosion not occasioned by or happening through any of the perils specified in
clause (a)(ii) of natural, coal or manufactured gas in a building not forming
part of a gas works, whether fire ensues from the explosion or not.
(2) Unless
a contract to which this Subpart applies otherwise specifically provides, it
does not cover the insured property against loss or damage caused by
contamination by radioactive material directly or indirectly resulting from
fire, lightning or explosion within the meaning of subsection (1).
(3) If
property insured under a contract covering at a specified location is
necessarily removed to prevent loss or damage or further loss or damage to the
property, that part of the insurance under the contract that exceeds the amount
of the insurer’s liability for any loss incurred must, for 7 days only or for
the unexpired term of the contract if less than 7 days, cover the property
removed and any property remaining in the original location in the proportions
that the value of the property in each of the respective locations bears to the
value of the property in them all.
(4) Nothing
in subsection (1) precludes an insurer’s giving more extended insurance against
the perils mentioned in subsection (1), but in that case this Subpart does not
apply to the extended insurance.
(5) An insurer licensed to undertake fire insurance
may include in its insurance contracts a clause or endorsement providing that,
in the case of livestock insured against death or injury caused by fire or
lightning, the word “lightning� is deemed to include other electric currents.
1999 cI‑5.1 s544
Over-insurance
545(1) No insurance agent may knowingly issue any
contract for fire insurance on property situated in Alberta for an amount that
with any existing contracts exceeds the fair value of the property or of the
interest of the insured in the property.
(2) Any
insurer or insurance agent who knowingly effects, and any insured person who
knowingly procures, insurance on any building or property, or interest in any
building or property, against loss or damage by fire in excess of its insurable
value is guilty of an offence.
(3) Every
adjuster who holds an adjuster’s certificate of authority and who adjusts any
loss by fire to property situated in Alberta must
                                (a)   ascertain
whether there is any over‑insurance on the property,
                                (b)   ascertain
the facts and circumstances, so far as practicable, pertaining to the origin
and the cause of the fire, and
                                (c)   report
the adjuster’s findings in writing, together with any circumstances that, in
the adjuster’s belief, indicate any offence against the law of Alberta or
Canada, to the Fire Commissioner of the Department of Human Resources and
Employment, Government of Alberta and to the Superintendent.
(4) In
the event of the total destruction of any insured property with respect to
which the total amount of insurance money payable is less than the total amount
of insurance on the insured property, the insurer or insurers must return to
the insured person the total amount of insurance premium paid for the excess of
the insurance over the appraised value of the property at the time of the loss,
and the amount must be paid to the insured at the same time and in the same
manner as the loss is paid.
(5) Subsection
(4) does not apply
                                (a)   when
an insured person has knowingly placed insurance in excess of the insurable
value of any building or property or interest in any building or property, or
                                (b)   to
insurance on stocks or merchandise.
(6) No prosecution may be instituted under subsection
(2) without the consent of the Minister of Justice and Attorney General.
1999 cI‑5.1 s545
Application for fire
insurance
546(1) No insurer may make a contract covering
property situated outside the limits of a city, town or village for a term exceeding
12 months without a written application for the contract signed by the
applicant or, in case of the absence or inability of the applicant to make the
application, by the applicant’s agent or by a person having an insurable
interest in the property.
(2) A written application required under subsection
(1) must set out the name, address and occupation of the applicant, the
description, location and occupancy of the property to be insured, its value,
particulars of any mortgage, lien or other encumbrance on the property, the
purpose for which and the location in which any movable property is deposited
or used, particulars of all previous fire claims made by the applicant together
with the name of the company or companies against whom the claims were made,
whether any insurer has cancelled any fire policy or refused fire insurance to
the applicant and any other information the insurer requires.
1999 cI‑5.1 s546
Form of contract
547 After an application for insurance is made, if
it is in writing, any policy sent to the insured is deemed to be intended to be
in accordance with the terms of the application unless the insurer points out
in writing the differences from the application, in which case the insured may,
within 2 weeks after receipt of the notification, reject the policy.
1999 cI‑5.1 s547
Mortgagees and other
payees
548(1) When the loss, if any, under a contract has,
with the consent of the insurer, been made payable to a person other than the
insured, the insurer must not cancel or alter the policy to the prejudice of
that person without notice to that person.
(2) The length of and manner of giving the notice
under subsection (1) must be the same as notice of cancellation to the insured
under the statutory conditions in the contract.
1999 cI‑5.1 s548
Statutory conditions
549(1) The conditions set out in this section are
deemed to be part of every contract in force in Alberta and must be printed on
every policy with the heading “Statutory Conditions�, and no variation or
omission of or addition to any statutory condition is binding on the insured.
(2) In
this section, “policy� does not include an interim receipt or binder.
Statutory Conditions
MISREPRESENTATION 1 If
any person applying for insurance falsely describes the property to the prejudice
of the insurer, or misrepresents or fraudulently omits to communicate any
circumstance which is material to be made known to the insurer in order to
enable it to judge of the risk to be undertaken, the contract shall be void as
to any property in relation to which the misrepresentation or omission is
material.
PROPERTY OF
OTHERS 2 Unless otherwise specifically
stated in the contract, the insurer is not liable for loss or damage to
property owned by any person other than the insured, unless the interest of the
insured therein is stated in the contract.
CHANGE OF
INTEREST 3 The insurer shall be liable
for loss or damage occurring after an authorized assignment under the Bankruptcy and Insolvency Act (Canada)
or change of title by succession, by operation of law, or by death.
MATERIAL
CHANGE 4 Any change
material to the risk and within the control and knowledge of the insured shall
avoid the contract as to the part affected thereby, unless the change is
promptly notified in writing to the insurer or its local agent; and the insurer
when so notified may return the unearned portion, if any, of the premium paid
and cancel the contract, or may notify the insured in writing that, if he
desires the contract to continue in force, he must, within 15 days of the
receipt of the notice, pay to the insurer an additional premium; and in default
of such payment the contract shall no longer be in force and the insurer shall
return the unearned portion, if any, of the premium paid.
TERMINATION OF INSURANCE 5(1) This
contract may be terminated
                                (a)   by
the insurer giving to the insured 15 days’ notice of termination by registered
mail or 5 days’ written notice of termination personally delivered;
                                (b)   by
the insured at any time on request.
(2) Where this
contract is terminated by the insurer
                                (a)   the
insurer shall refund the excess of premium actually paid by the insured over
the pro rata premium for the expired time, but, in no event shall the pro rata
premium for the expired time be deemed to be less than any minimum retained
premium specified; and
                                (b)   the
refund shall accompany the notice unless the premium is subject to adjustment
or determination as to amount, in which case the refund shall be made as soon
as practicable.
(3) Where
this contract is terminated by the insured, the insurer shall refund as soon as
practicable the excess of premium actually paid by the insured over the short
rate premium for the expired time, but, in no event shall the short rate
premium for the expired time be deemed to be less than any minimum retained
premium specified.
(4) The
refund may be made by money, postal or express company money order, or by
cheque payable at par.
(5) The 15
days mentioned in clause (a) of subcondition (1) of this condition commences to
run on the day following the receipt of the registered letter at the post
office to which it is addressed.
REQUIREMENTS AFTER
LOSS 6(1) On the occurrence of any loss of or
damage to the insured property, the insured shall, if such loss or damage is
covered by the contract, in addition to observing the requirements of
Conditions 9, 10 and 11,
                                (a)   forthwith
give notice thereof in writing to the insurer;
                                (b)   deliver
as soon as practicable to the insurer a proof of loss verified by statutory
declaration
                                          (i)   giving a complete inventory of the destroyed and damaged property
and showing in detail quantities, costs, actual cash value and particulars of
amount of loss claimed;
                                         (ii)   stating when and how the loss occurred, and if caused by fire or
explosion due to ignition, how the fire or explosion originated, so far as the
insured knows or believes;
                                        (iii)   stating that the loss did not occur through any wilful act or
neglect or the procurement, means or connivance of the insured;
                                        (iv)   showing the amount of other insurances and the names of other
insurers;
                                         (v)   showing the interest of the insured and of all others in the
property with particulars of all liens, encumbrances and other charges on the
property;
                                        (vi)   showing any changes in title, use, occupation, location,
possession or exposures of the property since the issue of the contract;
                                       (vii)   showing the place where the property insured was at the time of
loss;
                                (c)   if
required, give a complete inventory of undamaged property and showing in detail
quantities, cost, actual cash value;
                                (d)   if
required and if practicable, produce books of account, warehouse receipts and
stock lists, and furnish invoices and other vouchers verified by statutory
declaration, and furnish a copy of the written portion of any other contract.
(2) The
evidence furnished under clauses (c) and (d) of subparagraph (1) of this
condition shall not be considered proofs of loss within the meaning of
Conditions 12 and 13.
FRAUD 7 Any
fraud or wilfully false statement in a statutory declaration in relation to any
of the above particulars, shall vitiate the claim of the person making the
declaration.
WHO MAY GIVE NOTICE
AND PROOF 8 Notice of loss may be
given, and proof of loss may be made, by the agent of the insured named in the
contract in case of absence or inability of the insured to give the notice or
make the proof, and absence or inability being satisfactorily accounted for, or
in the like case, or if the insured refuses to do so, by a person to whom any
part of the insurance money is payable.
SALVAGE 9(1) The
insured, in the event of any loss or damage to any property insured under the
contract, shall take all reasonable steps to prevent further damage to any such
property so damaged and to prevent damage to other property insured hereunder
including, if necessary, its removal to prevent damage or further damage
thereto.
(2) The
insurer shall contribute pro rata towards any reasonable and proper expenses in
connection with steps taken by the insured and required under subparagraph (1)
of this condition according to the respective interests of the parties.
ENTRY, CONTROL,
ABANDONMENT 10 After any loss or
damage to insured property, the insurer shall have an immediate right of access
and entry by accredited agents sufficient to enable them to survey and examine
the property, and to make an estimate of the loss or damage, and, after the
insured has secured the property, a further right of access and entry
sufficient to enable them to make appraisement or particular estimate of the
loss or damage, but the insurer shall not be entitled to control or possession
of the insured property, and without the consent of the insurer there can be no
abandonment to it of insured property.
APPRAISAL 11 In
the event of disagreement as to the value of the property insured, the property
saved or the amount of the loss, those questions shall be determined by
appraisal as provided under the Insurance
Act before there can be any recovery under this contract whether the right
to recovery on the contract is disputed or not, and independently of all other
questions. There shall be no right to an appraisal until a specific demand
therefor is made in writing and until after proof of loss has been delivered.
WHEN LOSS
PAYABLE 12 The loss shall be
payable within 60 days after completion of the proof of loss, unless the
contract provides for a shorter period.
REPLACEMENT 13(1) The
insurer, instead of making payment, may repair, rebuild, or replace the
property damaged or lost, giving written notice of its intention so to do
within 30 days after receipt of the proofs of loss.
(2) In that
event the insurer shall commence to so repair, rebuild, or replace the property
within 45 days after receipt of the proofs of loss, and shall thereafter
proceed with all due diligence to the completion thereof.
ACTION 14 Every
action or proceeding against the insurer for the recovery of any claim under or
by virtue of this contract shall be absolutely barred unless commenced within
one year next after the loss or damage occurs.
NOTICE 15 Any
written notice to the insurer may be delivered at, or sent by registered mail
to, the chief agency or head office of the insurer in the province. Written
notice may be given to the insured named in this contract by letter personally
delivered to him or by registered mail addressed to him at his latest post
office address as notified to the insurer. In this condition, the expression
“registered� means registered in or outside Canada.
1999 cI‑5.1 s549
Limitation of liability
clause
550 A contract containing
                                (a)   a
deductible clause,
                                (b)   a
co‑insurance, average or similar clause, or
                                (c)   a
clause limiting recovery by the insured to a specified percentage of the value
of any property insured at the time of loss, whether or not that clause is
conditional or unconditional,
must have printed or
stamped on the face of the policy in red ink or bold type the words:
                                         This policy contains a
clause which may limit the amount payable.
and, unless these words are so printed or stamped, the
clause is not binding on the insured.
1999 cI‑5.1 s550
Rateable contributions
551(1) When, on the happening of any loss or damage to
insured property, there is in force more than one contract covering the same
interest, the insurers under the respective contracts are each liable to the
insured for its rateable proportion of the loss unless it is otherwise
expressly agreed in writing between the insurers.
(2) For
the purpose of subsection (1), a contract is deemed to be in force despite any
term of the contract that the policy does not cover, come into force, attach or
become insurance with respect to the property until after full or partial
payment of any loss under any other policy.
(3) Nothing
in subsection (1) affects the validity of any division of the sum insured into
separate items, any limits of insurance on specified property, any clause
referred to in section 550 or any contract condition limiting or prohibiting
the having or placing of other insurance.
(4) Nothing
in subsection (1) affects the operation of any deductible clause, and
                                (a)   if
one contract contains a deductible, the prorated proportion of the insurer
under that contract must be first ascertained without regard to the clause and
then the clause must be applied only to affect the amount of recovery under
that contract, and
                                (b)   if
more than one contract contains a deductible, the prorated proportion of the
insurers under those contracts must be first ascertained without regard to the
deductible clauses and then the highest deductible must be prorated among the
insurers with deductibles, and those prorated amounts affect the amount of
recovery under those contracts.
(5) Nothing
in subsection (4) may be construed to have the effect of increasing the
prorated contributions of an insurer under a contract that is not subject to a
deductible clause.
(6) Despite subsection (1), insurance on identified
articles are a first loss insurance as against all other insurance.
1999 cI‑5.1 s551
Special stipulations
552(1) When a contract
                                (a)   excludes
any loss that would otherwise fall within the coverage described in section
544, or
                                (b)   contains
any stipulation, condition or warranty that is or may be material to the risk
including, but not restricted to, a provision in respect to the use, condition,
location or maintenance of the insured property,
the exclusion,
stipulation, condition or warranty is not binding on the insured if it is held
to be unjust or unreasonable by the court before which a question relating to
it is tried.
(2) The insurer and the insured, instead of
proceeding under Statutory Condition 11, may at any time after the loss or
damage make a joint survey, examination, estimate or appraisement of the loss
or damage, in which case the insurer is deemed to have waived all right to make
a separate survey, examination, estimate or appraisement of the loss or damage.
1999 cI‑5.1 s552
Subrogation
553(1) The insurer, on making any payment or assuming
liability for making any payment under a contract of fire insurance, is
subrogated to all rights of recovery of the insured against any person, and may
bring action in the name of the insured to enforce those rights.
(2) If the net amount recovered after deducting the
costs of recovery is not sufficient to provide a complete indemnity for the
loss or damage suffered, that amount must be divided between the insurer and
the insured in the proportions in which the loss or damage has been borne by
them.
1999 cI‑5.1 s553
Subpart 4
Life Insurance
Definitions
554 In this Subpart,
                                (a)   “application�
means an application for insurance or for the reinstatement of insurance;
                                (b)   “beneficiary�
means a person, other than the insured or the insured’s personal
representative, to whom or for whose benefit insurance money is made payable in
a contract or by a declaration;
                                (c)   “contract�
means a contract of insurance;
                                (d)   “creditor’s
group insurance� means insurance effected by a creditor in respect of the lives
of the creditor’s debtors by which the lives of those debtors are insured severally
under a single contract;
                                (e)   “declaration�
means an instrument signed by the insured
                                          (i)   with respect to which an endorsement is made on the policy,
                                         (ii)   that identifies the contract, or
                                        (iii)   that describes the insurance or insurance fund or a part of the
insurance or insurance fund,
                                         in which the insured
designates or alters or revokes the designation of the insured’s personal
representative or a beneficiary as one to whom or for whose benefit insurance
money is to be payable;
                                 (f)   “family
insurance� means insurance in which the lives of the insured and one or more
persons related to the insured by blood, marriage or adoption or by virtue of
an adult interdependent relationship are insured under a single contract
between an insurer and the insured;
                                (g)   “group
insurance� means insurance, other than creditor’s group insurance and family
insurance, in which the lives of a number of persons are insured severally
under a single contract between an insurer and an employer or other person;
                                (h)   “group
life insured� means a person (the “primary person�) whose life is insured by a
contract of group insurance, but does not include a person whose life is
insured under the contract as a person dependent on or related to the primary
person;
                                 (i)   “instrument�
includes a will;
                                 (j)   “insurance�
means life insurance;
                                (k)   “insured�
                                          (i)   in the case of group insurance means, in the provisions of this
Subpart relating to the designation of beneficiaries and the rights and status
of beneficiaries, the group life insured, and
                                         (ii)   in all other cases means the person who
makes a contract with an insurer.
RSA 2000 cI‑3
s554;2002 cA‑4.5 s45
Application of Subpart
Annuity deemed life
insurance
555 For the purposes of this Subpart, an undertaking
entered into by an insurer to provide an annuity, or what would be an annuity
except that the periodic payments may be unequal in amount, is deemed to be and
always to have been life insurance whether the annuity is for
                                (a)   a
term certain,
                                (b)   a
term dependent either solely or partly on a human life, or
                                (c)   a term dependent solely or partly on the
happening of an event not related to a human life.
1999 cI‑5.1 s555
Application of Subpart
556(1) Despite any agreement, condition or stipulation
to the contrary, this Subpart applies to a contract made in Alberta on or after
July 1, 1962 and, subject to subsections (2) and (3), applies to a contract
made in Alberta before that date.
(2) The
rights and interests of a beneficiary for value under a contract that was in
force immediately before July 1, 1962 are those provided in Part 6 of the Act
then in force.
(3) If
the person who would have been entitled to the payment of insurance money if
the money had become payable immediately before July 1, 1962 was a preferred
beneficiary within the meaning of Part 6 of the Act then in force, the insured
must not, except in accordance with that Part,
                                (a)   alter
or revoke the designation of a beneficiary, or
                                (b)   assign,
exercise rights under or in respect of, surrender or otherwise deal with, the
contract,
but this subsection does not apply after a time at which
the insurance money, if it were then payable, would be payable wholly to a
person other than a preferred beneficiary within the meaning of that Part.
1999 cI‑5.1 s556
Application of Subpart
557 In the case of a contract of group insurance
made with an insurer authorized to transact insurance in Alberta at the time
the contract was made, this Subpart applies in determining
                                (a)   the
rights and status of beneficiaries if the group life insured was resident in
Alberta at the time the group life insured became insured, and
                                (b)   the rights and obligations of the group life
insured if the group life insured was resident in Alberta at the time the group
life insured became insured.
1999 cI‑5.1 s557
Issuance of Policy and
Contents
Issuance of policy
558(1) An insurer entering into a contract must issue
a policy.
(2) Subject
to subsection (3), the provisions in
                                (a)   the
application,
                                (b)   the
policy,
                                (c)   any
document attached to the policy when issued, and
                                (d)   any
amendment to the contract agreed on in writing after the policy is issued,
constitute the entire
contract.
(3) In
the case of a contract made by a fraternal society, the policy, the Act or
instrument of incorporation of the society, its constitution, bylaws and rules
and the amendments made from time to time to any of them, the application for
the contract and the medical statement of the applicant constitute the entire
contract.
(4) An insurer must, on request, furnish to the
insured or to a claimant under the contract a copy of the application.
1999 cI‑5.1 s558
Particulars in policy
559(1) This section does not apply to a contract
                                (a)   of
group insurance,
                                (b)   of
creditor’s group insurance, or
                                (c)   made
by a fraternal society.
(2) An
insurer must set out the following particulars in the policy:
                                (a)   the
name or a sufficient description of the insured and of the person whose life is
insured;
                                (b)   the
amount or the method of determining the amount of the insurance money payable,
and the conditions under which it becomes payable;
                                (c)   the
amount or the method of determining the amount of the premium and the period of
grace, if any, within which it may be paid;
                                (d)   whether
the contract provides for participation in a distribution of surplus or profits
that may be declared by the insurer;
                                (e)   the
conditions on which the contract may be reinstated if it lapses;
                                 (f)   the
options, if any,
                                          (i)   of surrendering the contract for cash,
                                         (ii)   of obtaining a loan or an advance payment of the insurance money,
and
                                        (iii)   of obtaining paid‑up or extended
insurance.
1999 cI‑5.1 s559
Particulars in policy
560 In the case of a contract of group insurance or
of creditor’s group insurance, an insurer must set out the following
particulars in the policy:
                                (a)   the
name or a sufficient description of the insured;
                                (b)   the
method of determining the persons whose lives are insured;
                                (c)   the
amount or the method of determining the amount of the insurance money payable,
and the conditions under which it becomes payable;
                                (d)   the
period of grace, if any, within which the premium may be paid;
                                (e)   whether the contract provides for
participation in a distribution of surplus or profits that may be declared by
the insurer.
1999 cI‑5.1 s560
Particulars in certificate
561 In the case of a contract of group insurance, an
insurer must issue, for delivery by the insured to each group life insured, a
certificate or other document in which are set out the following particulars:
                                (a)   the
name of the insurer and an identification of the contract;
                                (b)   the
amount or the method of determining the amount of insurance on the group life
insured and on any person whose life is insured under the contract as a person
dependent on or related to the group life insured;
                                (c)   the circumstances in which the insurance
terminates and the rights, if any, on termination of the group life insured or
of any person whose life is insured under the contract as a person dependent on
or related to the group life insured.
1999 cI‑5.1 s561
Formation of Contract
Insurable interest
562(1) Subject to subsection (2), if at the time a
contract would otherwise take effect the insured has no insurable interest, the
contract is void.
(2) A
contract is not void for lack of insurable interest
                                (a)   if
it is a contract of group insurance, or
                                (b)   if
the person whose life is insured has consented in writing to the insurance
being placed on the person’s life.
(3) If the person whose life is insured is under
the age of 16 years, consent to insurance being placed on the person’s life may
be given by one of the person’s parents or by someone standing in loco parentis
to the person.
1999 cI‑5.1
s562;1999 c31 s2
Persons insurable
563 Without restricting the meaning of the
expression “insurable interest�, a person (the “primary person�) has an
insurable interest in the primary person’s own life and in the life of
                                (a)   the
primary person’s child or grandchild,
                                (b)   the
primary person’s spouse or adult interdependent partner,
                                (c)   any
person on whom the primary person is wholly or in part dependent for or from
whom the primary person is receiving support or education,
                                (d)   the
primary person’s employee, and
                                (e)   any person in the duration of whose life the
primary person has a pecuniary interest.
RSA 2000 cI‑3
s563;2002 cA‑4.5 s45
When contract takes
effect
564(1) Subject to any provision to the contrary in the
application or the policy, a contract does not take effect unless
                                (a)   the
policy is delivered to an insured, the insured’s assign or agent or a
beneficiary,
                                (b)   payment
of the first premium is made to the insurer or its authorized agent, and
                                (c)   no
change has taken place in the insurability of the life to be insured between
the time the application was completed and the time the policy was delivered.
(2) When a policy is issued on the terms applied
for and is delivered to an agent of the insurer for unconditional delivery to a
person referred to in subsection (1)(a), it is deemed to have been delivered to
the insured, but not to the prejudice of the insured.
1999 cI‑5.1 s564
Cheque for premium not
honoured
565(1) When a cheque or other bill of exchange or a
promissory note or other written promise to pay is given for the whole or part
of a premium and payment is not made according to its tenor, the premium or the
part of the premium is deemed not to have been paid.
(2) When a remittance for or on account of a
premium is sent in a registered letter to an insurer and is received by it, the
remittance is deemed to have been received at the time of the registration of
the letter.
1999 cI‑5.1 s565
Payment of premium by
beneficiary
566(1) In this section, “industrial contract� means a
contract of life insurance for an amount not exceeding $2000, exclusive of any
benefit, surplus, profit, dividend or bonus also payable under the contract,
that provides for payment of premiums at fortnightly or shorter intervals or,
if the premiums are usually collected at the home of the insured, at monthly
intervals.
(2) Except
in the case of group insurance, an assignee of a contract, a beneficiary or a
person acting on behalf of one of them or of the insured may pay any premium
that the insured is entitled to pay.
(3) If
a premium, other than the initial premium, is not paid at the time it is due,
the premium may be paid within a period of grace of
                                (a)   30
days, or in the case of an industrial contract 28 days, from and excluding the
day on which the premium is due, or
                                (b)   the
number of days, if any, specified in the contract for payment of an overdue
premium,
whichever is the
longer period.
(4) When the happening of the event on which the
insurance money becomes payable occurs during the period of grace and before
the overdue premium is paid, the contract is deemed to be in effect as if the
premium had been paid at the time it was due, but the amount of the premium,
together with interest at the rate specified in the contract, but not exceeding
6% per year, and the balance, if any, of the current year’s premium may be
deducted from the insurance money.
1999 cI‑5.1 s566
Disclosure of material
facts
567(1) An applicant for insurance and a person whose
life is to be insured must each disclose to the insurer in the application, on
a medical examination, if any, and in any written statements or answers
furnished as evidence of insurability, every fact within the applicant’s or
person’s knowledge that is material to the insurance and is not so disclosed by
the other.
(2) Subject to section 568, a failure to disclose,
or a misrepresentation of, such a fact renders the contract voidable by the
insurer.
1999 cI‑5.1 s567
Disclosure and
misrepresentation by insured
568(1) This section does not apply to a misstatement
of age or to disability insurance.
(2) Subject
to subsection (3), when a contract has been in effect for 2 years during the
lifetime of the person whose life is insured, a failure to disclose, or a
misrepresentation of, a fact required by section 567 to be disclosed does not,
in the absence of fraud, render the contract voidable.
(3) In the case of a contract of group insurance a
failure to disclose, or a misrepresentation of, a fact required by section 567
to be disclosed in respect of a person whose life is insured under the contract
does not render the contract voidable, but if evidence of insurability is
specifically requested by the insurer, the insurance in respect of that person
is voidable by the insurer unless it has been in effect for 2 years during the
lifetime of that person, in which event it is not, in the absence of fraud,
voidable.
1999 cI‑5.1 s568
Non-disclosure and
misrepresentation by insurer
569 If an insurer fails to disclose or misrepresents
a fact material to the insurance, the contract is voidable by the insured, but
in the absence of fraud the contract is not by reason of the failure or
misrepresentation voidable after the contract has been in effect for 2 years.
1999 cI‑5.1 s569
Misstatement of age
570(1) This section does not apply to a contract of
group insurance or of creditor’s group insurance.
(2) Subject
to subsection (3), if the age of a person whose life is insured is misstated to
the insurer, the insurance money provided by the contract must be increased or
decreased to the amount that would have been provided for the same premium at
the correct age.
(3) If a contract limits the insurable age and the
correct age of the person whose life is insured at the date of the application
exceeds the age so limited, the contract is, during the lifetime of that person
but not later than 5 years from the date the contract takes effect, voidable by
the insurer within 60 days after it discovers the error.
1999 cI‑5.1 s570
Misstatement of age
571 In the case of a contract of group insurance or
of creditor’s group insurance, a misstatement to the insurer of the age of a
person whose life is insured does not of itself render the contract voidable
and the provisions, if any, of the contract with respect to age or misstatement
of age apply.
1999 cI‑5.1 s571
Suicide clause
572(1) When a contract contains an undertaking,
express or implied, that insurance money will be paid if a person whose life is
insured commits suicide, the undertaking is lawful and enforceable.
(2) When a contract provides that if a person whose
life is insured commits suicide within a certain period of time the contract is
void or the amount payable under it is reduced, if the contract lapses and is
subsequently reinstated on one or more occasions, the period of time commences
to run from the date of the latest reinstatement.
1999 cI‑5.1 s572
Reinstatement of
contract
573(1) This section does not apply to a contract of
group insurance or to a contract made by a fraternal society.
(2) If
a contract lapses and the insured applies within 2 years for reinstatement of
the contract, if within that time the insured
                                (a)   pays
the overdue premiums and other indebtedness under the contract to the insurer,
together with interest at the rate specified in the contract but not exceeding
6% per year compounded annually, and
                                (b)   produces
                                          (i)   evidence satisfactory to the insurer of the good health, and
                                         (ii)   other evidence satisfactory to the insurer of the insurability,
                                         of the person whose life
was insured,
the insurer must
reinstate the contract.
(3) Subsection
(2) does not apply when the cash surrender value has been paid or an option of
taking paid‑up or extended insurance has been exercised.
(4) Sections 567 and 568 apply, with all necessary
modifications, to the reinstatement of a contract.
1999 cI‑5.1 s573
Designation of
Beneficiaries
Designation of
beneficiary
574(1) An insured may in a contract or by a
declaration designate the insured’s personal representative or a beneficiary to
receive insurance money.
(2) Subject
to section 575, the insured may alter or revoke the designation by a
declaration.
(3) A designation in favour of the “heirs�, “next
of kin� or “estate� of the insured, or the use of words of similar meaning in a
designation, is deemed to be a designation of the personal representative of
the insured.
1999 cI‑5.1 s574
Irrevocable designation
575(1) An insured may in a contract or by a
declaration, other than a declaration that is part of a will, filed with the
insurer at its head or principal office in Canada during the lifetime of the
person whose life is insured designate a beneficiary irrevocably, and in that
event the insured, while the beneficiary is living, must not alter or revoke
the designation without the consent of the beneficiary and the insurance money
is not subject to the control of the insured or of the insured’s creditors and
does not form part of the insured’s estate.
(2) When the insured purports to designate a
beneficiary irrevocably in a will or in a declaration that is not filed as
provided in subsection (1), the designation has the same effect as if the
insured had not purported to make it irrevocable.
1999 cI‑5.1 s575
Designation in will
576(1) A designation in an instrument purporting to be
a will is not ineffective by reason only of the fact that the instrument is
invalid as a will, or that the designation is invalid as a bequest under the
will.
(2) Despite
the Wills Act, a designation in a
will is of no effect against a designation made later than the making of the
will.
(3) When
a designation is contained in a will, if subsequently the will is revoked by
operation of law or otherwise, the designation is revoked.
(4) When a designation is contained in an
instrument that purports to be a will, if subsequently the instrument if valid
as a will would be revoked by operation of law or otherwise, the designation is
revoked.
1999 cI‑5.1 s576
Trustee for beneficiary
577(1) An insured may in a contract or by a
declaration appoint a trustee for a beneficiary and may alter or revoke the
appointment by a declaration.
(2) A payment made by an insurer to a trustee for a
beneficiary discharges the insurer to the extent of the payment.
1999 cI‑5.1 s577
Beneficiary predeceasing
life insured
578(1) If a beneficiary predeceases the person whose
life is insured and no disposition of the share of the deceased beneficiary in
the insurance money is provided in the contract or by a declaration, the share
is payable
                                (a)   to
the surviving beneficiary,
                                (b)   if
there is more than one surviving beneficiary, to the surviving beneficiaries in
equal shares, or
                                (c)   if
there is no surviving beneficiary, to the insured or the insured’s personal
representative.
(2) When 2 or more beneficiaries are designated
otherwise than alternatively but no division of the insurance money is made,
the insurance money is payable to them in equal shares.
1999 cI‑5.1 s578
Enforcement of payment
by beneficiary
579 A beneficiary may enforce for the beneficiary’s
own benefit, and a trustee appointed pursuant to section 577 may enforce as
trustee, the payment of insurance money made payable to the beneficiary or
trustee in the contract or by a declaration in accordance with the provisions
of the contract or declaration, but the insurer may set up any defence that it
could have set up against the insured or the insured’s personal representative.
1999 cI‑5.1 s579
Insurance money not part
of estate
580(1) When a beneficiary is designated, the insurance
money, from the time of the happening of the event on which the insurance money
becomes payable, is not part of the estate of the insured and is not subject to
the claims of the creditors of the insured.
(2) While a designation in favour of a spouse or
adult interdependent partner, child, grandchild or parent, or any of them, of a
person whose life is insured is in effect, the insurance money and the rights
and interests of the insured in the insurance money and in the contract are
exempt from writ proceedings.
RSA 2000 cI‑3
s580;2002 cA‑4.5 s45
Dealings with Contract
Assignment of insurance
581 If a beneficiary
                                (a)   is
not designated irrevocably, or
                                (b)   is
designated irrevocably but has attained the age of 18 years and consents,
the insured may assign, exercise rights under or in respect
of, surrender or otherwise deal with the contract as provided in the contract
or in this Subpart or as may be agreed on with the insurer.
1999 cI‑5.1 s581
Entitlement to dividends
582(1) Despite the irrevocable designation of a
beneficiary, the insured is entitled while living to the dividends or bonuses
declared on a contract unless the contract provides otherwise.
(2) Unless the insured directs otherwise, the insurer
may apply the dividends or bonuses declared on the contract for the purpose of
keeping the contract in force.
1999 cI‑5.1 s582
Third party policies
583(1) Despite the Wills
Act, if in a contract or in an agreement in writing between an insurer and
an insured it is provided that a person named in the contract or in the
agreement has, on the death of the insured, the rights and interests of the
insured in the contract,
                                (a)   the
rights and interests of the insured in the contract do not, on the death of the
insured, form part of the insured’s estate, and
                                (b)   on
the death of the insured, the person named in the contract or in the agreement
has the rights and interests given to the insured by the contract and by this
Subpart and is deemed to be the insured.
(2) If
the contract or agreement provides that, on the death of the insured, 2 or more
persons named in the contract or in the agreement have successively on the
death of each of them, the rights and interests of the insured in the contract,
this section applies successively, with all necessary modifications, to each of
those persons and to each of those persons’ rights and interests in the
contract.
(3) Despite any nomination made pursuant to this
section, the insured may, prior to the insured’s death, assign, exercise rights
under or in respect of, surrender or otherwise deal with, the contract as if
the nomination had not been made, and may alter or revoke the nomination by
agreement in writing with the insurer.
1999 cI‑5.1 s583
Priority of interest
584(1) When an assignee of a contract gives notice in
writing of the assignment to the insurer at its head or principal office in
Canada, the assignee has priority of interest as against
                                (a)   any
assignee other than one who gave notice earlier in a similar manner, and
                                (b)   a
beneficiary other than one designated irrevocably as provided in section 575
before the time the assignee gave notice to the insurer of the assignment in
the manner provided for in this subsection.
(2) When
a contract is assigned as security, the rights of a beneficiary under the
contract are affected only to the extent necessary to give effect to the rights
and interests of the assignee.
(3) When
a contract is assigned unconditionally and otherwise than as security, the
assignee has all the rights and interests given to the insured by the contract
and by this Subpart and is deemed to be the insured.
(4) A provision in a contract to the effect that
the rights or interests of the insured, or in the case of group insurance the
group life insured, are not assignable is valid.
1999 cI‑5.1 s584
Enforcement of right
585 A group life insured may in the group life
insured’s own name enforce a right given to the group life insured under a
contract, subject to any defence available to the insurer against the group
life insured or against the insured.
1999 cI‑5.1 s585
Minors
Minors
586 Except in respect of a minor’s rights as
beneficiary, a minor who has attained the age of 16 years has the capacity of
an adult
                                (a)   to
make an enforceable contract, and
                                (b)   in respect of a contract.
1999 cI‑5.1 s586
Proceedings under
Contract
Proof of claim
587 When an insurer receives sufficient evidence of
                                (a)   the
happening of the event on which insurance money becomes payable,
                                (b)   the
age of the person whose life is insured,
                                (c)   the
right of the claimant to receive payment, and
                                (d)   the
name and age of the beneficiary, if there is a beneficiary,
it must, within 30 days after receiving the evidence, pay
the insurance money to the person entitled to it.
1999 cI‑5.1 s587
Payment of insurance
money
588(1) Subject to subsection (4), insurance money is
payable in Alberta.
(2) Unless
a contract provides otherwise, a reference in the contract to dollars means
Canadian dollars.
(3) If
a person entitled to receive insurance money is not domiciled in Alberta, the
insurer may pay the insurance money to that person or to any other person who
is entitled to receive it on the person’s behalf by the law of the domicile of
the payee.
(4) In the case of a contract of group insurance,
insurance money is payable in the province in which the group life insured was
resident at the time the group life insured became insured.
1999 cI‑5.1 s588
Action on contract made
elsewhere
589 Despite where a contract was made, an action on
it may be brought in a court by a person who is resident in Alberta if the
insurer was authorized to transact insurance in Alberta at the time the
contract was made or at the time the action is brought.
1999 cI‑5.1 s589
Limitation of actions
590(1) Subject to subsection (2), an action or
proceeding against an insurer for the recovery of insurance money must not be
commenced after one year from the furnishing of the evidence required by
section 587, or after 6 years from the happening of the event on which the
insurance money becomes payable, whichever period first expires.
(2) If a declaration has been made under section
593, an action or proceeding referred to in subsection (1) must not be
commenced after one year from the date of the declaration.
1999 cI‑5.1 s590
Persons to whom
insurance money payable
591(1) Until an insurer receives at its head or
principal office in Canada an instrument or an order of a court affecting the
right to receive insurance money, or a notarial copy, or a copy verified by
statutory declaration, of any such instrument or order, it may make payment of
the insurance money and is as fully discharged to the extent of the amount paid
as if there were no such instrument or order.
(2) Subsection (1) does not affect the rights or
interests of any person other than the insurer.
1999 cI‑5.1 s591
Declaration by Court as
to sufficiency of proof
592 When an insurer admits the validity of the
insurance but does not admit the sufficiency of the evidence required by
section 587 and there is no other question in issue except a question under
section 593, the insurer or the claimant may, before or after action is brought
and on at least 30 days’ notice, apply to the Court of Queen’s Bench in
accordance with the Surrogate Rules
for a declaration as to the sufficiency of the evidence furnished, and the
Court may make the declaration or may direct what further evidence is to be
furnished and on the furnishing of the evidence may make the declaration or, in
special circumstances, may dispense with further evidence.
RSA 2000 cI‑3
s592;RSA 2000 c16(Supp) s48
Declaration of
presumption of death
593 When a claimant alleges that the person whose
life is insured should be presumed to be dead by reason of the person not
having been heard of for 7 years, and there is no other question in issue
except a question under section 592, the insurer or the claimant may, before or
after action is brought and on at least 30 days’ notice, apply to the Court of
Queen’s Bench in accordance with the Surrogate
Rules for a declaration as to presumption of the death, and the Court may
make the declaration.
RSA 2000 cI‑3
s593;RSA 2000 c16(Supp) s48
Court order re payment
of insurance money
594(1) On making a declaration under section 592 or
593, the Court of Queen’s Bench may make any order respecting the payment of
the insurance money and respecting costs that it considers just and, subject to
section 596, a declaration or direction or order made under this subsection is
binding on the applicant and on all persons to whom notice of the application
has been given.
(2) A payment made under an order made under
subsection (1) discharges the insurer to the extent of the amount paid.
RSA 2000 cI‑3
s594;RSA 2000 c16(Supp) s48
Order stays pending
action
595 Unless the Court of Queen’s Bench otherwise
orders, an application made under section 592 or 593 operates as a stay of any
pending action with respect to the insurance money.
RSA 2000 cI‑3
s595;RSA 2000 c16(Supp) s48
Right of appeal
596 An appeal lies to the Court of Appeal from any
declaration, direction or order made under section 592, 593 or 594(1).
1999 cI‑5.1 s596
Order re furnishing of
further evidence
597 If the Court of Queen’s Bench finds that the
evidence furnished under section 587 is not sufficient or that a presumption of
death is not established, it may order that the matters in issue be decided in
an action brought or to be brought, or may make any other order it considers
just respecting further evidence to be furnished by the claimant, publication
of advertisements, further inquiry or any other matter or respecting costs.
RSA 2000 cI‑3
s597;RSA 2000 c16(Supp) s48
Order for payment into
Court
598 When an insurer admits liability for insurance
money and it appears to the insurer that
                                (a)   there
are adverse claimants,
                                (b)   the
whereabouts of a entitled person is unknown, or
                                (c)   there
is no person capable of giving and authorized to give a valid discharge for the
insurance money who is willing to do so,
the insurer may, at any time after 30 days from the date of
the happening of the event on which the insurance money becomes payable, apply
to the Court of Queen’s Bench ex parte in accordance with the Surrogate Rules for an order for payment
of the money into court, and the Court may on such notice, if any, as it thinks
necessary make an order accordingly.
RSA 2000 cI‑3
s598;RSA 2000 c16(Supp) s48
Simultaneous deaths
599 Unless a contract or a declaration provides
otherwise, if the person whose life is insured and a beneficiary die at the
same time or in circumstances rendering it uncertain which of them survived the
other, the insurance money is payable in accordance with section 578(1) as if
the beneficiary had predeceased the person whose life is insured.
1999 cI‑5.1 s599
Commutation of instalments
of insurance money
600(1) Subject to subsections (2) and (3), when
insurance money is payable in instalments and a contract, or an instrument
signed by the insured and delivered to the insurer, provides that a beneficiary
does not have the right to commute the instalments or to alienate or assign the
beneficiary’s interest in the instalments, the insurer must not, unless the
insured subsequently directs otherwise in writing, commute the instalments or
pay them to any person other than the beneficiary, and the instalments are not,
in the hands of the insurer, subject to any legal process except an action to
recover the value of necessaries supplied to the beneficiary or the
beneficiary’s minor children.
(2) The
Court of Queen’s Bench may, on the application of a beneficiary and on at least
10 days’ notice, declare that in view of special circumstances
                                (a)   the
insurer may, with the consent of the beneficiary, commute instalments of
insurance money, or
                                (b)   the
beneficiary may alienate or assign the beneficiary’s interest in the insurance
money.
(3) After
the death of the beneficiary, the beneficiary’s personal representative may,
with the consent of the insurer, commute any instalments of insurance money
payable to the beneficiary.
(4) In this section, “instalments� includes
insurance money held by the insurer under section 601.
RSA 2000 cI‑3
s600;RSA 2000 c16(Supp) s48
Insurer holding
insurance money
601(1) An insurer may hold insurance money
                                (a)   subject
to the order of an insured or beneficiary, or
                                (b)   on
trusts or other agreements for the benefit of the insured or the beneficiary,
as provided in the
contract, by an agreement in writing to which it is a party or by a
declaration, with interest at a rate agreed on in the contract, agreement or
declaration or, when no rate is agreed on, at the rate declared from time to
time by the insurer in respect of insurance money so held by it.
(2) The insurer is not bound to hold insurance
money as provided in subsection (1) under the terms of a declaration to which
it has not agreed in writing.
1999 cI‑5.1 s601
Order for payment into
Court
602 If an insurer does not pay the insurance money
to some person competent to receive it or into Court within 30 days after
receipt of the evidence required by section 587, the Court of Queen’s Bench
may, in accordance with the Surrogate
Rules, on application of any person, order that the insurance money or any
part of the insurance money be paid into Court, or may make any other order as
to the distribution of the money that it considers just, and payment made in
accordance with the order discharges the insurer to the extent of the amount
paid.
RSA 2000 cI‑3
s602;RSA 2000 c16(Supp) s48
Fixing of costs
603 The Court of Queen’s Bench may fix, without
taxation, the costs incurred in connection with an application or order made
under section 598 or 602, and may order them to be paid out of the insurance
money or by the insurer or the applicant or otherwise as it considers just.
RSA 2000 cI‑3
s603;RSA 2000 c16(Supp) s48
Insurance money payable
to minor
604(1) When an insurer admits liability for insurance
money payable to a minor and there is no person capable of giving and
authorized to give a discharge for the insurance money who is willing to do so,
the insurer may at any time after 30 days from the date of the happening of the
event on which the insurance money becomes payable pay the money, less the
applicable costs referred to in subsection (2), into Court to the credit of the
minor.
(2) The
insurer may retain out of the insurance money for costs incurred on payment
into Court under subsection (1) the sum of $10 when the amount does not exceed
$1000, and the sum of $15 in other cases, and payment of the remainder of the
money into Court discharges the insurer.
(3) No order is necessary for payment into Court
under subsection (1), but the clerk of the Court of Queen’s Bench or other
proper officer must receive the money on the insurer filing an affidavit
showing the amount payable and the name, date of birth and residence of the
minor, and on the payment’s being made the insurer must forthwith notify the
Public Trustee and deliver to the Public Trustee a copy of the affidavit.
RSA 2000 cI‑3
s604;RSA 2000 c16(Supp) s48
Payment to
representative
605 When it appears that a representative of a
beneficiary who is under disability may under the law of the domicile of the
beneficiary accept payments on behalf of the beneficiary, the insurer may make
payment to the representative and the payment discharges the insurer to the extent
of the amount paid.
1999 cI‑5.1 s605
Miscellaneous Provisions
Agent of insurer
606 No officer, agent or employee of an insurer and
no person soliciting insurance, whether or not the person is an agent of the
insurer, may, to the prejudice of the insured, be deemed to be the agent of the
insured in respect of any question arising out of a contract.
1999 cI‑5.1 s606
Information as to
notices
607 An insurer does not incur any liability for any
default, error or omission in giving or withholding information as to any
notice or instrument that it has received and that affects the insurance money.
1999 cI‑5.1 s607
Subpart 5
Automobile Insurance
Definitions
608 In this Subpart,
                                (a)   “accident�
means an accident arising from the use or operation of an automobile;
                                (b)   “accident
claim� means a claim for loss or damages from bodily injury or death arising
from an accident;
                                (c)   “basic
coverage� means insurance coverage required or provided for under sections 627
and 629;
                                (d)   “contract�
means a contract of automobile insurance;
                                (e)   “insured� means a person insured by a
contract whether named or not and includes any person who is stated in a
contract to be entitled to benefits payable under the insurance mentioned in
section 629 whether described in the contract as an insured person or not.
RSA 2000 cI‑3
s608;2003 c40 s4
Application of Subpart
609(1) This Subpart applies to contracts providing
automobile insurance made or renewed in Alberta on or after January 1, 1969.
(2) This
Subpart does not apply to contracts insuring only against
                                (a)   loss
of or damage to an automobile while in or on described premises,
                                (b)   loss
of or damage to property carried in or on an automobile, or
                                (c)   liability
for loss of or damage to property carried in or on an automobile.
(3) This
Subpart does not apply to a contract providing insurance in respect of an
automobile not required to be registered under the Traffic Safety Act unless it is insured under a contract evidenced
by a form of policy approved under this Subpart.
(4) This Subpart does not apply to a contract
insuring solely the interest of a person who has a lien on, or has as security
legal title to, an automobile and who does not have possession of the
automobile.
RSA 2000 cI‑3
s609;2003 c42 s9
Approval of Forms
Approval of forms
610(1) No insurer may use a form of application,
policy, endorsement or renewal or continuation certificate in respect of
automobile insurance other than a form approved by the Superintendent.
(2) An
insurer may require additional information in an approved application form, but
that additional information does not constitute part of the application for the
purposes of section 613.
(3) When,
in the opinion of the Superintendent, any provision of this Subpart, including
any statutory condition, is wholly or partly inappropriate to the requirements
of a contract or is inapplicable by reason of the requirements of any Act, the
Superintendent may approve a form of policy, or part of a form of policy, or
endorsement evidencing a contract sufficient or appropriate to insure the risks
required or proposed to be insured, and the contract evidenced by the policy or
endorsement in the form so approved is effective and binding according to its
terms even though those terms are inconsistent with, vary, omit or add to any
provision or condition of this Subpart.
(4) Except
as to matters mentioned in section 623, the Superintendent may, if the
Superintendent considers it to be in the public interest, approve a form of
motor vehicle liability policy or endorsement to a motor vehicle liability
policy that extends the insurance beyond that required by this Subpart.
(5) The
Superintendent, in granting an approval under subsection (4), may require the
insurer to charge an additional premium for the extension and to state that
fact in the policy or in any endorsement.
(6) The
Superintendent may approve a form of owner’s policy containing insuring
agreements and provisions in conformity with this Subpart for use by insurers
in general, which, for the purposes of section 612, is the standard owner’s
policy.
(7) When
the Superintendent approves the form referred to in subsection (6), the
Superintendent must cause a copy of the form to be published in The Alberta
Gazette but it is not necessary for the Superintendent to publish endorsement
forms approved for use with the standard owner’s policy.
(8) The
Superintendent may revoke an approval given under this section, and on
notification of the revocation in writing, no insurer may, after receiving the
notification, use or deliver a form that contravenes the notification.
(9) The
Superintendent must, on request of any interested insurer, specify in writing
the Superintendent’s reasons for granting, refusing or revoking an approval of
a form.
(10) The
Superintendent may at any time approve an amendment to the form of anything
that was previously approved by the Superintendent under this section, and
where the Superintendent does so, the Superintendent must have a copy of the
amendment published in The Alberta Gazette, but it is not necessary for the
Superintendent to publish an amendment to endorsement forms approved for use
with the standard owner’s policy.
(11) Ninety
days after the publication of the amendment in The Alberta Gazette or at such
later date as is specified in the Gazette notice and despite anything in this
Act and any contract that is then in force,
                                (a)   the
amendment is deemed to be incorporated into the previously approved form and
into any such contract that incorporated that form, and
                                (b)   the
amendment otherwise becomes effective.
(12) Despite subsection (11), the amendment also
applies to contracts entered into or renewed after the date referred to in that
subsection.
1999 cI‑5.1 s610
Application and Policy
Agents
611 No person carrying on the business of financing
the sale or purchase of automobiles and no automobile dealer or insurance agent
and no officer or employee of such a person, dealer or insurance agent may act
as the agent of an applicant for the purpose of signing an application for
automobile insurance.
1999 cI‑5.1 s611
Application for
insurance
612(1) A copy of the written application, signed by
the insured or the insured’s agent, or, if no signed application is made, a
copy of the purported application, or a copy of the part of the application or
purported application that is material to the contract, must be embodied in,
endorsed on or attached to the policy when issued by the insurer.
(2) If
no signed written application is received by the insurer prior to the issue of
the policy, the insurer must deliver or mail to the insured named in the
policy, or to the agent for delivery or mailing to the insured, a form of
application to be completed and signed by the insured and returned to the
insurer.
(3) Subject
to subsection (5), the insurer must deliver or mail to the insured named in the
policy, or to the agent for delivery or mailing to the insured, the policy or a
true copy of the policy and every endorsement or other amendment to the
contract.
(4) When
a written application signed by the insured or the insured’s agent is made for
a contract, the policy evidencing the contract is deemed to be in accordance
with the application unless the insurer points out in writing to the insured
named in the policy in what respect the policy differs from the application,
and in that event, the insured is deemed to have accepted the policy unless,
within one week from the receipt of the notification, the insured informs the
insurer in writing that the insured rejects the policy.
(5) When
an insurer uses the standard owner’s policy, it may, instead of issuing the
policy, issue a certificate in a form approved by the Superintendent which,
when issued, is of the same force and effect as if it were the standard owner’s
policy, subject to the limits and coverages shown on the certificate by the
insurer and any endorsements issued concurrently with the certificate or
subsequent to the certificate, but at the request of an insured at any time,
the insurer must issue the policy and a copy of the written application or
purported application as required by subsection (1).
(6) When
a certificate is issued pursuant to subsection (5), subsection (8) and section
638(3) apply with all necessary modifications.
(7) When
an insurer issues a certificate pursuant to subsection (5), proof of the
contents may be given by production of a copy of The Alberta Gazette containing
the form of standard owner’s policy approved by the Superintendent.
(8) Every application form and policy must have
printed or stamped in conspicuous type a copy of section 613(1).
1999 cI‑5.1 s612
Misrepresentation, fraud
or violation of condition
613(1) If
                                (a)   an
applicant for a contract
                                          (i)   gives false particulars of the described automobile to be insured
to the prejudice of the insurer, or
                                         (ii)   knowingly misrepresents or fails to disclose in the application
any fact required to be stated in the application,
                                (b)   the
insured contravenes a term of the contract or commits a fraud, or
                                (c)   the
insured wilfully makes a false statement in respect of a claim under the
contract,
a claim by the insured
is invalid and the right of the insured to recover indemnity is forfeited.
(2) No
statement of the applicant may be used in defence of a claim under the contract
unless it is contained in the signed written application for the contract or,
when no signed written application is made, in the purported application, or
part of the application, that is embodied in, endorsed on or attached to the
policy.
(3) No statement contained in a purported copy of
the application, or part of the application, other than a statement describing
the risk and the extent of the insurance, may be used in defence of a claim
under the contract unless the insurer proves that the applicant made the
statement attributed to the applicant in the purported application, or part of
the application.
1999 cI‑5.1 s613
Prohibition on refusal
to issue contract, etc.
613.1(1) In
this section, “adverse contractual action� means
                                (a)   refusing
to process an application for automobile insurance;
                                (b)   refusing
to issue a contract;
                                (c)   refusing
to renew a contract;
                                (d)   terminating
a contract;
                                (e)   cancelling
a contract;
                                 (f)   refusing
to provide any coverage or endorsement;
                                (g)   refusing
to continue any coverage or endorsement;
                                (h)   any
action respecting a contract, not referred to in clauses (a) to (g), that is
prescribed or otherwise described by regulation as adverse contractual action.
(1.1) This
section applies only to adverse contractual action taken in respect of basic
coverage on private passenger vehicles.
(2) An insurer, insurance agent or
insurance broker must not, directly or indirectly, take any adverse contractual
action with respect to an insured or an applicant for a contract except for one
or more of the following reasons:
                                (a)   the
non‑payment of a premium or any portion of a premium;
                                (b)   the
failure of the insured or the applicant for a contract to inform the insurer or
to keep the insurer informed, where requested to do so by the insurer, as to
who is the principal driver of the automobile for which the insurance coverage
is or is to be issued;
                                (c)   in
the case of an insurer that is a provincial or extra‑provincial company,
the insurer is required to cease to undertake or to offer to undertake
insurance pursuant to section 25(2);
                             (c.1)   the
insurer’s licence is suspended or cancelled under section 54, 55, 819 or 819.1;
                                (d)   in
the case of an insurer that is a federally authorized company, the federal
Superintendent of Financial Institutions has ordered or otherwise directed the
insurer to cease carrying on business or insuring risks in Canada;
                                (e)   the
insurer has given notice under section 661.2(3) that the insurer intends to
withdraw from the business of automobile insurance;
                                 (f)   where
permitted by regulation, any reasons not referred to in clauses (a) to (e) that
are prescribed or otherwise described by regulation.
(3) Where
                                (a)   a
premium or any portion of a premium that is owing in respect of a contract is
in arrears,
                                (b)   the
insurer takes adverse contractual action by reason of those arrears not being
paid, and
                                (c)   the
person liable for those arrears applies to the insurer to renew or issue a
contract or to any other insurer to issue a contract,
the insurer may refuse
to renew or issue, as the case may be, a contract to that person until those
arrears are paid to the insurer to which the arrears are owing.
(4) The Lieutenant Governor in Council
may make regulations
                                (a)   permitting
adverse contractual action to be taken other than under subsection (2)(a) to
(e) and prescribing or otherwise describing any reasons not referred to in
subsection (2)(a) to (e) under which adverse contractual action may be taken;
                                (b)   prescribing
or otherwise describing any action, not referred to in subsection (1)(a) to
(g), as adverse contractual action;
                                (c)   governing
the taking of adverse contractual action;
                                (d)   governing
the issuing or renewing of contracts;
                                (e)   governing
any transitional matter concerning the application of this section in respect
of matters dealt with under this section;
                                 (f)   providing for any matter that the Lieutenant
Governor in Council considers advisable for carrying out the purpose and intent
of this section.
2003 c40 s5;2005 c27 s12
Statutory conditions
614(1) Subject to sections 610(3), 615 and 638(2),
                                (a)   the
conditions set out in this section are statutory conditions and are deemed to
be part of every contract and must be printed in every policy with the heading
“Statutory Conditions�, and
                                (b)   no
variation or omission of or addition to a statutory condition is binding on the
insured.
(2) In
this section, “policy� does not include an interim receipt or binder.
Statutory Conditions
In these statutory
conditions, unless the context otherwise requires, the word “insured� means a
person insured by this contract whether named or not.
MATERIAL CHANGE IN
RISK 1(1) The insured named in this
contract shall promptly notify the insurer or its local agent in writing of any
change in the risk material to the contract and within his knowledge.
(2) Without
restricting the generality of the foregoing, the words “change in the risk
material to the contract� include:
                                (a)   any
change in the insurable interest of the insured named in this contract in the
automobile by sale, assignment or otherwise, except through change of title by
succession, death or proceedings under the Bankruptcy
and Insolvency Act (Canada);
and in respect of
insurance against loss of or damage to the automobile,
                                (b)   any
mortgage, lien or encumbrance affecting the automobile after the application
for this contract;
                                (c)   any
other insurance of the same interest, whether valid or not, covering loss or
damage insured by this contract or any portion thereof.
PROHIBITED USE BY
INSURED 2(1) The insured shall not
drive or operate the automobile,
                                (a)   unless
he is for the time being either authorized by law or qualified to drive or
operate the automobile; or
                                (b)   while
his licence to drive or operate an automobile is suspended or while his right
to obtain a licence is suspended or while he is prohibited under order of any
court from driving or operating an automobile; or
                                (c)   while
he is under the age of 16 years or under such other age as is prescribed by the
law of the province in which he resides at the time this contract is made as
being the minimum age at which a licence or permit to drive an automobile may
be issued to him; or
                                (d)   for
any illicit or prohibited trade or transportation; or
                                (e)   in
any race or speed test.
PROHIBITED USE BY
OTHERS (2) The insured shall not
permit, suffer, allow or connive at the use of the automobile,
                                (a)   by
any person,
                                          (i)   unless that person is for the time being either authorized by law
or qualified to drive or operate the automobile; or
                                         (ii)   while that person is under the age of 16 years or under such
other age as is prescribed by the law of the province in which he resides at
the time this contract is made as being the minimum age at which a licence or
permit to drive an automobile may be issued to him;
                                    or
                                (b)   by
any person who is a member of the household of the insured while his licence to
drive or operate an automobile is suspended or while his right to obtain a
licence is suspended or while he is prohibited under order of any court from
driving or operating an automobile; or
                                (c)   for
any illicit or prohibited trade or transportation; or
                                (d)   in
any race or speed test.
REQUIREMENTS WHERE
LOSS OR DAMAGE TO PERSONS
OR PROPERTY 3(1) The insured shall,
                                (a)   promptly
give to the insurer written notice, with all available particulars, of any
accident involving loss or damage to persons or property and of any claim made
on account of the accident;
                                (b)   verify
by statutory declaration, if required by the insurer, that the claim arose out
of the use or operation of the automobile and that the person operating or responsible
for the operation of the automobile at the time of the accident is a person
insured under this contract; and
                                (c)   forward
immediately to the insurer every letter, document, advice or writ received by
him from or on behalf of the claimant.
(2) The
insured shall not,
                                (a)   voluntarily
assume any liability or settle any claim except at his own cost; or
                                (b)   interfere
in any negotiations for settlement or in any legal proceeding.
(3) The
insured shall, whenever requested by the insurer, aid in securing information
and evidence and the attendance of any witness and shall co‑operate with
the insurer, except in a pecuniary way, in the defence of any action or
proceeding or in the prosecution of any appeal.
REQUIREMENTS WHERE
LOSS OR DAMAGE TO AUTOMOBILE 4(1) Where
loss of or damage to the automobile occurs, the insured shall, if the loss or
damage is covered by this contract,
                                (a)   promptly
give notice thereof in writing to the insurer with the fullest information
obtainable at the time;
                                (b)   at
the expense of the insurer, and as far as reasonably possible, protect the
automobile from further loss or damage; and
                                (c)   deliver
to the insurer within 90 days after the date of the loss or damage a statutory
declaration stating, to the best of his knowledge and belief, the place, time,
cause and amount of the loss or damage, the interest of the insured and of all
others therein, the encumbrances thereon, all other insurance, whether valid or
not, covering the automobile and that the loss or damage did not occur through
any wilful act or neglect, procurement, means or connivance of the insured.
(2) Any
further loss or damage accruing to the automobile directly or indirectly from a
failure to protect it as required under subcondition (1) of this condition is
not recoverable under this contract.
(3) No
repairs, other than those that are immediately necessary for the protection of
the automobile from further loss or damage, shall be undertaken and no physical
evidence of the loss or damage shall be removed,
                                (a)   without
the written consent of the insurer; or
                                (b)   until
the insurer has had a reasonable time to make the examination for which
provision is made in Statutory Condition 5.
EXAMINATION OF
INSURED (4) The insured shall submit to
examination under oath, and shall produce for examination at such reasonable
place and time as is designated by the insurer or its representative all
documents in his possession or control that relate to the matters in question,
and he shall permit extracts and copies thereof to be made.
INSURER LIABLE FOR
CASH VALUE OF AUTOMOBILE (5) The
insurer shall not be liable for more than the actual cash value of the
automobile at the time any loss or damage occurs, and the loss or damage shall
be ascertained or estimated according to that actual cash value with proper
deductions for depreciation, however caused, and shall not exceed the amount
that it would cost to repair or replace the automobile, or any part thereof,
with material of like kind and quality, but, if any part of the automobile is
obsolete and out of stock, the liability of the insurer in respect thereof
shall be limited to the value of that part at the time of loss or damage, not
exceeding the maker’s latest list price.
REPAIR OR
REPLACEMENT (6) Except where an appraisal
has been made, the insurer, instead of making payment, may, within a reasonable
time, repair, rebuild or replace the property damaged or lost with other of
like kind and quality if, within 7 days after the receipt of the proof of loss,
it gives written notice of its intention to do so.
NO ABANDONMENT;
SALVAGE (7) There shall be no abandonment of
the automobile to the insurer without the insurer’s consent. If the insurer
exercises the option to replace the automobile or pays the actual cash value of
the automobile, the salvage, if any, shall vest in the insurer.
IN CASE OF
DISAGREEMENT (8) In the event of
disagreement as to the nature and extent of the repairs and replacements
required, or as to their adequacy, if effected, or as to the amount payable in
respect of any loss or damage, those questions shall be determined by appraisal
as provided under the Insurance Act
before there can be recovery under this contract, whether the right to recover
on the contract is disputed or not, and independently of all other questions.
There shall be no right to an appraisal until a specific demand therefor is
made in writing and until after proof of loss has been delivered.
INSPECTION OF
AUTOMOBILE 5 The insured shall
permit the insurer at all reasonable times to inspect the automobile and its
equipment.
TIME AND MANNER OF
PAYMENT OF INSURANCE MONEY 6(1) The
insurer shall pay the insurance money for which it is liable under this
contract within 60 days after the proof of loss has been received by it or,
where an appraisal is made under subcondition (8) of Statutory Condition 4,
within 15 days after the award is rendered by the appraisers.
WHEN ACTION MAY BE
BROUGHT (2) The insured shall not bring
an action to recover the amount of a claim under this contract unless the
requirements of Statutory Conditions 3 and 4 are complied with or until the
amount of the loss has been ascertained as therein provided or by a judgment
against the insured after trial of the issue or by agreement between the parties
with the written consent of the insurer.
LIMITATION OF
ACTIONS (3) Every action or proceeding
against the insurer under this contract in respect of loss or damage to the
automobile shall be commenced within one year next after the happening of the
loss and not afterwards, and in respect of loss or damage to persons or
property shall be commenced within one year next after the cause of action
arose and not afterwards.
WHO MAY GIVE NOTICE AND PROOFS OF
CLAIM 7 Notice
of claim may be given and proofs of claim may be made by the agent of the
insured named in this contract in case of absence or inability of the insured
to give the notice or make the proof, such absence or inability being
satisfactorily accounted for or, in the like case or if the insured refuses to
do so, by a person to whom any part of the insurance money is payable.
TERMINATION 8(1) This
contract may be terminated,
                                (a)   by
the insurer giving to the insured 15 days’ notice of termination by registered
mail or 5 days’ written notice of termination personally delivered;
                                (b)   by
the insured at any time on request.
(2) Where
this contract is terminated by the insurer,
                                (a)   the
insurer shall refund the excess of premium actually paid by the insured over
the pro rata premium for the expired time, but in no event shall the pro rata
premium for the expired time be deemed to be less than any minimum retained
premium specified; and
                                (b)   the
refund shall accompany the notice unless the premium is subject to adjustment
or determination as to the amount, in which case the refund shall be made as
soon as practicable.
(3) Where
this contract is terminated by the insured, the insurer shall refund as soon as
practicable the excess of premium actually paid by the insured over the short
rate premium for the expired time, but in no event shall the short rate premium
for the expired term be deemed to be less than any minimum retained premium
specified.
(4) The
refund may be made by money, postal or express company money order or cheque
payable at par.
(5) The 15
days mentioned in clause (a) of subcondition (1) of this condition commences to
run on the day following the receipt of the registered letter at the post
office to which it is addressed.
NOTICE 9 Any
written notice to the insurer may be delivered at, or sent by registered mail
to, the chief agency or head office of the insurer in the province. Written
notice may be given to the insured named in this contract by letter personally
delivered to him or by registered mail addressed to him at his latest post
office address as notified to the insurer. In this condition, the expression
“registered� means registered in or outside Canada.
1999 cI‑5.1 s614
Conditions not part of
policy
615(1) Except as otherwise provided in the contract,
the statutory conditions set out in section 614 do not apply to insurance
coming within section 640, 641 or 642.
(2) When
a contract does not insure against liability for loss or damage to persons and
property, Statutory Condition 3 is not a part of the policy and may be omitted
from the printing of the conditions in the policy.
(3) When a contract does not insure against loss of
or damage to the automobile, Statutory Condition 4 is not a part of the policy
and may be omitted from the printing of the conditions in the policy.
1999 cI‑5.1 s615
Motor Vehicle Liability
Policies
Coverage of owner’s policy
616(1) Every contract evidenced by an owner’s policy
insures the insured named in the contract (the “named insured�) and every other
person who with the named insured’s consent drives an automobile owned by the
named insured and that falls within the description or definition of automobile
in the contract against liability imposed by law on the named insured or that
other person for loss or damage
                                (a)   arising
from the ownership, use or operation of any such automobile, and
                                (b)   resulting
from bodily injury to or the death of any person and damage to property.
(2) When
the contract evidenced by an owner’s policy also provides insurance against
liability in respect of an automobile not owned by the named insured, an
insurer may stipulate in the contract that the insurance is restricted to those
persons who are specified in the contract.
(3) If
the named insured in an owner’s policy dies, the following persons are deemed
to be the insured under the policy:
                                (a)   the
spouse or adult interdependent partner of the deceased insured if residing in
the same dwelling place at the time of the deceased insured’s death;
                                (b)   in
respect of the described automobile, a newly‑acquired automobile that was
acquired by the deceased insured prior to the deceased insured’s death and a
temporary substitute automobile, all as defined by the policy,
                                          (i)   any person having proper temporary custody of the automobile
until grant of probate or administration to the personal representative of the
deceased insured, and
                                         (ii)   the personal representative of the deceased
insured.
RSA 2000 cI‑3
s616;2002 cA‑4.5 s45
Coverage of non‑owner’s policy
617 Every contract evidenced by a non‑owner’s
policy insures the person named in the contract and any other person who is
specified in the policy against liability imposed by law on the insured named
in the contract or that other person for loss or damage
                                (a)   arising
from the use or operation of an automobile within the definition of automobile
in the policy, other than an automobile owned by or registered in the name of
the insured named in the contract or that other person, and
                                (b)   resulting from bodily injury to or the death
of any person, and damage to property.
1999 cI‑5.1 s617
Effect of lien on
automobile
618 For the purposes of this Subpart, a person is
not deemed to be the owner of an automobile by reason only that the person has
a lien on the automobile or has legal title to the automobile as security.
1999 cI‑5.1 s618
Territorial limits
619 Insurance under section 616 or 617 applies to
the ownership, use or operation of the insured automobile within Canada and the
United States of America and on a vessel plying between ports of those countries.
1999 cI‑5.1 s619
Rights of unnamed
insured
620 Any person insured by but not named in a
contract to which section 616 or 617 applies may recover indemnity in the same
manner and to the same extent as if named in the contract as the insured, and
for that purpose is deemed to be a party to the contract and to have given
consideration for the contract.
1999 cI‑5.1 s620
Liability of insurer
621 Every contract evidenced by a motor vehicle
liability policy must provide that, when a person insured by the contract is
involved in an accident resulting from the ownership, use or operation of an
automobile in respect of which insurance is provided under the contract and
resulting in loss or damage to persons or property, the insurer must
                                (a)   on
receipt of notice of loss or damage caused to persons or property, make such
investigations, conduct such negotiations with the claimant and effect such
settlement of any resulting claims as are considered expedient by the insurer,
                                (b)   defend
in the name and on behalf of the insured and at the cost of the insurer any
civil action that is brought against the insured at any time on account of loss
or damage to persons or property,
                                (c)   pay
all costs taxed against the insured in any civil action defended by the insurer
and any interest accruing after entry of judgment on that part of the judgment
that is within the limits of the insurer’s liability, and
                                (d)   if the injury is to a person, reimburse the
insured for outlay for any medical aid that is immediately necessary at the
time.
1999 cI‑5.1 s621
Liability arising from
contamination
622 Liability arising from contamination of property
carried in an automobile is deemed not to be liability arising from the
ownership, use or operation of that automobile.
1999 cI‑5.1 s622
Exceptions to liability
of insurer
623 The insurer is not liable under a contract
evidenced by a motor vehicle liability policy for any liability
                                (a)   imposed
by any workers’ compensation law on any person insured by the contract, or
                                (b)   resulting from bodily injury to or the death
of any employee of any person insured by the contract while engaged in the
operation or repair of the automobile.
1999 cI‑5.1 s623
Exceptions to liability
of insurer
624 The insurer may provide under a contract
evidenced by a motor vehicle liability policy that it is not liable for one or
both of the following:
                                (a)   to
indemnify any person engaged in the business of selling, repairing,
maintaining, servicing, storing or parking automobiles for any loss or damage
sustained while engaged in the use or operation of or while working on the
automobile in the course of that business unless the person is the owner of the
automobile or is the person’s employee;
                                (b)   for loss of or damage to property carried in
or on the automobile or to any property owned or rented by or in the care,
custody or control of the insured.
1999 cI‑5.1 s624
Exceptions to liability
of insurer
625 Subject to the limitations and exclusions of the
endorsement, the insurer may provide by endorsement to a contract evidenced by
a motor vehicle liability policy that it is not liable for loss or damage
resulting from the ownership, use or operation of any machinery or apparatus,
including its equipment, mounted on or attached to the automobile while that
automobile is at the site of the use or operation of that machinery or
apparatus.
1999 cI‑5.1 s625
Exceptions to liability
of insurer
626(1) The insurer may provide under a contract
evidenced by a motor vehicle liability policy that it is not liable in one or
more of the following cases:
                                (a)   while
the automobile is rented or leased to another person;
                                (b)   while
the automobile is used to carry explosives or to carry radioactive material for
research, education, development or industrial purposes or for purposes incidental
to those purposes;
                                (c)   while
the automobile is used as a taxi‑cab, public omnibus, livery, jitney or
sightseeing conveyance or for carrying passengers for compensation or hire.
(2) Subsection
(1)(a) does not include the use by an employee of the employee’s automobile in
the business of the employee’s employer for which the employee is paid.
(3) In
subsection (1)(b), “radioactive material� means
                                (a)   spent
nuclear fuel rods that have been exposed to radiation in a nuclear reactor,
                                (b)   radioactive
waste material,
                                (c)   unused
enriched nuclear fuel rods, or
                                (d)   any
other radioactive material of such quantity and quality as to be harmful to
persons or property if its container were destroyed or damaged.
(4) Subsection
(1)(c) does not include
                                (a)   the
use by an insured of the automobile for the carriage of another person in
return for the insured’s carriage in the automobile of the other person,
                                (b)   the
occasional and infrequent use by an insured of the automobile for the carriage
of another person who shares the cost of the trip,
                                (c)   the
use by an insured of the automobile for the carriage of a temporary or
permanent domestic servant of the insured or the insured’s spouse or adult
interdependent partner,
                                (d)   the
occasional and infrequent use by an insured of the automobile for the
transportation of children to or from activities conducted as part of an
educational program, or
                                (e)   the use by an insured of the automobile for
the carriage of a client or customer or a prospective client or customer.
RSA 2000 cI‑3
s626;2002 cA‑4.5 s45
Reductions of automobile
accident claim awards
626.1(1) In
this section,
                                (a)   “award�
means a judgment or settlement in respect of an accident claim;
                                (b)   “prescribed�
means provided for in regulations made under subsection (8).
(2) To the extent that an award is for
or is determined with reference to loss of earnings, the amount of the award
must be reduced by
                                (a)   income
tax, if the award is not subjected to income tax,
                                (b)   contributions
by employees, and 50% of contributions by self‑employed persons, under
the Canada Pension Plan (Canada), and
                                (c)   premiums
under the Employment Insurance Act (Canada) relating to the state of
being employed,
that would be or would
have been payable on or with reference to the lost earnings, both before and
after the award, had the accident not occurred.
(3) The whole of or the portion of an
award that is for or is calculated with reference to a head of damages to which
any payment in any form specified in any clause of subsection (4) relates must
be reduced by the aggregate of all payments, both before and after the award,
and net of tax, contributions and premiums referred to in subsection (2)(a) to
(c) paid or payable on those payments (so far as applicable), that
                                (a)   are
received by or on behalf of the claimant as a result of or otherwise in respect
of the accident,
                                (b)   are
in any form specified in subsection (4)(a) to (h), and
                                (c)   relate
to that head of damages.
(4) The forms of payment referred to in
subsection (3) are
                                (a)   medical,
dental, disability, rehabilitation, income continuation or replacement and
hospitalization benefits paid on a no‑fault basis and received by or on
behalf of a resident of a jurisdiction other than Alberta under a contract of
automobile insurance,
                                (b)   medical
care, accident and sickness benefits comprising medical care or goods or
services that are not provided under the Alberta Health Care Insurance Act
or, where the claimant is a resident of another jurisdiction, the equivalent
legislation of that jurisdiction, or that exceed the limits for that care or
those goods or services under that Act or that equivalent legislation,
                                (c)   proceeds
of a policy of insurance that falls within Subpart 6 of Part 5 or the
legislation of another jurisdiction that is equivalent to that Subpart,
                                (d)   benefits
under a prescribed income continuation or replacement plan or scheme,
                                (e)   benefits
under an income replacement plan or scheme referred to in section 15.1,
                                 (f)   disability
pensions under the Canada Pension Plan (Canada) or under any equivalent
legislation of a jurisdiction outside Canada,
                                (g)   compensation
under legislation of another jurisdiction that is equivalent to the Workers’
Compensation Act and its regulations, in respect of disability, medical,
dental, rehabilitation or hospitalization expenses, and
                                (h)   any
other prescribed payments, benefits or compensation under the laws of any
jurisdiction, other than laws referred to in clauses (e), (f) and (g).
(5) The reference in subsection (3) to
payments received is deemed to include circumstances where a legal obligation
to make the payments or to provide related benefits referred to in subsection
(4) to or on behalf of the claimant (netted, where applicable, as referred to
in subsection (3)) has been established or acknowledged before the award.
(6) A person who makes or assumes
liability for a payment referred to in subsection (3) is not subrogated to a
right of recovery of the insured against another person in respect of that
payment.
(7) Nothing in this section shall be
construed as limiting a court’s ability to take into account any premiums or
other amounts paid by a claimant in respect of any benefits, policies, plans or
compensation in any form specified in any clause of subsection (4).
(8) For the purposes of this section, the Lieutenant
Governor in Council may make regulations
                                (a)   respecting
any matter or thing that may be or is to be prescribed for the purposes of this
section, and
                                (b)   defining,
for the purposes of this section, any expression used in it and not defined in
this Subpart.
(9) This
section does not apply to any accident claim that arose in respect of an
accident that occurred before the coming into force of this section.
2003 c40 s6;2005 c27 s13
Limits of motor vehicle
liability policy
627(1) Every contract evidenced by a motor vehicle
liability policy insures, in respect of any one accident, to the limit of not
less than $200 000 exclusive of interest and costs, against liability
resulting from bodily injury to or the death of one or more persons and loss of
or damage to property.
(2) A
contract must be interpreted to mean that when, by reason of any one accident,
liability results from bodily injury or death and from loss of or damage to
property,
                                (a)   claims
against the insured arising out of bodily injury or death have priority to the
extent of $190 000 over claims arising out of loss of or damage to
property, and
                                (b)   claims
against the insured arising out of loss of or damage to property have priority
to the extent of $10 000 over claims arising out of bodily injury or
death.
(3) The
insurer may, instead of specifying a limit in the policy for an inclusive
amount, specify a limit of liability of at least $200 000, exclusive of
interest and costs, against liability resulting from bodily injury to or the
death of one or more persons and a limit of liability of at least
$200 000, exclusive of interest and costs, against liability for loss of
or damage to property.
(4) Nothing
in this Subpart precludes an insurer, with respect to a limit or limits in
excess of those specified in subsection (1) or (3), from increasing or reducing
the limit or limits specified in the contract with respect to the use or
operation of the automobile by a named person, but no reduction is effective
for a limit less than that required under subsection (1) or (3).
(5) The
premium for the insurance required under this section must be shown separately
on the motor vehicle liability policy from the premium for any additional or
other benefits under the policy.
(6) Notwithstanding subsection (4), but
subject to section 613.1, no insurer may refuse a request by an insured or an
applicant for a contract to increase the limit to one of the following amounts,
exclusive of interest and costs, against liability resulting from bodily injury
to or the death of one or more persons and loss of or damage to property:
                                (a)   $500 000;
                                (b)   $1 000 000;
                                (c)   $2 000 000.
RSA 2000 cI‑3
s627;2003 c40 s7
Hospitals Act
628 No amount that is required to be paid to
the Crown under Part 5, Division 2 of the Hospitals
Act may be shown as a separate amount on
                                (a)   an
application for automobile insurance,
                                (b)   a
motor vehicle liability policy, or
                                (c)   a certificate referred to in section 612(5).
1999 cI‑5.1 s628
Accident insurance
benefits
629(1) In this section,
                                (a)   “benefits�
means accident insurance benefits provided for in this section or in
regulations made under subsection (9)(c);
                                (b)   “prescribed�
means provided for by regulations made under this section.
(2) A
contract evidenced by a motor vehicle liability policy insures in respect of an
accident, for accident insurance benefits payable to the prescribed person, in
or to at least the prescribed amounts and in accordance with or subject to this
section and the prescribed terms, conditions, restrictions and exclusions.
(3) The
insurer, on the death of an insured person, must pay
                                (a)   death
benefits, and
                                (b)   actual
funeral costs up to the prescribed maximum amount.
(4) If
an insured person is totally disabled, the insurer must pay a weekly disability
benefit.
(5) The
insurer must pay the prescribed medical payments.
(6) Section
642 applies to the benefits.
(7) and
(8) Repealed 2003 c40 s8.
(9) The
Lieutenant Governor in Council may make regulations
                                (a)   respecting
any matter or thing that may or is to be prescribed for the purposes of this
section;
                                (b)   defining
for the purposes of this section any expression used in it;
                                (c)   increasing
the amount of any of the benefits;
                                (d)   establishing
or governing a system or process for the examination, assessment and treatment
or rehabilitation of bodily injuries suffered by an insured as a result of an
accident in respect of which benefits are payable under this section;
                                (e)   governing
the payment of any fees, levies or other assessments in respect of a system or
process established under clause (d), including, without limitation,
regulations respecting
                                          (i)   the amount of the fees, levies or other assessments or the manner
in which and by whom any of those amounts are to be determined, and
                                         (ii)   to whom and by whom the fees, levies or other assessments are to
be paid;
                                 (f)   providing for any matter that the Lieutenant
Governor in Council considers advisable for carrying out the purpose and intent
of this section.
RSA 2000 cI‑3
s629;2003 c40 s8
Stipulation in motor
vehicle liability policy
630(1) Every motor vehicle liability policy issued in
Alberta must provide that, in the case of liability arising out of the
ownership, use or operation of the automobile in any province or territory,
                                (a)   the
insurer is liable up to the minimum limits established for that province or
territory if those limits are higher than the limits established in the policy,
                                (b)   the
insurer must not set up any defence to a claim that might not be set up if the
policy were a motor vehicle liability policy issued in that province or
territory, and
                                (c)   the
insured, by acceptance of the policy, constitutes and appoints the insurer as
the insured’s irrevocable attorney to appear and defend in any province or
territory in which an action is brought against the insured arising out of the
ownership, use or operation of the automobile.
(2) A provision in a motor vehicle liability policy
in accordance with subsection (1)(c) is binding on the insured.
1999 cI‑5.1 s630
Excess insurance
631(1) Nothing in this Subpart precludes an insurer
from providing insurance under a contract evidenced by a motor vehicle
liability policy restricted to a limit in excess of that provided by another
designated contract evidenced by a motor vehicle liability policy, whether the
designated contract is a first loss insurance or an excess insurance.
(2) When the contract designated in the excess
contract terminates or is terminated, the excess contract is also automatically
terminated.
1999 cI‑5.1 s631
Agreements re deductible
amounts
632 Nothing in this Subpart precludes an insurer
from entering into an agreement with its insured under a contract evidenced by
a motor vehicle liability policy providing that the insured will reimburse the
insurer in an agreed amount in respect of any claim by or judgment in favour of
a third party against the insured, and the agreement may be enforced against
the insured according to its tenor.
1999 cI‑5.1 s632
Coverage under motor
vehicle liability and nuclear energy hazard liability policies
633(1) In this section, “nuclear energy hazard� means
the radioactive, toxic, explosive or other hazardous properties of prescribed
substances under the Nuclear Safety and
Control Act (Canada).
(2) When
an insured, whether named in the contract or not, is covered under a contract
evidenced by a motor vehicle liability policy for loss or damage resulting from
bodily injury to or the death of any person or damage to property arising
directly or indirectly out of a nuclear energy hazard and is, whether named in
the contract or not, also covered against that loss or damage under a contract
evidenced by a policy of nuclear energy hazard liability insurance issued by a
group of insurers and in force at the time of the event giving rise to the loss
or damage,
                                (a)   the
motor vehicle liability insurance is excess to the nuclear energy hazard
liability insurance, and the insurer under the contract of motor vehicle
liability insurance is not liable to pay beyond the minimum limits established by
section 627, and
                                (b)   the
unnamed insured under the contract of nuclear energy liability hazard insurance
may, in respect of the loss or damage, recover indemnity under that contract in
the same manner and to the same extent as if named in the contract as the
insured, and for that purpose the unnamed insured is deemed to be a party to
the contract and to have given consideration for the contract.
(3) For the purpose of this section, a contract of
nuclear energy hazard liability insurance is deemed to be in force at the time
of the event giving rise to the loss or damage, even though the limits of
liability under the contract have been exhausted.
1999 cI‑5.1 s633
Determining which
insurer to be liable
634(1) When a person is insured under more than one contract
evidenced by a motor vehicle liability policy, whether the insurance is first
loss insurance or excess, and a question arises under section 621(b) between an
insurer and the insured or between the insurers as to which insurer must
undertake the obligation to defend in the name and on behalf of the insured,
whether or not any insurer denies liability under its contract, the insured or
any insurer may apply to the Court, and the Court may give any directions that
appear proper with respect to the performance of the obligation.
(2) On
an application under subsection (1), the only parties entitled to notice of the
application and to be heard are the insured and the insured’s insurers, and no
material or evidence used or taken on the application is admissible on the
trial of an action brought against the insured for loss or damage to persons or
property arising out of the use or operation of the automobile in respect of
which the insurance is provided.
(3) An
order under subsection (1) does not affect the rights and obligations of the
insurers in respect of payment of any indemnity under their respective
policies.
(4) When indemnity is provided to the insured under
2 or more contracts and one or more of them are excess insurance, the insurers
must, as between themselves, contribute to the payment of expenses, costs and
reimbursement for which provision is made in section 621 in accordance with
their respective liabilities for damages awarded against the insured.
1999 cI‑5.1 s634
Rights of creditors
635(1) Any person who has a claim against an insured
for which indemnity is provided by a contract evidenced by a motor vehicle
liability policy, even though that person is not a party to the contract, may,
on recovering a judgment in respect of the claim in any province or territory
against the insured, have the insurance money payable under the contract
applied in or toward satisfaction of the judgment and of any other judgments or
claims against the insured covered by the contract and may, on the person’s own
behalf and on behalf of all persons having such judgments or claims, maintain
an action against the insurer to have the insurance money so applied.
(2) No
action may be brought against an insurer under subsection (1) after the
expiration of one year from the final determination of the action against the
insured, including appeals, if any.
(3) A
creditor of the insured is not entitled to share in the insurance money payable
under any contract unless the creditor’s claim is one for which indemnity is
provided for by that contract.
(4) The
right of a person who is entitled under subsection (1) to have insurance money
applied on the person’s judgment or claim is not prejudiced by
                                (a)   an
assignment, waiver, surrender, cancellation or discharge of the contract, or of
any interest in or of the proceeds of the contract, made by the insured after
the happening of the event giving rise to a claim under the contract,
                                (b)   any
act or default of the insured before or after that event in contravention of
this Subpart or of the terms of the contract, or
                                (c)   any
contravention of the Criminal Code
(Canada) or a statute of any province or territory or of any state or the
District of Columbia of the United States of America by the owner or driver of
the automobile,
and nothing mentioned
in clause (a), (b) or (c) is available to the insurer as a defence in an action
brought under subsection (1).
(5) It
is not a defence to an action under this section that an instrument issued as a
motor vehicle liability policy by a person engaged in the business of an
insurer and alleged by a party to the action to be such a policy is not a motor
vehicle liability policy, and this section applies, with all necessary
modifications, to the instrument.
(6) The
insurer may require any other insurers liable to indemnify the insured in whole
or in part in respect of judgments or claims to which reference is made in
subsection (1) to be made parties to the action and contribute according to
their respective liabilities, whether the contribution is rateable or by way of
first loss or excess insurance, as the case may be, and the insured must on
demand furnish the insurer with particulars of all other insurance covering the
subject‑matter of the contract.
(7) When
a person has recovered a judgment against the insured and is entitled to bring
action under subsection (1) and the insurer admits liability to pay the
insurance money under the contract, and the insurer considers that
                                (a)   there
are or may be other claimants, or
                                (b)   there
is no person capable of giving and authorized to give a valid discharge for
payment who is willing to do so,
the insurer may apply
to the Court ex parte for an order for payment of the money into Court, and the
Court may, on the notice, if any, it thinks necessary, make an order
accordingly.
(8) The
receipt of the proper officer of the Court is a sufficient discharge to the
insurer for the insurance money paid into Court under subsection (7), and the
insurance money must be dealt with as the Court may order on application of any
interested person.
(9) Despite
anything contained in a contract evidenced by a motor vehicle liability policy
to the contrary, every contract evidenced by a motor vehicle liability policy
is deemed, for the purposes of this section, to provide all the types of
coverage mentioned in section 626, but the insurer is not liable to a claimant
with respect to the coverage in excess of the limits mentioned in section 627.
(10) When
one or more contracts provide for coverage of a type mentioned in section 624
or 625, except as provided in subsection (12), the insurer may,
                                (a)   with
respect to that type of coverage, and
                                (b)   as
against a claimant,
avail itself of any
defence that it is entitled to set up against the insured, despite subsection
(4).
(11) When
one or more contracts provide for coverage in excess of the limits mentioned in
section 627, except as provided in subsection (12), the insurer may, despite
subsection (4),
                                (a)   with
respect to the coverage in excess of those limits, and
                                (b)   as
against a claimant,
avail itself of any
defence that it is entitled to set up against the insured other than a defence
arising out of a breach of Statutory Condition 2 set out in section 614.
(12) When
a contract provides coverage for loss or damage resulting from bodily injury to
or the death of any person being carried in or on or entering or getting on to
or alighting from an automobile that is operated in the business of carrying
passengers for compensation or hire and insured for that purpose, the insurer may,
despite subsection (4),
                                (a)   with
respect to that type of coverage in excess of the limits mentioned in section
627 or the minimum limits required for that type of coverage under any other
Act, whichever is the greater amount, and
                                (b)   as
against a claimant,
avail itself of any
defence that it is entitled to set up against the insured other than a defence
arising out of a breach of Statutory Condition 2 set out in section 614.
(13) The
insured must reimburse the insurer on demand in the amount that the insurer has
paid by reason of this section and that it would not otherwise be liable to
pay.
(14) When
an insurer denies liability under a contract evidenced by a motor vehicle
liability policy, it must, on application to the Court, be made a third party
in any action to which the insured is a party and in which a claim is made
against the insured by any party to the action in which it is or might be
asserted that indemnity is provided by the contract, whether or not the insured
enters an appearance or defence in the action.
(15) On
being made a third party, the insurer may
                                (a)   contest
the liability of the insured to any party claiming against the insured,
                                (b)   contest
the amount of any claim made against the insured,
                                (c)   deliver
any pleadings in respect of the claim of any party claiming against the
insured,
                                (d)   have
production and discovery from any party adverse in interest, and
                                (e)   examine
and cross‑examine witnesses at the trial,
to the same extent as
if it were a defendant in the action.
(16) An insurer may avail itself of subsection (15)
even though another insurer is defending in the name and on behalf of the
insured an action to which its insured is a party.
1999 cI‑5.1 s635
Regulations re notice of
legal representation
635.1 The Lieutenant Governor in Council may make
regulations requiring a lawyer retained by a plaintiff in an action arising out
of an accident to give notice of that fact to the defendant’s insurer,
including regulations respecting the time at which and the manner in which that
notice must be given.
2003 c40 s9
Payment as release of
claim
636(1) When an insurer makes a payment on behalf of an
insured under a contract evidenced by a motor vehicle liability policy to a
person who is or alleges to be entitled to recover from the insured covered by
the policy, the payment constitutes, to the extent of the payment, a release by
the person or the person’s personal representative of any claim that the person
or the person’s personal representative or any person claiming through or under
the person or by virtue of the Fatal
Accidents Act may have against the insured and the insurer.
(2) Nothing
in this section precludes the insurer making the payment from demanding, as a
condition precedent to the payment, release from the person or the person’s
personal representative or any other person to the extent of the payment.
(3) If
the person commences an action, the Court must adjudicate on the matter first
without reference to the payment, but in giving judgment the Court must take
the payment into account and the person is entitled to judgment only for the
net amount, if any.
(4) The
intention of this section is to permit payments to a claimant without prejudice
to the defendant or the defendant’s insurer, either as an admission of liability
or otherwise, and the fact of any payment must not be disclosed to the judge or
jury until after judgment but before formal entry of the judgment.
(5) The Lieutenant Governor in Council
may make regulations
                                (a)   authorizing
the Court to make an order requiring an insurer to make a payment under this
section to a claimant in advance of any judgment;
                                (b)   prescribing or otherwise describing the
circumstances under which an order referred to in clause (a) may be made.
RSA 2000 cI‑3
s636;2003 c40 s10
Notice of action against
insured to insurer
637(1) Every insured against whom an action is
commenced for damages occasioned by an automobile must give notice of every
notice or process in the action in writing to the insurer within 5 days after
service of every notice or process.
(2) An insured against whom an action is commenced
for damages occasioned by an automobile must, on recovery of a judgment against
the insured, disclose to a judgment creditor entitled to the benefit of any
motor vehicle liability policy particulars of the contract within 10 days after
written demand for the particulars.
1999 cI‑5.1 s637
Regulations re
disclosure of policy limits
637.1 The Lieutenant Governor in Council may
make regulations respecting the disclosure of liability limits under a motor
vehicle liability policy, including, without limitation, regulations respecting
                                (a)   the
circumstances under which the disclosure is to be made;
                                (b)   to
whom and by whom the disclosure is to be made;
                                (c)   the form and manner in which and the time at
which the disclosure must be made.
2003 c40 s11
Physical damage cover
638(1) Subject to section 610(1), the insurer may
provide in a contract any exclusions and limitations in respect of loss of or
damage to or the loss of use of the automobile that it considers necessary.
(2) A
contract or part of a contract providing insurance against loss of or damage to
an automobile and the loss of use of an automobile may contain a clause to the
effect that, in the event of loss, the insurer is required to pay only
                                (a)   an
agreed portion of any loss that may be sustained, or
                                (b)   the
amount of the loss after deduction of a sum specified in the policy,
in either case not
exceeding the amount of the insurance.
(3) When a clause is inserted in accordance with
subsection (2), there must be printed or stamped on the face of the policy in
conspicuous type the words: “This policy contains a partial payment of loss
clause�.
1999 cI‑5.1 s638
Adjustment of claim with
insured
639(1) When a claim is made under any contract other
than a contract evidenced by a motor vehicle liability policy, the insurer
must, despite any agreement, adjust the amount of the claim with the insured
named in the contract as well as with any person having an interest indicated
in the contract.
(2) When notice is given or proof of loss is made
by a person other than the insured because the insured cannot be located or
neglects or refuses or is unable to give notice and make claim under Statutory
Conditions 4 and 7 set out in section 614, the insurer may, despite subsection
(1) but in any event not earlier than 60 days from delivery of the proof
required under Statutory Condition 4(1)(c), adjust and pay the claim to the
other person having an interest indicated in the contract.
1999 cI‑5.1 s639
Limited Accident
Insurances
Uninsured motorist
640(1) If an insurer provides in a contract insurance
against loss resulting from bodily injury to or the death of a person insured
arising out of an accident when
                                (a)   there
is legal liability of another person for the injury or death, and
                                (b)   the
other person has no insurance against the liability for the injury or death or
cannot be identified,
that insurance applies
only in respect of
                                (c)   a
person who sustains bodily injury or death while driving, being carried in or
on or entering or getting on to or alighting from the described automobile in
respect of which insurance against liability arising out of bodily injury to or
the death of a person caused by an automobile or the use or operation of an automobile
is provided under the contract, and
                                (d)   the
insured named in the contract and the spouse or adult interdependent partner of
the insured named in the contract and any dependent relative residing in the
same dwelling place as the insured named in the contract who sustains bodily
injury or death while driving, being carried in or on or entering or getting on
to or alighting from or as a result of being struck by any other automobile
that is defined in the contract for the purposes of that insurance.
(2) The insurance mentioned in subsection (1) does
not apply in respect of a person specified in the contract who has a right of
recovery under the Motor Vehicle Accident
Claims Act or similar legislation of any other province or territory or of
any state or the District of Columbia of the United States of America.
RSA 2000 cI‑3
s640;2002 cA‑4.5 s45;2003 c40 s12
Medical expenses, etc.
641(1) When in a contract an insurer provides
insurance against expenses for medical, surgical, dental, ambulance, hospital,
professional nursing or funeral services, the insurance applies only in respect
of reasonable expenses
                                (a)   of
or incurred for any person who sustains bodily injury or death while driving or
being carried in or on or entering or getting on to or alighting from or, if
not the occupant of another automobile, as a result of being struck by an
automobile owned by the insured named in the contract in respect of which
insurance against liability arising out of bodily injury to or the death of a
person caused by an automobile or the use or operation of an automobile is
provided under the contract, and
                                (b)   of
the insured named in the contract and the spouse or adult interdependent
partner of the insured named in the contract and any dependent relative
residing in the same dwelling place as the insured named in the contract who
sustains bodily injury or death while driving or being carried in or on or
entering or getting on to or alighting from or as a result of being struck by
any other automobile that is defined in the contract for the purposes of that
insurance.
(2) When
an insurer makes a payment under a contract of insurance referred to in
subsection (1), the payment constitutes, to the extent of the payment, a
release by an insured or the insured’s personal representatives of any claim
that
                                (a)   the
insured or the insured’s personal representatives, or
                                (b)   any
person claiming through or under the insured or by virtue of the Fatal Accidents Act
may have against
                                (c)   the
insurer, and
                                (d)   any
other person who may be liable to the insured or the insured’s personal
representatives if that other person is insured under a contract of the same
type specified in subsection (1).
(3) Nothing
in subsection (2) precludes an insurer from demanding, as a condition precedent
to payment, a release to the extent of the payment from the insured or the
insured’s personal representatives or any other person.
(4) The
insurance referred to in subsection (1)(a) is a first loss insurance, and any
other automobile insurance of the same type available to the injured person or
in respect of a deceased person is excess insurance only.
(5) The
insurance referred to in subsection (1)(a) is excess insurance to any other
insurance that is not automobile insurance of the same type indemnifying the
injured person or in respect of a deceased person for the expenses.
(6) The insurance referred to in subsection (1)(b)
is excess insurance to any other insurance indemnifying the injured person or
in respect of a deceased person for the expenses.
RSA 2000 cI‑3
s641;2002 cA‑4.5 s45
Accident insurance
benefits
642(1) When in a contract an insurer provides accident
insurance benefits in respect of the death of or injury to an insured arising
out of an accident, the insurance applies only in respect of
                                (a)   any
person who sustains bodily injury or death while driving or being carried in or
on or entering or getting on to or alighting from or, if not the occupant of
another automobile, as a result of being struck by an automobile owned by the
insured named in the contract in respect of which insurance against liability
arising out of bodily injury to or the death of a person caused by an
automobile or the use or operation of an automobile is provided under the
contract, and
                                (b)   the
insured named in the contract and the spouse or adult interdependent partner of
the insured named in the contract and any dependent relative residing in the
same dwelling place as the insured named in the contract who sustains bodily
injury or death while driving or being carried in or on or entering or getting
on to or alighting from or as a result of being struck by any other automobile
that is defined in the policy for the purposes of the insurance.
(2) When
an insurer makes a payment under a contract of insurance referred to in
subsection (1), the payment constitutes, to the extent of the payment, a
release by the insured or the insured’s personal representatives of any claim
that
                                (a)   the
insured or the insured’s personal representatives, or
                                (b)   any
person claiming through or under the insured or by virtue of the Fatal Accidents Act
may have against
                                (c)   the
insurer, and
                                (d)   any
other person who may be liable to the insured or the insured’s personal
representatives if that other person is insured under a contract of the same
type specified in subsection (1).
(3) Nothing
in subsection (2) precludes an insurer from demanding, as a condition precedent
to payment, a release to the extent of the payment from the insured or the
insured’s personal representatives or any other person.
(4) Subject
to subsection (6), the insurance referred to in subsection (1)(a) is a first
loss insurance, and any other automobile insurance of the same type available
to the injured person or in respect of a deceased person is excess insurance only.
(5) Subject
to subsection (6), the insurance referred to in subsection (1)(b) is excess
insurance over any other automobile insurance of the same type available to the
injured person or in respect of a deceased person.
(6) When
a person is entitled to benefits under more than one contract providing
insurance of the type referred to in this section, the personal representative
of the person entitled to benefits or any person claiming through or under the
person entitled to benefits or by virtue of the Fatal Accidents Act may recover only an amount equal to
                                (a)   one
benefit, if the benefits under the contracts are of the same limit, or
                                (b)   the highest benefit, if the benefits under
the contracts are not of the same limit.
RSA 2000 cI‑3
s642;2002 cA‑4.5 s45; 2003 c40 s12
Demand for particulars
of insurance
643(1) When a person is injured or killed in an
accident in Alberta involving an automobile, that person or the person’s
personal representative may serve
                                (a)   a
demand by registered mail on the owner of the automobile, or
                                (b)   a
demand by registered mail on the insurer of the owner of the automobile,
requiring the owner or
insurer, as the case may be, to state in writing to the person making the
demand whether or not that owner has insurance of the type referred to in
section 641 or 642 and, when the demand is made under clause (a), requiring the
owner, if the owner has that insurance, to state the name of the insurer.
(2) An owner or insurer that does not comply with a
demand made under subsection (1) within 10 days after receiving the demand is
guilty of an offence.
1999 cI‑5.1 s643
Recovery by unnamed
insured
644 Any person insured by but not named in a
contract to which section 640, 641 or 642 applies may recover under the
contract in the same manner and to the same extent as if named in the contract
as the insured, and for that purpose is deemed to be a party to the contract
and to have given consideration for the contract.
1999 cI‑5.1 s644
Priority of payments
645(1) When a person entitled to benefits provided by
insurance under section 641 or 642
                                (a)   is
an occupant of an automobile involved in an accident, the insurer is, in the
first instance, liable for payment of the benefits provided by the insurance,
or
                                (b)   is
a pedestrian and is involved in an automobile accident, the insurer of the
owner of that automobile is, in the first instance, liable for payment of the
benefits provided by the insurance.
(2) Nothing in this section affects the operation
of sections 641(2) to (6) and 642.
1999 cI‑5.1 s645
Payment of insurance
money into Court
646(1) Where an insurer admits liability for insurance
money payable under section 640, 641 or 642 and it appears that
                                (a)   there
are adverse claimants,
                                (b)   the
whereabouts of an insured entitled to the insurance money is unknown, or
                                (c)   there
is no person capable of giving and authorized to give a valid discharge for the
insurance money who is willing to do so,
the insurer may, at
any time after 30 days after the date on which the insurance money becomes payable,
apply to the Court ex parte for an order for payment of the money into Court,
and the Court may make an order accordingly on any notice it thinks necessary.
(2) The receipt of the proper officer of the Court
is sufficient discharge to the insurer for the insurance money paid into Court,
and the insurance money must be dealt with as the Court orders.
1999 cI‑5.1 s646
Limitation re
commencement of action
647 An action or proceeding against an insurer under
a contract in respect of insurance provided under section 640, 641 or 642 must
be commenced within the limitation period specified in the contract, but in no
event may the limitation period be less than one year after the happening of
the accident.
1999 cI‑5.1 s647
Demand on claimant for
particulars
648 When a person makes a claim for damages in
respect of bodily injury or death sustained by the person or any other person
while driving or being carried in or on or entering or getting on to or
alighting from or as a result of being struck by an automobile, the claimant
must, if required by the person against whom the claim is made or by someone
acting on the person’s behalf, furnish to or for that person full particulars
of all insurance available to the claimant under contracts falling within the
scope of section 641 or 642, and of any payments of insurance money made or to
be made under those contracts.
1999 cI‑5.1 s648
Variations in policy
649 Subject to section 610(1), an insurer may in a
policy
                                (a)   provide
insurance that is less extensive in scope than the insurance referred to in
section 640, 641 or 642, and
                                (b)   provide the terms of the contract that
relate to the insurance referred to in section 640, 641 or 642.
1999 cI‑5.1 s649
Other Insurance
Proportioning liability
of insurer
650(1) Subject to section 633, insurance under a
contract evidenced by a valid owner’s policy is, in respect of liability
arising from or occurring in connection with the ownership, use or operation of
an automobile owned by the insured named in the contract and within the
description or definition of an automobile in the policy, a first loss
insurance, and insurance attaching under any other valid motor vehicle
liability policy is excess insurance only.
(2) Subject
to subsection (1) and to sections 633, 641 and 642, if the insured named in a
contract has or places any other valid insurance, whether against liability for
the ownership, use or operation of or against loss of or damage to an
automobile or otherwise, of the named insured’s interest in the subject‑matter
of the contract or any part of the contract, the insurer is liable only for its
rateable proportion of any liability, expense, loss or damage.
(3) In
subsection (2), “rateable proportion� means,
                                (a)   if
there are 2 insurers liable and each has the same policy limits, that each of
the insurers is liable to share equally in any liability, expense, loss or
damage, or
                                (b)   if
there are 2 insurers liable with different policy limits, that the insurers are
liable to share equally up to the limit of the smaller policy limit,
and if there are more than 2 insurers liable, clauses (a)
and (b) apply with all necessary modifications.
1999 cI‑5.1 s650
Minor Injuries
Minor injury
650.1(1) In
this section, “minor injury� means an injury as defined or otherwise described
by regulation as a minor injury.
(2) In an accident claim, the amount
recoverable as damages for non‑pecuniary loss of the plaintiff for a
minor injury must be calculated or otherwise determined in accordance with the
regulations.
(3) The Lieutenant Governor in Council
may make regulations
                                (a)   defining
minor injury or otherwise describing what constitutes a minor injury;
                                (b)   providing
for the classification of or categories of minor injuries;
                                (c)   providing
for the assessment of injuries, including, without limitation, regulations
establishing or adopting guidelines, best practices or other methods for
assessing whether an injury is or is not a minor injury;
                                (d)   governing
damages, including the amounts of or limits on damages, for non‑pecuniary
loss for minor injuries;
                                (e)   governing
deductible amounts or limits and the application of those amounts or limits in
respect of damages for non‑pecuniary loss for minor injuries;
                                 (f)   providing
for or otherwise setting out circumstances under which a minor injury to which
this section would otherwise apply is exempt from the operation of this
section;
                                (g)   governing
the application of this section in respect of injuries arising out of an
accident where
                                          (i)   it is unclear as to whether or not this section applies to those
injuries, or
                                         (ii)   the injuries consist of a combination of minor injuries to which
this section applies and injuries to which this section does not apply;
                                (h)   establishing
and governing a system or process under which a person or a committee, panel or
other body may review any injury to a person and give an opinion as to whether
or not the injury is a minor injury;
                                 (i)   providing
for the appointment or designation of persons or of members of committees,
panels or other bodies for the purposes of a system or process established
under clause (h);
                                 (j)   governing
the payment of any fees, levies and other assessments in respect of a system or
process established under clause (h), including, without limitation,
regulations respecting
                                          (i)   the amount of the fees, levies or other assessments or the manner
in which and by whom any of those amounts are to be determined, and
                                         (ii)   by whom and to whom the fees, levies or other assessments are to
be paid;
                                (k)   governing
any transitional matter concerning the application of this section in respect
of matters dealt with under this section;
                                 (l)   providing
for any matter that the Lieutenant Governor in Council considers advisable for
carrying out the purpose and intent of this section.
(4) This
section does not apply to any accident claim that arose in respect of an
accident that occurred before the coming into force of this section.
2003 c40 s13
Structured
Judgments
Regulations re
structured judgments
650.2(1) The
Lieutenant Governor in Council may make regulations
                                (a)   authorizing
the Court to make an order directing that any award for damages in respect of
an action for loss or damages from bodily injury or death arising from an
accident must be paid periodically on the terms the Court considers
appropriate;
                                (b)   prescribing or otherwise describing the
circumstances under which an order referred to in clause (a) may be made.
2003 c40 s13
Subrogation
Subrogation of insurer
to rights of recovery
651(1) Subject to section 626.1(6), an insurer that
makes any payment or assumes liability for making any payment under a contract
is subrogated to all rights of recovery of the insured against any person and
may bring action in the name of the insured to enforce those rights.
(2) When
the net amount recovered whether by action or on settlement is, after deduction
of the costs of the recovery, not sufficient to provide complete indemnity for
the loss or damage suffered, the amount remaining must be divided between the
insurer and the insured in the proportion in which the loss or damage has been
borne by them.
(3) When
the interest of an insured in any recovery is limited to the amount provided
under a clause in the contract described in section 638(2), the insurer has
control of the action.
(4) When
the interest of an insured in any recovery exceeds that referred to in
subsection (3) and the insured and the insurer cannot agree as to
                                (a)   the
solicitors to be instructed to bring the action in the name of the insured,
                                (b)   the
conduct and carriage of the action or any related matters,
                                (c)   any
offer of settlement or the apportionment of an offer of settlement, whether an
action has been commenced or not,
                                (d)   the
acceptance or the appointment of any money paid into Court,
                                (e)   the
apportionment of costs, or
                                 (f)   the
launching or prosecution of an appeal,
either party may apply
to the Court for the determination of the matters in question, and the Court
may make any order it considers reasonable having regard to the interests of
the insured and the insurer in any recovery in the action or proposed action or
in any offer of settlement.
(5) On
an application under subsection (4), the only parties entitled to notice and to
be heard on the application are the insured and the insurer, and no material or
evidence used or taken on the application is admissible on the trial of an
action brought by or against the insured or the insurer.
(6) A settlement or release given before or after
an action is brought does not bar the rights of the insured or the insurer, as
the case may be, unless they have concurred in the settlement or release.
RSA 2000 cI‑3
s651;2003 c40 s14
Automobile
Insurance
Rate Board
Definitions
652 In this section and sections 653 to
660.2,
                                (a)   “additional
coverage� means automobile insurance that may be made available by an insurer
that supplements basic coverage, including, without limitation, collision
coverage;
                                (b)   “Board� means the Automobile Insurance Rate
Board.
RSA 2000 cI‑3
s652;2003 c40 s15
Rate Board established
653(1) The
Automobile Insurance Rate Board is established consisting of
                                (a)   at
least 3 but not more than 7 members appointed by the Lieutenant Governor in
Council,
                                (b)   a
consumer representative appointed by the Minister, and
                                (c)   the
Superintendent.
(2) The consumer representative referred
to in subsection (1)(b)
                                (a)   must
have expertise and experience in consumer issues in the area of automobile
insurance, and
                                (b)   must
not be
                                          (i)   an adjuster,
                                         (ii)   a director or officer of a provincial company,
                                        (iii)   a director or officer of an extra‑provincial company,
                                     (iii.1)   a director or officer of an extra‑provincial Crown insurer
or of an affiliate of an extra‑provincial Crown insurer,
                                        (iv)   a director or officer of a federally authorized company,
                                         (v)   a director or officer of a financial institution,
                                        (vi)   an insurance agent,
                                       (vii)   a director or officer of a life company,
                                      (viii)   a director or officer of a mutual provincial company,
                                        (ix)   a director or officer of a property and casualty company, or
                                         (x)   a special broker.
(3) The Superintendent is a non‑voting
member of the Board.
(4) The Lieutenant Governor in Council
may
                                (a)   appoint
one of the members of the Board, other than the Superintendent, as chair and
another as vice‑chair, and
                                (b)   fix
the remuneration and provide for the payment of expenses to the members who are
not employees of the Government.
(5) The term of office of a member of
the Board referred to in subsection (1)(a) must not exceed 3 years.
(6) A member of the Board referred to in
subsection (1)(a) may be reappointed for 2 additional terms of office.
(7) Notwithstanding subsection (6), the
chair of the Board is always eligible to be reappointed as chair.
(8) A person appointed as a member of
the Board continues to hold office after the expiry of the member’s term until
the member is reappointed, the member’s successor is appointed or 12 months has
elapsed, whichever occurs first.
(9) Subject to the approval of the
Lieutenant Governor in Council, the Board may from time to time appoint one or
more persons having special technical or other knowledge to inquire into and
report to the Board in respect of any matter before the Board or in respect of
which the Board considers it necessary to have information for the proper
carrying out of its duties and functions.
(10) A person appointed by the Board
pursuant to subsection (9) must be paid the remuneration specified by the
Lieutenant Governor in Council.
(11) A majority of the members of the
Board constitutes a quorum for the purpose of exercising its powers and
performing its duties and functions.
(12) An
order, direction, approval or other instrument that the Board is permitted or
required to make may be made on its behalf by the chair, the vice‑chair
or any other member of the Board.
(13) An
order, direction, approval or other instrument purporting to be signed by the
chair, the vice‑chair or a member of the Board on behalf of the Board is
admissible in evidence in any proceedings as proof, in the absence of evidence
to the contrary,
                                (a)   that
the order, direction, approval or instrument is the act of the Board, and
                                (b)   that
the person signing it was authorized to do so
without proof of the
appointment of the individual signing as a member of the Board, or the
individual’s designation as chair or vice‑chair, as the case may be, or
of the individual’s signature.
(14) The Board may make rules governing
its procedures.
(15) The Regulations Act does not
apply to rules made under subsection (14).
(16) Every member of the Board has the
power of a commissioner under the Public Inquiries Act.
(17) In accordance with the Public
Service Act, there may be appointed the staff and other persons required by
the Board.
(18) The
Lieutenant Governor in Council may make regulations authorizing the Board to
charge and collect from licensed insurers of automobiles fees, levies or other
assessments for the Board’s operations and for matters under its
administration, including, without limitation, regulations respecting the
amount of the fees, levies and other assessments and the manner in which and
the times at which they must be paid.
RSA 2000 cI‑3
s653;2003 c40 s15;2005 c27 s14
Powers and duties of
Board
654(1) In
addition to the powers and duties imposed or conferred on the Board under this
Act or the regulations, the Board must exercise and perform any other powers
and duties assigned to it by the Minister or prescribed by the regulations.
(2) Notwithstanding anything in this
Subpart, the Minister may, if the Minister considers it appropriate to do so,
exercise any of the powers and perform any of the duties or functions of the
Board under this Act.
(3) If there is an inconsistency or
conflict between an action taken by the Board and an action taken by the
Minister under subsection (2), the action taken by the Minister prevails.
RSA 2000 cI‑3
s654;2003 c40 s15
Annual report
655(1) The
Board must make and submit to the Minister an annual report on the operations
of the Board.
(2) The
Minister must lay the report before the Legislative Assembly if it is then
sitting or, if it is not then sitting, within 15 days after the commencement of
the next sitting.
2003 c40 s15
Premiums for Basic
Coverage
Premiums for basic
coverage
656(1) The
Board must, in accordance with the regulations, determine and set premiums for
basic coverage annually, or for such shorter period as may be prescribed by the
regulations.
(2) Notwithstanding subsection (1), the
Lieutenant Governor in Council may determine and set premiums for basic
coverage for any period the Lieutenant Governor in Council considers
appropriate.
(3) The premiums for basic coverage must
be set by the Board or the Lieutenant Governor in Council, as the case may be,
before the beginning of the period for which the premiums are effective.
(4) The Lieutenant Governor in Council
may make regulations
                                (a)   respecting
the setting of premiums for basic coverage, including, without limitation,
regulations
                                          (i)   establishing or providing for the manner of establishing criteria
to be applied in setting the premiums;
                                         (ii)   governing the method of setting the premiums based on the
criteria established under subclause (i);
                                (b)   respecting
the refund or credit of any amounts paid for basic coverage under contracts
made or renewed before or after, or in effect on, the coming into force of this
section, including, without limitation, regulations respecting the contracts in
respect of which a refund or credit is to be made, the amount of the refund or
credit and the manner in which insurers must provide the refund or credit;
                                (c)   requiring
insurers to provide reports and information to the Board, including, without
limitation, regulations respecting the nature and contents of the reports or
information to be provided, the form in which the reports or information is to
be provided and the times at which the reports or information is to be
provided;
                                (d)   respecting
the use and confidentiality of the reports and information referred to in
clause (c);
                                (e)   governing
any transitional matter concerning the application of this section in respect
of matters dealt with under this section, including, without limitation,
regulations governing the application of this section in respect of contracts
in effect when this section comes into force;
                                 (f)   providing
for any other matter that the Lieutenant Governor in Council considers advisable
for carrying out the purpose and intent of this section.
(5) Nothing
in this section precludes an insurer from charging a premium for basic coverage
that is less than the corresponding premium for basic coverage established by
the Board or the Lieutenant Governor in Council, as the case may be.
2003 c40 s15;2005 c27
s15
Discounts and surcharges
657 The Lieutenant Governor in Council may
make regulations respecting discounts and surcharges on premiums for basic
coverage, including, without limitation, regulations
                                (a)   establishing
or providing for the manner of establishing criteria to be applied in
calculating the amount or level of discounts and surcharges;
                                (b)   governing
the method of calculating the amount or level of discounts and surcharges based
on the criteria established under clause (a);
                                (c)   governing
any transitional matter concerning the application of this section in respect
of matters dealt with under this section;
                                (d)   providing for any other matter that the
Lieutenant Governor in Council considers advisable for carrying out the purpose
and intent of this section.
2003 c40 s15
Procedures
658(1) The
Superintendent may establish written procedures to be followed by insurers in
determining the amount payable for basic coverage by an insured or an applicant
for a contract based on
                                (a)   the
relevant amount of the premium for basic coverage determined pursuant to
section 656, and
                                (b)   the
amount of any discount or surcharge on that premium determined pursuant to
section 657.
(2) The
Regulations Act does not apply to written procedures established under
subsection (1).
2003 c40 s15
Prohibition
659(1) No
insurer may charge or collect from an insured or an applicant for a contract an
amount for basic coverage that is greater than the relevant premium determined
pursuant to section 656 less any discount or plus any surcharge on that premium
determined pursuant to section 657.
(2) Subsection
(1) does not apply to a contract made or renewed before the coming into force
of this section.
2003 c40 s15
Premiums
for
Additional Coverage
Premiums for additional
coverage
660(1) Every
licensed insurer of automobiles must, in accordance with the regulations, file
with the Board the schedule of premiums it proposes to charge for additional
coverage.
(2) No insurer may charge the proposed
premiums for additional coverage unless the premiums have first been filed with
the Board.
(3) This
section applies in respect of proposed premiums to be charged for additional
coverage in respect of a contract made or renewed after the coming into force
of this section.
2003 c40 s15
Review of premiums for
additional coverage
660.1 The Board must, after an
insurer has filed its schedule of premiums for additional coverage with the
Board under section 660, review those premiums and if it is of the opinion that
any one or more of the premiums are not based on appropriate actuarial
principles, the Board may report the matter to the Minister.
2003 c40 s15
Regulations
660.2 The Lieutenant Governor in Council may make
regulations
                                (a)   respecting
annual reports under section 655;
                                (b)   respecting
the filing with the Board of a schedule of premiums for additional coverage
under section 660;
                                (c)   respecting
the period of time during which the Board must review a schedule of premiums for
additional coverage filed with the Board under section 660;
                                (d)   requiring
an insurer to give notice to the Registrar of Motor Vehicle Services whenever a
contract is terminated, cancelled or not renewed, including regulations
respecting the form and manner in which the notice must be given;
                                (e)   governing
or otherwise respecting any matter related to premiums, charges, surcharges,
discounts or other incentives related to automobile insurance;
                             (e.1)   respecting
the refund or credit of any amounts paid for additional coverage under
contracts made or renewed before or after, or in effect on, the coming into
force of this section, including, without limitation, regulations respecting
the contracts in respect of which a refund or credit is to be made, the amount
of the refund or credit and the manner in which insurers must provide the
refund or credit;
                                 (f)   respecting
any matter that is to be prescribed under this Subpart;
                                (g)   defining for the purposes of this Subpart
and the regulations made under this Subpart any term or expression used in this
Subpart that is not defined in this Act.
2003 c40 s15;2005 c27
s16
Application of
Government approved industry plan
661(1) An insurer licensed under this Act to carry on
automobile insurance must participate in and is subject to the terms and
conditions of any Government approved industry plan to ensure a market for
automobile insurance to all owners of automobiles in Alberta and for operators
of automobiles in Alberta who hold operator’s licences issued under the Traffic Safety Act.
(2) A
copy of the constitution, bylaws, rules and regulations of a proposed plan must
be filed with the Superintendent for approval.
(3) On
acceptance of the filing and approval by the Superintendent under subsection
(2), the plan is deemed to be a Government approved industry plan to ensure a
market for automobile insurance to all owners of automobiles in Alberta and for
operators of automobiles in Alberta who hold operator’s licences issued under
the Traffic Safety Act.
(4) A
copy of a proposed change to be made in the constitution, bylaws, rules or
regulations of a plan or a notice of termination of a plan must be filed with
the Superintendent at least 15 days before the change or termination is
proposed to be effective, and that change or termination must not take place
unless approved by the Superintendent.
(5) When
an insurance agent receives an application and effects coverage under a plan by
binding a risk, the agent is bound by the applicable terms and conditions of
the plan in existence at that time for the duration of the coverage so placed.
(6) The Lieutenant Governor in Council
may make regulations
                                (a)   governing
the operation of a Government approved industry plan;
                                (b)   determining
the amounts to be paid by each insurer for the operation of a Government
approved industry plan;
                                (c)   providing
for any other matter that the Lieutenant Governor in Council considers
advisable for carrying out the purpose and intent of this section.
(7) Repealed 2003 c40 s16.
RSA 2000 cI‑3
s661;2003 c40 s16;2003 c42 s9
Premium freeze
661.1(1) In
this section,
                                (a)   “insured�
includes an applicant for a contract;
                                (b)   “insurer�
includes a servicing carrier under a Government approved industry plan referred
to in section 661;
                                (c)   “order�
includes any directions given by the Superintendent pursuant to subsection (5)
in respect of an order made under subsection (2);
                                (d)   “premium�
means a premium for automobile insurance and includes any rates, fees,
surcharges or other amounts defined or otherwise described as a premium in an
order made under subsection (2);
                                (e)   “rating
program� means the rules, criteria, policies or guidelines of any nature used
or adopted by an insurer to determine the premiums to be charged to an insured
for automobile insurance.
(2) The Lieutenant Governor in Council
may by order, effective on the date or period provided for in the order, freeze
premiums prescribed or otherwise described in the order at the levels
prescribed or otherwise described in the order.
(3) Without limiting the generality of
subsection (2), an order made under subsection (2) may
                                (a)   be
made retroactive to the extent set out or otherwise provided for in the order;
                                (b)   exempt
in whole or in part a contract or class of contracts from the application of the
order;
                                (c)   exempt
in whole or in part an automobile or class of automobiles from the application
of the order;
                                (d)   exempt
in whole or in part an insurer or class of insurers from the application of the
order;
                                (e)   prescribe
or otherwise describe the premiums and the levels of premiums to which the
order applies;
                                 (f)   prohibit
an insurer from charging premiums in excess of the premiums provided for under
the order;
                                (g)   contain
provisions specifying the manner or method or the procedures to be used by an
insurer to determine premiums for contracts made or renewed after the effective
date of the order, including provisions suspending or modifying the insurer’s
rating program or any part of the insurer’s rating program;
                                (h)   suspend or
modify the application or operation of any one or more provisions of this Act
during any period that the order is in effect;
                                 (i)   suspend
or modify any decision of the Alberta Automobile Insurance Board;
                                 (j)   be
specific or general in its application;
                                (k)   define
or otherwise describe rates, fees, surcharges or other amounts as premiums for
the purpose of the order;
                                 (l)   contain
provisions
                                          (i)   requiring an insurer to reimburse or otherwise provide a refund
or credit to an insured for any part of any premiums paid by the insured as a
result of the insurer’s non-compliance with the order, and
                                         (ii)   specifying the manner in which and the time at which any
reimbursement, refund or credit of those premiums must be made;
                               (m)   define
any word or term used in this section that is not otherwise defined in this
section;
                                (n)   include
any other provisions that the Lieutenant Governor in Council considers
necessary or advisable for carrying out the purpose and intent of this section.
(4) An order made under subsection (2)
                                (a)   is
in effect for any period stated in the order, and
                                (b)   may
be renewed for any further period or periods the Lieutenant Governor in Council
considers appropriate.
(5) The Superintendent may give
directions to an insurer with respect to an order made under subsection (2),
including, without limitation, directions with respect to
                                (a)   determining
premiums during the period for which the order is in effect, and
                                (b)   the
application of the insurer’s rating program in respect of premiums to which the
order applies,
for the purposes of
ensuring that the order is carried out within the spirit and intent of this
section and the order.
(6) Section 789 applies to an order made
under subsection (2).
(7) The Regulations Act does not
apply to an order made under subsection (2).
2003 c40 s17
Withdrawal from business
661.2(1) For
the purposes of this section, an insurer is withdrawing from the business of
automobile insurance if the insurer does anything that results or is likely to
result in a significant reduction in the amount of premiums written by the
insurer for automobile insurance in any part of Alberta, including any of the
following actions that have or are likely to have that result:
                                (a)   refusing
to process applications for automobile insurance;
                                (b)   refusing
to issue a contract;
                                (c)   refusing
to renew a contract;
                                (d)   terminating
a contract;
                                (e)   cancelling
a contract;
                                 (f)   refusing
to provide any coverage or endorsement in respect of a contract;
                                (g)   refusing
to continue any coverage or endorsement in respect of a contract;
                                (h)   taking
actions that directly or indirectly result in termination of contracts between
the insurer and the insurance agents and insurance brokers who solicit or
negotiate contracts on behalf of the insurer;
                                 (i)   reducing
the ability of insurance agents or insurance brokers to solicit or negotiate
contracts on behalf of the insurer;
                                 (j)   reducing
the insurer’s ability to act as a servicing carrier or ceasing to act as a
servicing carrier under a Government approved industry plan referred to in section
661;
                                (k)   engaging
in any activity or failing to act as prescribed or otherwise described in the
regulations.
(2) An insurer must not withdraw from
the business of automobile insurance except in accordance with this section.
(3) An insurer that intends to withdraw
from the business of automobile insurance must file with the Superintendent a
notice in the form prescribed by the Superintendent.
(4) The notice must specify the date
that the insurer intends to withdraw from the business of automobile insurance
and must be filed at least 180 days before that date.
(5) The Superintendent may require the
insurer to provide the information, material and evidence that the
Superintendent considers necessary in addition to the information, material and
evidence required to be provided in the notice.
(6) Except as otherwise directed by the
Superintendent, an insurer who files a notice under subsection (4) must not,
after the date of withdrawal specified in the notice, or such other date of
withdrawal provided for in subsection (7), issue any contracts or renew any
existing contracts.
(7) The Superintendent may
                                (a)   authorize
the insurer to withdraw from the business of automobile insurance before the
date specified in the notice under subsection (4), or
                                (b)   prohibit
the insurer from withdrawing from the business of automobile insurance until a
date specified by the Superintendent that is not later than 90 days after the
date specified in the notice under subsection (4).
(8) Except as otherwise directed by the Superintendent,
an insurer that withdraws from the business of automobile insurance pursuant to
this section may not, for a period prescribed in the regulations, issue
contracts or otherwise carry on the business of automobile insurance.
(9) The Lieutenant Governor in Council
may make regulations prescribing or otherwise describing any activity or
failure to act for the purposes of subsection (1)(k).
(10) An
insurer who fails to comply with a requirement of this section is guilty of an
offence and liable to a fine of not more than $100 000.
2003 c40 s18
Methods
of Resolving Disputes
Dispute resolution
661.3(1) In
this section, “complaint� means any complaint or issue that an insured or an
applicant for a contract has with an insurer, an insurance agent or an
insurance broker with respect to
                                (a)   premiums,
                                (b)   the
basis on which a premium was determined,
                                (c)   the
availability of insurance,
                                (d)   the
taking of adverse contractual action referred to in section 613.1,
                                (e)   fault
as determined by an insurer in relation to a claim, or
                                 (f)   any
matter not referred to in clauses (a) to (e) prescribed by regulation,
but does not include,
in respect of an accident, any matter concerning the determination of liability
or the amount of damages where an action has been commenced or likely to be
commenced in respect of that accident.
(2) The Lieutenant Governor in Council
may make regulations providing for one or more dispute resolution systems or
processes by means of which complaints may be resolved or otherwise dealt with
and, without restricting the generality of the foregoing, may make regulations
                                (a)   prescribing,
for the purposes of subsection (1)(f), any other matter for which a dispute
resolution system or process may be used;
                                (b)   governing
the procedure to be followed or otherwise used in making and resolving or
attempting to resolve a complaint;
                                (c)   governing
the mechanisms to be used under the dispute resolution system or process,
including
                                          (i)   the appointment and use of committees or other bodies to deal with
complaints;
                                         (ii)   the use of mediation and the appointment of mediators;
                                        (iii)   the use of arbitration and the appointment of arbitrators;
                                (d)   governing
the duties, functions and powers of the Superintendent, if any, in respect of a
dispute resolution system or process;
                                (e)   governing
the remedies available under a dispute resolution system or process;
                                 (f)   providing for any matter that the Lieutenant
Governor in Council considers advisable for carrying out the purpose and intent
of this section.
2003 c40 s18
Previous
Law and Unforeseen
and Transitional Matters
Provision of insurance pursuant to previous law
661.4(1) In
this section and sections 661.5 and 661.6,
                                (a)   “amended
Act� means the previous Act as amended by the amending Act;
                                (b)   “amending
Act� means the Insurance Amendment Act, 2003 (No. 2);
                                (c)   “previous
Act� means the Insurance Act as it read immediately before being amended
by the amending Act.
(2) The Lieutenant Governor in Council
may make regulations governing the application of the amended Act or the
previous Act with respect to any contract, insurer, insurance agent, insurance
broker, adjuster, insured, applicant for a contract or automobile or any one or
more classes of any of them or for the purposes of providing a contract or determining
a premium in a manner not provided for under the amended Act and, without
restricting the generality of the foregoing, may make regulations
                                (a)   providing
that the previous Act will continue to apply instead of the amended Act;
                                (b)   providing
that only certain provisions of the amended Act will apply;
                                (c)   providing
that only certain provisions of the previous Act will continue to apply;
                                (d)   providing
that where the previous Act or any of its provisions continue to apply, the
Automobile Insurance Rate Board is to carry out the duties and functions and
exercise the powers of the Alberta Automobile Insurance Board in respect of the
previous Act, subject to any necessary modifications;
                                (e)   modifying,
where regulations are made under clauses (a) to (d), any provision of the
amended Act or the previous Act, as the case may be, to the extent that the
Lieutenant Governor in Council considers necessary in order to carry out the
purpose and intent of this section;
                                 (f)   providing for any other matter that the Lieutenant
Governor in Council considers advisable for carrying out the purpose and intent
of this section.
2003 c40 s18
Regulations re
unforeseen matters
661.5(1) The
Lieutenant Governor in Council may make regulations in respect of matters
coming under the amending Act or the amended Act that the Minister, after
consulting with the Superintendent, considers to be unforeseen, that are not
provided for or that are insufficiently provided for under the amending Act or
the amended Act.
(2) A regulation made under subsection
(1) is repealed on the earliest of the following:
                                (a)   the
coming into force of an amendment to a statute that provides for the matter
dealt with in the regulation made under subsection (1);
                                (b)   the
coming into force of a regulation that repeals the regulation made under
subsection (1);
                                (c)   the
expiration of 3 years from the day that the regulation made under subsection
(1) comes into force.
(3) The repeal of a regulation under
subsection (2)(b) or (c) does not affect anything done, incurred or acquired
under the authority of that regulation before the repeal of that regulation.
(4) A regulation must not be made under
subsection (1) after the expiration of 3 years from the day that this section
comes into force, but any regulation made under subsection (1) that is in force
on the expiration of that 3‑year period remains in force until it is
repealed under subsection (2).
(5) A
regulation must not be made under subsection (1) altering the provisions of
subsection (2) or extending the 3‑year period provided for in subsection
(4).
2003 c40 s18
Transitional matters
661.6 The Minister may make regulations
                                (a)   respecting
the transition of any matter from the previous Act to the amended Act;
                                (b)   to
deal with any difficulty or impossibility resulting from the transition from
the previous Act to the amended Act.
2003 c40 s18
Subpart 6
Accident and Sickness Insurance
Definitions
662 In this Subpart,
                                (a)   “application�
means a written application for insurance or for the reinstatement of insurance;
                                (b)   “beneficiary�
means a person designated or appointed in a contract or by a declaration, other
than the insured or the insured’s personal representative, to whom or for whose
benefit insurance money payable in the event of death by accident is to be
paid;
                                (c)   “blanket
insurance� means that class of group insurance that covers loss arising from
specific hazards incidental to or defined by reference to a particular activity
or activities;
                                (d)   “contract�
means a contract of insurance;
                                (e)   “creditor’s
group insurance� means insurance effected by a creditor in which the lives or
well‑being or the lives and well‑being of a number of the
creditor’s debtors are insured severally under a single contract;
                                 (f)   “declaration�
means an instrument signed by the insured
                                          (i)   with respect to which an endorsement is made on the policy,
                                         (ii)   that identifies the contract, or
                                        (iii)   that describes the insurance or insurance fund or a part of the
insurance or insurance fund,
                                         in which the insured
designates or alters or revokes the designation of the insured’s personal
representative or a beneficiary as one to whom or for whose benefit the
insurance money that is payable in the event of death by accident is to be
paid;
                                (g)   “family
insuranceâ€? means insurance in which the lives or well‑being or the lives
and well‑being of the insured and one or more persons related to the
insured by blood, marriage or adoption or by virtue of an adult interdependent
relationship are insured under a single contract between an insurer and the
insured;
                                (h)   “group
insurance� means insurance, other than creditor’s group insurance and family
insurance, in which the lives or well‑being or the lives and well‑being
of a number of persons are insured severally under a single contract between an
insurer and an employer or other person;
                                 (i)   “group
person insured� means a person (the “primary person�) who is insured under a
contract of group insurance and on whom a right is conferred by the contract,
but does not include a person who is insured under the contract as a person
dependent on or related to the primary person;
                                 (j)   “instrument�
includes a will;
                                (k)   “insurance�
means accident insurance, sickness insurance or accident insurance and sickness
insurance;
                                 (l)   “insured�,
                                          (i)   in the case of group insurance means, in the provisions of this
Subpart relating to the designation of beneficiaries or of personal
representatives as recipients of insurance money and their rights and status,
the group person insured, and
                                         (ii)   in all other cases means the person who makes a contract with an
insurer;
                               (m)   “person insured� means a person in respect
of an accident to whom, or in respect of whose sickness, insurance money is
payable under a contract, but does not include a group person insured.
RSA 2000 cI‑3
s662;2002 cA‑4.5 s45
Application of Subpart
663(1) Despite any agreement, condition or stipulation
to the contrary, this Subpart applies to a contract made in Alberta on or after
October 1, 1970, and this section and sections 662, 664, 665, 673, 676, 677,
679, 682 and 684 to 701 apply also to a contract made in Alberta before that
day.
(2) Sections
309, 310, 311, 312, 314, 320a and 320d of The
Alberta Insurance Act, RSA 1955 c159, in force on January 1, 1970 apply to
a contract made in Alberta before October 1, 1970.
(3) This
Subpart does not apply to
                                (a)   accidental
death insurance,
                                (b)   creditor’s
group insurance,
                                (c)   disability
insurance, or
                                (d)   insurance provided under section 640, 641 or
642.
1999 cI‑5.1 s663
Application of Subpart
664 In the case of a contract of group insurance
made with an insurer authorized to transact insurance in Alberta at the time
the contract was made, this Subpart applies in determining
                                (a)   the
rights and status of beneficiaries and personal representatives as recipients
of insurance money, if the group person insured was resident in Alberta at the
time the group person insured became insured, and
                                (b)   the rights and obligations of the group
person insured if the group person insured was resident in Alberta at the time
the group person insured became insured.
1999 cI‑5.1 s664
Issue of policy
665 An insurer entering into a contract must issue a
policy.
1999 cI‑5.1 s665
Exceptions and
particulars in policy
666(1) This section does not apply to
                                (a)   a
contract of group insurance, or
                                (b)   a
contract made by a fraternal society.
(2) An
insurer must set out the following in the policy:
                                (a)   the
name or a sufficient description of the insured and of the person insured;
                                (b)   the
amount or the method of determining the amount of the insurance money payable,
and the conditions under which it becomes payable;
                                (c)   the
amount or the method of determining the amount of the premium and the period of
grace, if any, within which it may be paid;
                                (d)   the
conditions on which the contract may be reinstated if it lapses;
                                (e)   the term of the insurance or the method of
determining the day on which the insurance commences and terminates.
1999 cI‑5.1 s666
Particulars in group
policy
667 In the case of a contract of group insurance, an
insurer must set out the following in the policy:
                                (a)   the
name or a sufficient description of the insured;
                                (b)   the
method of determining the group persons insured and persons insured;
                                (c)   the
amount or the method of determining the amount of the insurance money payable,
and the conditions under which it becomes payable;
                                (d)   the
period of grace, if any, within which the premium may be paid;
                                (e)   the term of the insurance or the method of
determining the day on which the insurance commences and terminates.
1999 cI‑5.1 s667
Termination and
replacement of group policies
668(1) In this section,
                                (a)   “original
maximum benefit period� means, in relation to a contract of group insurance,
the maximum period provided under the contract for the payment of any benefit
payable under the contract in respect of loss of income;
                                (b)   “specified
time period� means, in relation to a contract of group insurance, a continuous
period of 6 months following the termination of the contract or a benefit
provision in the contract, or any longer continuous period provided for in the
contract instead of the 6‑month period.
(2) When
a contract of group insurance or a benefit provision in a contract of group
insurance is terminated, the insurer continues, as though the contract or benefit
provision had remained in full force and effect, to be liable to or in respect
of any group person insured under the contract to pay benefits under the
contract relating to
                                (a)   loss
of income because of disability,
                                (b)   death,
                                (c)   dismemberment,
or
                                (d)   accidental
damage to natural teeth,
arising from an
accident or sickness that occurred before the termination of the contract or
benefit provision, if the disability, death, dismemberment or accidental damage
to natural teeth is reported to the insurer within the specified time period.
(3) Despite
subsection (2), an insurer does not remain liable, under a contract or benefit
provision described in that subsection, to pay a benefit for loss of income for
the recurrence, after the termination of that contract or benefit provision, of
a disability that recurs after a continuous period of 6 months, or a longer
period provided for in the contract, during which the group person insured was
not disabled.
(4) An
insurer that is liable under subsection (2) to pay a benefit for loss of income
as a result of the disability of a group person insured is not liable to pay
benefits for any period longer than the period remaining of the original
maximum benefit period in respect of the disability of the group person insured.
(5) If
a contract of group insurance (in this section called the “replacement
contract�) is entered into within 31 days of the termination of another
contract of group insurance (in this section called the “other contract�) and
insures the same group or part of the group insured under the other contract,
                                (a)   the
replacement contract is deemed to provide that any person who was insured under
the other contract at the time of its termination is insured under the
replacement contract from and after the termination of the other contract if
                                          (i)   the insurance on that person under the other contract terminated
solely by reason of the termination of the other contract, and
                                         (ii)   the person is a member of a class eligible for insurance under
the replacement contract,
                                (b)   every
person who was insured under the other contract and who is insured under the
replacement contract is entitled to receive credit for satisfaction of any
deductible earned before the effective date of the replacement contract, and
                                (c)   no
person who was insured under the other contract may be excluded from
eligibility under the replacement contract solely because of not being actively
at work on the effective date of the replacement contract,
but if the replacement contract provides that the full
benefits required to be paid pursuant to subsection (2) by the insurer of the
other contract are to be paid under the replacement contract instead, the
insurer of the other contract is not liable to pay those benefits.
1999 cI‑5.1 s668
Certificate covering
group insurance
669(1) Except as provided in subsection (2), in the
case of a contract of group insurance an insurer must issue for delivery by the
insured to each group person insured a certificate or other document in which
is set out the following:
                                (a)   the
name of the insurer and a sufficient identification of the contract;
                                (b)   the
amount or the method of determining the amount of insurance on the group person
insured and on any person insured;
                                (c)   the
circumstances under which the insurance terminates and the rights, if any, on
the termination of the group person insured and of any person insured.
(2) This section does not apply to a contract of
blanket insurance or to a contract of group insurance of a non‑renewable
type issued for a term of 6 months or less.
1999 cI‑5.1 s669
Exceptions or reductions
670(1) Subject to section 671 and except as otherwise
provided in this section, the insurer must set out in the policy every
exception or reduction affecting the amount payable under the contract, either
in the provision affected by the exception or reduction or under a heading such
as “Exceptions� or “Reductions�.
(2) If
the exception or reduction affects only one provision in the policy, it must be
set out in that provision.
(3) If
the exception or reduction is contained in an endorsement, insertion or rider,
the endorsement, insertion or rider must, unless it affects all amounts payable
under the contract, make reference to the provisions in the policy affected by
the exception or reduction.
(4) The
exception or reduction mentioned in section 683 need not be set out in the
policy.
(5) This section does not apply to a contract made
by a fraternal society.
1999 cI‑5.1 s670
Statutory conditions
671 Subject to section 672, the conditions set out
in this section are deemed to be part of every contract other than a contract
of group insurance, and must be printed on or attached to the policy forming
part of the contract under the heading “Statutory Conditions�.
Statutory Conditions
THE CONTRACT 1(1) The
application, this policy, any document attached to this policy when issued, and
any amendment to the contract agreed on in writing after the policy is issued,
constitute the entire contract, and no agent has authority to change the contract
or waive any of its provisions.
WAIVER (2) The
insurer shall be deemed not to have waived any condition of this contract,
either in whole or in part, unless the waiver is clearly expressed in writing
signed by the insurer.
COPY OF
APPLICATION (3) The insurer shall, on
request, furnish to the insured or to a claimant under the contract a copy of
the application.
MATERIAL
FACTS 2 No statement made by the
insured or person insured at the time of application for the contract shall be
used in defence of a claim under or to avoid this contract unless it is
contained in the application or any other written statements or answers
furnished as evidence of insurability.
CHANGES IN
OCCUPATION 3(1) If after the contract
is issued the person insured engages for compensation in an occupation that is
classified by the insurer as more hazardous than that stated in this contract,
the liability under this contract is limited to the amount that the premium
paid would have purchased for the more hazardous occupation according to the
limits, classification of risks and premium rates in use by the insurer at the
time the person insured engaged in the more hazardous occupation.
(2) If the
person insured changes his occupation from that stated in this contract to an
occupation classified by the insurer as less hazardous and the insurer is so
advised in writing, the insurer shall either
                                (a)   reduce
the premium rate, or
                                (b)   issue
a policy for the unexpired term of this contract at the lower rate of premium
applicable to the less hazardous occupation,
according to the
limits, classification of risks, and premium rates used by the insurer at the
date of receipt of advice of the change in occupation, and shall refund to the
insured the amount by which the unearned premium on this contract exceeds the
premium at the lower rate for the unexpired term.
RELATION OF EARNINGS
TO INSURANCE 4 Where the benefits
for loss of time payable hereunder, either alone or together with benefits for
loss of time under another contract, including a contract of group accident
insurance or group sickness insurance or of both and a life insurance contract
providing disability insurance, exceed the money value of the time of the
person insured, the insurer is liable only for that proportion of the benefits
for loss of time stated in this policy that the money value of the time of the
person insured bears to the aggregate of the benefits for loss of time payable
under all such contracts and the excess premium, if any, paid by the insured
shall be returned to him by the insurer.
TERMINATION BY
INSURED 5 The insured may
terminate this contract at any time by giving written notice of termination to
the insurer by registered mail to its head office or chief agency in the
province, or by delivery thereof to an authorized agent of the insurer in the
province, and the insurer shall on surrender of this policy refund the amount
of premium paid in excess of the short‑rate premium calculated to the
date of receipt of such notice according to the table in use by the insurer at
the time of termination.
TERMINATION BY
INSURER 6(1) The insurer may terminate
this contract at any time by giving written notice of termination to the
insured and by refunding concurrently with the giving of notice the amount of
premium paid in excess of the pro rata premium for the expired time.
(2) The
notice of termination may be delivered to the insured, or it may be sent by
registered mail to the latest address of the insured on the records of the
insurer.
(3) Where
the notice of termination is delivered to the insured, 5 days’ notice of
termination shall be given; where it is mailed to the insured, 10 days’ notice
of termination shall be given, and the 10 days shall begin on the day following
the date of mailing of notice.
NOTICE AND PROOF OF
CLAIM 7(1) The insured or a person
insured, or a beneficiary entitled to make a claim, or the agent of any of
them, shall
                                (a)   give
written notice of claim to the insurer
                                          (i)   by delivery thereof, or by sending it by registered mail to the
head office or chief agency of the insurer in the province, or
                                         (ii)   by delivery thereof to an authorized agent of the insurer in the
province,
                                         not later than 30 days from
the date a claim arises under the contract on account of an accident, sickness
or disability,
                                (b)   within
90 days from the date a claim arises under the contract on account of an
accident, sickness or disability, furnish to the insurer such proof as is
reasonably possible in the circumstances of the happening of the accident or
the commencement of the sickness or disability, and the loss occasioned
thereby, the right of the claimant to receive payment, his age and the age of
the beneficiary if relevant, and
                                (c)   if
so required by the insurer, furnish a satisfactory certificate as to the cause
or nature of the accident, sickness or disability for which claim may be made
under the contract and as to the duration of such disability.
FAILURE TO GIVE NOTICE
OR PROOF (2) Failure to give notice of
claim or furnish proof of claim within the time prescribed by this Statutory
Condition does not invalidate the claim if the notice or proof is given or
furnished as soon as reasonably possible, and in no event later than one year
from the date of the accident or the date a claim arises under the contract on
account of sickness or disability if it is shown that it was not reasonably
possible to give notice or furnish proof within the time so prescribed.
INSURER TO FURNISH
FORMS FOR PROOF OF CLAIM 8 The
insurer shall furnish forms for proof of claim within 15 days after receiving
notice of claim, but where the claimant has not received the forms within that
time he may submit his proof of claim in the form of a written statement of the
cause or nature of the accident, sickness or disability giving rise to the
claim and of the extent of the loss.
RIGHTS OF
EXAMINATION 9 As a condition
precedent to recovery of insurance money under this contract,
                                (a)   the
claimant shall afford to the insurer an opportunity to examine the person of
the person insured when and so often as it reasonably requires while the claim
hereunder is pending, and
                                (b)   in
the case of death of the person insured, the insurer may require an autopsy
subject to any law of the applicable jurisdiction relating to autopsies.
WHEN MONEY PAYABLE
OTHER THAN FOR LOSS OF
TIME 10 All money payable under
this contract, other than benefits for loss of time, shall be paid by the
insurer within 60 days after it has received proof of claim.
WHEN LOSS OF TIME BENEFITS
PAYABLE 11 The initial benefits
for loss of time shall be paid by the insurer within 30 days after it has
received proof of claim, and payment shall be made thereafter in accordance
with the terms of the contract but not less frequently than once in each
succeeding 60 days while the insurer remains liable for the payments if the
person insured when required to do so furnishes before payment proof of
continuing disability.
LIMITATION OF
ACTIONS 12 An action or
proceeding against the insurer for the recovery of a claim under this contract
shall not be commenced more than one year after the date the insurance money
became payable or would have become payable if it had been a valid claim.
1999 cI‑5.1 s671
Omission or variation of
conditions
672(1) When a statutory condition is not applicable to
the benefits provided by the contract it may be omitted from the policy or
varied so that it will be applicable.
(2) Statutory
Conditions 3, 4 and 9 may be omitted from the policy if the contract does not
contain any provisions respecting the matters dealt with in those Statutory
Conditions.
(3) Statutory
Conditions 5 and 6 must be omitted from the policy if the contract does not
provide that it may be terminated by the insurer prior to the expiry of any
period for which a premium has been accepted.
(4) Statutory
Conditions 3, 4, 5, 6 and 9, and subject to the restriction in subsection (5),
Statutory Condition 7, may be varied, but if by reason of the variation the
contract is less favourable to the insured, a person insured or a beneficiary
than it would be if the condition had not been varied, the condition is deemed
to be included in the policy in the form in which it appears in section 671.
(5) Statutory
Condition 7(1)(a) and (b) must not be varied in policies providing benefits for
loss of time.
(6) Statutory
Conditions 10 and 11 may be varied by shortening the time periods in those
Statutory Conditions, and Statutory Condition 12 may be varied by lengthening
the time period in that Statutory Condition.
(7) The
title of a statutory condition must be reproduced in the policy along with the
statutory condition, but the number of a statutory condition may be omitted.
(8) In
the case of a contract made by a fraternal society,
                                (a)   the
following provision must be printed on every policy in substitution for
Statutory Condition 1(1):
                                         THE
CONTRACT 1(1) This policy, the Act or instrument of
incorporation of the society, its constitution, by‑laws and rules, and
the amendments made from time to time to any of them, the application for the
contract and the medical statement of the applicant, constitute the entire
contract, and no agent has authority to change the contract or waive any of its
provisions.
                                    and
                                (b)   Statutory Condition 5 must not be printed on
the policy.
RSA 2000 cI‑3
s672;2003 c19 s36
Notice of statutory
conditions
673 In the case of a policy of accident insurance of
a non‑renewable type issued for a term of 6 months or less or in relation
to a ticket of travel, the statutory conditions need not be printed on or
attached to the policy if the policy contains the following notice printed in
conspicuous type:
                                         Notwithstanding
any other provision herein contained, this contract is subject to the statutory
conditions in the Insurance Act respecting
contracts of accident insurance.
1999 cI‑5.1 s673
Termination for
non-payment
674(1) When a policy evidencing a contract or a
certificate evidencing the renewal of a contract is delivered to the insured
and the initial premium, or in the case of a renewal certificate, the renewal
premium for the contract has not been fully paid,
                                (a)   the
contract or the renewal evidenced by the certificate is as binding on the
insurer as if the premium had been paid although delivered by an officer or an
agent of the insurer who did not have authority to deliver it, and
                                (b)   the
contract may be terminated for the non‑payment of the premium by the
insurer on 10 days’ notice of termination given in writing to the insured and
mailed postage prepaid and registered to the latest address of the insured on
the records of the insurer, and the 10 days begin on the day following the date
of mailing the notice.
(2) This section does not apply to a contract of
group insurance or to a contract made by a fraternal society.
1999 cI‑5.1 s674
Unpaid premiums
675(1) An insurer may
                                (a)   deduct
unpaid premiums from an amount that it is liable to pay under a contract, or
                                (b)   sue
the insured for unpaid premiums.
(2) When
a cheque or other bill of exchange or a promissory note or other written
promise to pay is given for the whole or part of a premium and payment is not
made according to its tenor, the premium or part of the premium is deemed never
to have been paid.
(3) Subsection
(1)(a) does not apply to a contract of group insurance.
(4) This section does not apply to a contract made
by a fraternal society.
1999 cI‑5.1 s675
Insurable interest
676 Without restricting the meaning of the
expression “insurable interest�, a person (the “primary person�) has an
insurable interest in the primary person’s own life and well‑being and in
the life and well‑being of
                                (a)   the
primary person’s child or grandchild,
                                (b)   the
primary person’s spouse or adult interdependent partner,
                                (c)   any
person on whom the primary person is wholly or in part dependent for, or from
whom the primary person is receiving, support or education,
                                (d)   the
primary person’s officer or employee, and
                                (e)   any person in whom the primary person has a
pecuniary interest.
RSA 2000 cI‑3
s676;2002 cA‑4.5 s45
Lack of insurable interest
677(1) Subject to subsection (2), if at the time a
contract would otherwise take effect the insured has no insurable interest, the
contract is void.
(2) A
contract is not void for lack of insurable interest
                                (a)   if
it is a contract of group insurance, or
                                (b)   if
the person insured has consented in writing to the insurance.
(3) When the person insured is under the age of 16
years, consent to the insurance may be given by one of the parents of the
person insured or by someone standing in loco parentis to the person insured.
1999 cI‑5.1 s677
Policies on Lives of
Minors
Capacity of minor
678 Except in respect of the minor’s rights as
beneficiary, a minor who has attained the age of 16 years has the capacity of
an adult
                                (a)   to
make an enforceable contract, and
                                (b)   in respect of a contract.
1999 cI‑5.1 s678
Misrepresentation and Non‑Disclosure
Non-disclosure
679(1) An applicant for insurance on the applicant’s
own behalf and on behalf of each person to be insured, and each person to be
insured, must disclose to the insurer in any application, on a medical
examination, if any, and in any written statements or answers furnished as
evidence of insurability, every fact within the applicant’s or person to be
insured’s knowledge that is material to the insurance and is not so disclosed
by the other.
(2) Subject
to sections 680 and 683, a failure to disclose, or a misrepresentation of, a
fact referred to in subsection (1) renders a contract voidable by the insurer.
(3) In the case of a contract of group insurance, a
failure to disclose or a misrepresentation of a fact referred to in subsection
(1) with respect to a group person insured or a person insured under the
contract does not render the contract voidable, but if evidence of insurability
is specifically requested by the insurer, the insurance in respect of such a
person is, subject to section 680, voidable by the insurer.
1999 cI‑5.1 s679
Incontestability
680(1) Subject to section 683 and except as provided
in subsection (2),
                                (a)   when
a contract, including renewals of the contract, except a contract of group
insurance, has been in effect continuously for 2 years with respect to a person
insured, a failure to disclose or a misrepresentation of a fact with respect to
that person required by section 679 to be disclosed does not, except in the
case of fraud, render the contract voidable;
                                (b)   when
a contract of group insurance, including renewals of the contract, has been in
effect continuously for 2 years with respect to a group person insured or a
person insured, a failure to disclose or a misrepresentation of a fact with
respect to that group person insured or person insured required by section 679
to be disclosed does not, except in the case of fraud, render the contract
voidable with respect to that group person insured or person insured.
(2) If a claim arises from a loss incurred or a
disability beginning before a contract, including renewals of the contract, has
been in force for 2 years with respect to the person in respect of whom the
claim is made, subsection (1) does not apply to that claim.
1999 cI‑5.1 s680
Reinstatement
681 Sections 679 and 680 apply, with all necessary
modifications, to a failure to disclose or a misrepresentation at the time of
reinstatement of a contract and the period of 2 years to which reference is
made in section 680 commences to run in respect of a reinstatement from the
date of reinstatement.
1999 cI‑5.1 s681
Pre‑existing
conditions
682 When a contract contains a general exception or
reduction with respect to pre‑existing disease or physical conditions and
the person insured or group person insured suffers or has suffered from a
disease or physical condition that existed before the date the contract came
into force with respect to that person and the disease or physical condition is
not excluded by name or specific description from the insurance respecting that
person,
                                (a)   the
prior existence of the disease or physical condition is not, except in the case
of fraud, available as a defence against liability in whole or in part for a
loss incurred or a disability beginning after the contract, including renewals
of the contract, has been in force continuously for 2 years immediately prior
to the date of loss incurred or commencement of disability with respect to that
person, and
                                (b)   the existence of the disease or physical
condition is not, except in the case of fraud, available as a defence against
liability in whole or in part if the disease or physical condition was
disclosed in the application for the contract.
1999 cI‑5.1 s682
Misstatement of age
683(1) Subject to subsections (2) and (3), if the age
of the person insured has been misstated to the insurer then, at the option of
the insurer, either
                                (a)   the
benefits payable under the contract must be increased or decreased to the
amount that would have been provided for the same premium at the correct age,
or
                                (b)   the
premium may be adjusted in accordance with the correct age as of the date the
person insured became insured.
(2) In
the case of a contract of group insurance, if there is a misstatement to the
insurer of the age of a group person insured or person insured, the provisions,
if any, of the contract with respect to age or misstatement of age apply.
(3) When the age of a person affects the
commencement or termination of the insurance, the correct age governs.
1999 cI‑5.1 s683
Beneficiaries
Designation of
beneficiary
684(1) Unless otherwise provided in the policy, an
insured may in a contract or by a declaration designate the insured’s personal
representative or a beneficiary to receive insurance money payable in the event
of death by accident and may from time to time alter or revoke the designation
by declaration.
(2) A
designation in an instrument purporting to be a will is not ineffective by
reason only of the fact that the instrument is invalid as a will or that the
designation is invalid as a bequest under the will.
(3) A
designation in a will is of no effect against a designation made later than the
making of the will.
(4) If
a designation is contained in a will and the will is subsequently revoked by
operation of law or otherwise, the designation is revoked.
(5) If a designation is contained in an instrument
that purports to be a will and the instrument, if it had been valid as a will,
would have been subsequently revoked by operation of law or otherwise, the
designation is revoked.
1999 cI‑5.1 s684
Designation of “heirs�,
etc.
685(1) A designation in favour of the “heirs�, “next
of kin� or “estate�, or the use of words of similar meaning in a designation is
deemed to be a designation of the personal representative.
(2) If
a beneficiary predeceases the person insured or group person insured, as the
case may be, and no disposition of the share of the deceased beneficiary in the
insurance money is provided for in the contract or by declaration, the share is
payable
                                (a)   to
the surviving beneficiary,
                                (b)   if
there is more than one surviving beneficiary, to the surviving beneficiaries in
equal shares, or
                                (c)   if
there is no surviving beneficiary, to the insured or group person insured, as
the case may be, or the personal representative of the insured or group person
insured.
(3) A beneficiary designated under section 684 may
on the death by accident of the person insured or group person insured enforce
for the beneficiary’s own benefit, and a trustee appointed pursuant to section
686 may enforce as trustee, the payment of insurance money payable to the
beneficiary or trustee, and the payment to the beneficiary or trustee
discharges the insurer to the extent of the amount paid, but the insurer may
set up any defence that it could have set up against the insured or the
insured’s personal representative.
1999 cI‑5.1 s685
Trustee for beneficiary
686 An insured may in a contract or by a declaration
appoint a trustee for a beneficiary and may alter or revoke the appointment by
a declaration.
1999 cI‑5.1 s686
Payment of insurance
money
687(1) Until an insurer receives at its head or
principal office in Canada an instrument or an order of a court affecting the right
to receive insurance money, or a notarial copy or a copy verified by statutory
declaration of any such instrument or order, it may make payment of the
insurance money and is as fully discharged to the extent of the amount paid as
if there were no such instrument or order.
(2) Subsection
(1) does not affect the rights or interests of any person other than the
insurer.
(3) When
an assignee of a contract gives notice in writing of the assignment to the
insurer at its head or principal office in Canada, the assignee has priority of
interest as against
                                (a)   any
assignee other than one who gave notice earlier in like manner, and
                                (b)   a
beneficiary.
(4) When
a contract is assigned unconditionally and otherwise than as security, the
assignee has all the rights and interests given to the insured by the contract
and by this Subpart, and the assignee is deemed to be the insured.
(5) A provision in a contract to the effect that
the rights or interests of the insured, or, in the case of a contract of group
insurance, the group person insured are not assignable is valid.
1999 cI‑5.1 s687
Insurance money not part
of estate
688(1) When a beneficiary is designated, any insurance
money payable to the beneficiary is not, from the time of the happening of the
event on which it becomes payable, part of the estate of the insured and is not
subject to the claims of the creditors of the insured.
(2) While there is in effect a designation of
beneficiary in favour of any one or more of a spouse or adult interdependent
partner, child, grandchild or parent of the person insured or group person
insured, the rights and interests of the insured in the insurance money and in
the contract so far as either relate to accidental death benefits are exempt
from writ proceedings.
RSA 2000 cI‑3
s688;2002 cA‑4.5 s45
Enforcement of contract
689 A group person insured may, in the group person
insured’s own name, enforce a right given by a contract to the group person
insured or to a person insured under the contract as a person dependent on or
related to the group person insured, subject to any defence available to the
insurer against any of them.
1999 cI‑5.1 s689
Simultaneous deaths
690 Unless a contract or a declaration otherwise
provides, if a person insured or group person insured and a beneficiary die at
the same time or in circumstances rendering it uncertain which of them survived
the other, the insurance money is payable in accordance with section 685(2) as
if the beneficiary had predeceased the person insured or group person insured.
1999 cI‑5.1 s690
Payment into Court
691(1) When the insurer admits liability for the
insurance money, or any part of the insurance money, and it appears to the
insurer that
                                (a)   there
are adverse claimants,
                                (b)   the
whereabouts of the person entitled are unknown, or
                                (c)   there
is no person capable of giving or authorized to give a valid discharge for the
insurance money who is willing to do so,
the insurer may apply
ex parte to the Court for an order for payment of the money into Court, and the
Court may on the notice, if any, it considers necessary, make an order
accordingly.
(2) The
Court may fix without taxation the costs incurred on or in connection with any
application or order made under subsection (1) and may order the costs to be
paid out of the insurance money or by the insurer or otherwise as it considers
just.
(3) A payment made pursuant to an order under
subsection (1) discharges the insurer to the extent of the payment.
1999 cI‑5.1 s691
Insurance money payable
to minor
692(1) When an insurer admits liability for insurance
money payable to a minor and there is no person capable of giving and
authorized to give a valid discharge for the insurance money who is willing to
do so, the insurer may, at any time after 30 days from the date of the
happening of the event on which the insurance money becomes payable, pay the
money less the applicable costs mentioned in subsection (2) into Court to the
credit of the minor.
(2) The
insurer may retain out of the insurance money for costs incurred on payment
into Court under subsection (1) the sum of $10 when the amount does not exceed
$1000, and the sum of $15 in other cases, and payment of the remainder of the
money into Court discharges the insurer.
(3) No order is necessary for payment into Court under
subsection (1), but the accountant or other proper officer must receive the
money on the insurer’s filing with the accountant or proper officer an
affidavit showing the amount payable and the name, date of birth and residence
of the minor, and on the payment’s being made the insurer must forthwith notify
the Public Trustee and deliver a copy of the affidavit to the Public Trustee.
1999 cI‑5.1 s692
Beneficiary under
disability
693 When it appears that a representative of a
beneficiary who is under disability may accept payments on behalf of the
beneficiary under the law of the domicile of the beneficiary, the insurer may
make payment to the representative, and the payment discharges the insurer to
the extent of the amount paid.
1999 cI‑5.1 s693
Payments not exceeding
$2000
694 Even though insurance money is payable to a
person, the insurer may if the contract so provides, but subject always to the
rights of an assignee, pay an amount not exceeding $2000 to
                                (a)   a
relative of a person insured or the group person insured, or
                                (b)   any
person appearing to the insurer to be equitably entitled to the insurance money
by reason of having incurred expense for the maintenance, medical attendance or
burial of a person insured or the group person insured, or to have a claim
against the estate of a person insured or the group person insured in relation
to those expenses,
and the payment discharges the insurer to the extent of the
amount paid.
RSA 2000 cI‑3
s694;2002 cA‑4.5 s45
Payment of insurance
money
695(1) Subject to subsection (2), insurance money is
payable in Alberta.
(2) In
the case of a contract of group insurance, insurance money is payable in the
province or territory in which the group person insured was resident at the
time the group person insured became insured.
(3) Unless
a contract otherwise provides, a reference in the contract to dollars means
Canadian dollars whether the contract by its terms provides for payment in
Canada or elsewhere.
(4) When
a person (the “primary person�) entitled to receive insurance money is not
domiciled in Alberta, the insurer may pay the insurance money to the primary
person or to any person who is entitled to receive it on behalf of the primary
person under the law of the domicile of the payee, and the payment discharges
the insurer to the extent of the amount paid.
(5) When insurance money is by the contract payable
to a person who has died or to the person’s personal representative and the
deceased person was not at the date of death domiciled in Alberta, the insurer
may pay the insurance money to the personal representative of that person
appointed under the law of the person’s domicile, and the payment discharges
the insurer to the extent of the amount paid.
1999 cI‑5.1 s695
Action for payment
696 Regardless of where a contract was made, a
claimant who is resident in Alberta may bring an action in Alberta if the
insurer was authorized to transact insurance in Alberta at the time the
contract was made or at the time the action is brought.
1999 cI‑5.1 s696
Insurer giving
information
697 An insurer does not incur any liability for any
default, error or omission in giving or withholding information as to any
notice or instrument that it has received that affects the insurance money.
1999 cI‑5.1 s697
Undue prominence
698 The insurer must not in the policy give undue
prominence to any provision or statutory condition as compared to other
provisions or statutory conditions, unless the effect of that provision or
statutory condition is to increase the premium or decrease the benefits
otherwise provided for in the policy.
1999 cI‑5.1 s698
Relief from forfeiture
699 If there has been imperfect compliance with a
statutory condition as to any matter or thing done or omitted to be done by the
insured, person insured or claimant with respect to the loss insured against
and a consequent forfeiture or avoidance of the insurance in whole or in part,
and a court before which a question relating to the imperfect compliance is
tried considers it inequitable that the insurance should be forfeited or
avoided on that ground, the court may relieve against the forfeiture or
avoidance on any terms it considers just.
1999 cI‑5.1 s699
Disability benefits
700 If a policy issued after January 1, 1974
includes provision for disability benefits to be payable only during
confinement of the insured, the provision does not bind the insured and the
benefits in respect of disability under the policy during the disability are
payable regardless of whether the insured is confined or not.
1999 cI‑5.1 s700
Presumption against
agency
701 No officer, agent, employee or servant of the
insurer and no person soliciting insurance, whether or not the person is an
agent of the insurer, is, to the prejudice of the insured, person insured or
group person insured, deemed to be the agent of the insured or of the person
insured or group person insured in respect of any question arising out of the
contract.
1999 cI‑5.1 s701
Subpart 7
Livestock Insurance
Application of Subpart
702 This Subpart applies to livestock insurance and
to any insurer carrying on the business of livestock insurance in Alberta.
1999 cI‑5.1 s702
Scope of insurance
703(1) Every insurer licensed under this Act for the
transaction of livestock insurance may, within the limits and subject to the
conditions to which the licence is subject, insure against loss of livestock by
fire, lightning, accident, disease or other means, except that of design on the
part of the insured, or by the invasion by an enemy or by insurrection.
(2) An insurer licensed under this Act to transact
mutual fire insurance may, within the limits and subject to the conditions to
which the licence is subject, insure against loss of livestock by fire and
lightning only, except loss by fire caused by design on the part of the
insured, or by the invasion by an enemy or by insurrection.
1999 cI‑5.1 s703
Application of Subpart 3
to livestock insurance
704 The following provisions of Subpart 3 apply to
livestock insurance contracts:
                                (a)   the
provisions as to the form and contents of the policy;
                                (b)   the provision as to the conditions including
the statutory conditions, except where inapplicable to the nature of the risk.
1999 cI‑5.1 s704
Application of Subpart
10
705 Subpart 10 applies to all contracts of livestock
insurance issued by mutual fire insurers.
1999 cI‑5.1 s705
Term of contract
706 Contracts of insurance must not in any case
exceed the term of 3 years.
1999 cI‑5.1 s706
Renewals
707(1) A contract made for one year or any shorter
period may be renewed from time to time at the discretion of the directors by
renewal receipt instead of by policy on the insured’s paying the required
premium or giving a premium note.
(2) All payments or renewal by cash or premium
notes must be made at or before the end of the period for which the policy was
granted or renewed, otherwise the policy is void.
1999 cI‑5.1 s707
Form of mutual contracts
708 A contract of livestock insurance issued under
this Subpart by a mutual fire insurer may be issued as a separate policy or may
form part of the insured’s fire insurance policy, subject to the provisions of
this Subpart.
1999 cI‑5.1 s708
Notice of claim
709(1) A person claiming under a contract of livestock
insurance must furnish notice of the claim to the insurer within 10 days after
loss.
(2) Failure to give the notice within the time
specified does not invalidate the claim if it is shown that it was not
reasonably possible to give the notice within that time and that notice was
given as soon as was reasonably possible.
1999 cI‑5.1 s709
Subpart 8
Hail Insurance
Application of Subpart
710(1) This Subpart applies to hail insurance and to
every insurer carrying on the business of hail insurance in Alberta except the
Agriculture Financial Services Corporation.
(2) For the purposes of this Subpart, “premium� as
defined in section 1 includes a negotiable instrument accepted by the insurer
or its general agent as payment of the premium.
1999 cI‑5.1 s710
Property insurable
711(1) Every insurer may, within the limits and
subject to the restrictions set out in its licence, insure or reinsure
                                (a)   crops
of wheat, oats, barley, flax, rye or speltz, field peas, buckwheat, grasses or
clover grown for seed, field corn or sunflower grown for seed or fodder, or
                                (b)   field
or garden or horticultural crops other than those specified in clause (a).
(2) In
the case of the crops mentioned in subsection (1)(b), the Superintendent may
approve a form of contract appropriate to insure those crops, and in that event
the statutory conditions must be read with those modifications necessary to
give effect to the terms and conditions of a contract in the form so approved.
(3) The
insurer may by an endorsement on the policy, and in consideration of an
additional premium, insure the crop
                                (a)   for
any period during which it is lying in windrows, or
                                (b)   for
any period during which it is in sheaves either on the ground or in stooks.
(4) The insurer may by an endorsement on the
policy, and in consideration of a additional premium, insure the crop against
loss or damage incidental to crops arising from other causes, and in that case
the statutory conditions must be read with those modifications necessary to
give effect to the terms and conditions of the endorsement.
1999 cI‑5.1 s711
Insurable interest
712(1) The contract is void if, at the time at which
it would otherwise take effect, the insured has not an insurable interest in
the crop insured.
(2) If the insured has an insurable interest in the
crop insured when the contract takes effect, it is not necessary for the
validity of the contract that any person to whom the insurance money is
payable, whether by the terms of the contract or by assignment, have an
insurable interest in the crop.
1999 cI‑5.1 s712
Application for contract
713(1) No insurer may effect a contract of insurance
unless the insurer has been tendered an application for the contract in writing
signed by the applicant or the applicant’s agent.
(2) A
copy of the application or of that part of the application that is material to
the contract must be embodied in, endorsed on or attached to the policy when
issued by the insurer, and forms part of the contract.
(3) The
application must set out
                                (a)   the
name and address of the applicant;
                                (b)   an
itemized description of the location and area of each part of the crop to be
insured and the amount of insurance applied for on each hectare;
                                (c)   whether
the crop has been hailed prior to the time of the application;
                                (d)   the
insurable interest of the applicant;
                                (e)   the
name of the person or persons to whom the insurance money is payable;
                                 (f)   with the approval of the Superintendent, any
further information the insurer requires.
1999 cI‑5.1 s713
Information to appear on
face of policy
714(1) On the face of every policy there must appear
                                (a)   the
name of the insurer;
                                (b)   the
name of the insured;
                                (c)   the
name of the person or persons to whom the insurance money is payable;
                                (d)   the
premium or other consideration for the insurance;
                                (e)   the
subject‑matter of the insurance;
                                 (f)   the
maximum amount or amounts that the insurer contracts to pay;
                                (g)   the
date of the commencement of liability;
                                (h)   the
event on the happening of which payment is to be made;
                                 (i)   the
term of the contract.
(2) There must appear on every application and on
every policy in a prominent position and in prominent type the name and address
of the insurer’s head or branch office or general agency from which the policy
is to be or is issued.
1999 cI‑5.1 s714
Delivery of application
to insurer
715 Every insurance agent who takes an application
on behalf of an insurer must deliver it to the insurer, or forward it to the
insurer by mail, not later than the day following the day on which it is taken.
1999 cI‑5.1 s715
Effective date of
contract
716(1) If an insurance agent of an insurer mails an
application for insurance on crops mentioned in section 711(1)(a) to the head
or branch office or the general agency of the insurer in Alberta and tenders
with the application payment of the premium in cash, or by post office order,
postal note, express order, bank money order, certificate of deposit of a bank
or certified cheque, a contract of insurance in accordance with the application
takes effect at 12 noon of the day following the date of the mailing, and in
that case, the post office date stamp determines the date of mailing.
(2) The
insurer may decline the application on its receipt, and if the application is
declined the insurer must forthwith give notice of that decision by registered
letter, or by prepaid telegram if possible, to the applicant at the applicant’s
address as given in the application and to the insurance agent tendering the
application, in which case the contract of insurance mentioned in subsection
(1) continues in force only until 12 noon of the day following the receipt of the
notice by the applicant.
(3) Despite
subsection (2), notice in writing that the application has been declined may be
personally delivered to the applicant by the insurance agent, and in that event
the contract of insurance mentioned in subsection (1) continues in force only
until 12 noon of the day following receipt of the notice by the applicant.
(4) The
premium tendered with the application must be returned to the applicant or held
by the insurer for the applicant for premium purposes solely and is payable on
the direction of the applicant to any insurer to whom an application for
insurance is subsequently tendered.
(5) If the applicant subsequently tenders an
application for insurance to another insurer and endorses on the application a
notice that the premium is held as mentioned in subsection (4), the amount so
held is, for the purpose of this section, deemed to have been tendered with the
application.
1999 cI‑5.1 s716
Reduction or increase in
amount of premium
717 If the amount of premium tendered with an
application made in accordance with section 716 is not the correct amount, the
insurance must, unless readjusted before loss occurs, be either reduced or
increased to the amount the premium actually tendered would pay for, according
to the correct rate of premium applicable to the risk.
1999 cI‑5.1 s717
Consideration of
applications
718(1) If an agent of an insurer tenders an
application with payment of the premium otherwise than as specified in section
716, or if the applicant tenders the application and payment of the premium, to
the head or branch office or the general agency of the insurer in Alberta, the
application must immediately be stamped with the date of its receipt.
(2) Subject
to subsection (3), the application must be accepted or declined not later than
the day following the date of its receipt and must be so stamped.
(3) When the applicant tenders with the application
an order on a third party as payment of the premium, the application must be
accepted or declined on the day following the date of receipt from the third
party of notice of acceptance or of refusal to accept the order for payment.
1999 cI‑5.1 s718
Notice to applicant
719(1) If the application is accepted, the insurance
applied for takes effect at 12 noon of the day on which the application is
accepted.
(2) If
the application is declined, the applicant must be notified on the day on which
the application is declined, at the address as given in the application.
(3) If
there is a telegraph office at the address of the applicant, the notice
declining the application must be given by prepaid telegram, otherwise it must
be forwarded in writing by registered letter.
(4) If the insurer does not notify the applicant
that the application has been declined, the insurer is conclusively presumed to
have accepted the application.
1999 cI‑5.1 s719
Policy in accordance
with application
720 A policy issued to an insured on an application
in writing is deemed to be in accordance with the application unless the
insurer forthwith gives notice to the insured in writing of the particulars in
which the policy and application differ.
1999 cI‑5.1 s720
Expiration of hail
insurance policies
721(1) Subject to subsection (2), all policies of hail
insurance expire at 12 noon on September 15 in the year in which they are made.
(2) If
any portion of the insured crop is cut before that date then, subject to
section 711(3), the liability of the insurer ceases in respect of that portion
when it is cut, and the insurance on each hectare of the remaining area
continues until the crop on the remaining area is cut but not beyond that date
unless extended pursuant to subsection (3).
(3) The insurer may, by an endorsement on the
policy, in consideration of an additional premium, extend the term of the contract
beyond the date specified in this section.
1999 cI‑5.1 s721
Partial payment of loss
clause
722(1) A policy may contain a partial payment of loss
clause to the effect that the insurer must pay only an agreed proportion of any
loss that is sustained or the amount of the loss after deduction of a sum
specified in the policy, in either case not exceeding the amount of the
insurance, in which case there must be printed or stamped on the face of the
policy in conspicuous type in red ink or bold type, the words: “This policy
contains a partial payment of loss clause�.
(2) The partial payment of loss clause is not, for
the purposes of this Act, a variation of or an addition to the statutory
conditions.
1999 cI‑5.1 s722
Rates of premium
723(1) Every insurer must, before May 1 in each year,
file with the Superintendent the rates of premium to be charged in designated
areas in Alberta, and those rates are effective during the current calendar
year unless in the meantime the rates are changed and the Superintendent is
notified of the change at least 10 days before the change becomes effective.
(2) When a rate has been reduced after
notification, the new rate is applicable to all contracts issued by the insurer
within the designated areas, and the insurer must return to each insured within
the designated areas the amount by which the premium paid by each insured
exceeds the premium at the lower rate.
1999 cI‑5.1 s723
Rate of commission
724(1) Every insurer must, before May 1 in each year,
file with the Superintendent the rate of commission payable to its insurance
agents in respect of its contracts issued during the current year.
(2) No
insurer may, directly or indirectly, pay or allow or offer or agree to pay or
allow any compensation or anything of value to any person for acting or
attempting or assuming to act as its insurance agent in excess of that offered,
paid or allowed to any one of its insurance agents on risks for which similar
rates of premium are payable.
(3) If on investigation by the Superintendent an
insurer is found to have contravened subsection (2), the same rate of
commission must be paid to all insurance agents on risks for which similar
rates of premium are charged.
1999 cI‑5.1 s724
Notice of cancellation
or alteration
725 When a loss has, with the consent of the
insurer, been made payable to some person other than the insured, the contract
must not be cancelled or altered to the prejudice of that person without
reasonable notice to that person by the insurer.
1999 cI‑5.1 s725
Adjustment of loss
726 When an adjustment of loss under a contract has
been made, a copy of the adjustment, signed by the adjuster and the insured or
the insured’s agent, must be given to the insured or the insured’s agent.
1999 cI‑5.1 s726
Refund of premium
727(1) If the actual area of the crop insured under
any item of a policy is found to be less than the area mentioned in the
application under that item, the insurer must repay to the insured the premium
paid on the excess area.
(2) If the actual area of the crop insured under
any item of a policy is found to be greater than the area mentioned in the
application, the amount of insurance on each hectare is reduced on a prorated
basis in its relation to the actual area, unless the area insured is clearly identified
in the application or by a diagram on the application.
1999 cI‑5.1 s727
Statutory conditions
728 The conditions set out in this section
                                (a)   are
deemed to be part of every contract in force in Alberta, and
                                (b)   must
be printed on every policy under the heading “Statutory Conditions�,
and no stipulations to
the contrary, or provisions for a variation, addition or omission, are binding
on the insured, nor is anything contained in the description of subject‑matter
of the insurance effective insofar as it is inconsistent with, varies, modifies
or avoids any such condition.
Statutory Conditions
MISDESCRIPTION OR
MISREPRESENTATION 1 Where an
applicant in his application falsely describes the location and area of the
crop, to the prejudice of the insurer, or knowingly misrepresents or fails to
disclose in the application any fact required to be stated therein, the
insurance shall be void as to the item of the application in respect of which
the misdescription, misrepresentation or omission is made.
WAIVER OF
CONDITIONS 2 No term or condition
of the policy shall be deemed to have been waived by the insurer, either in
whole or in part, unless the waiver is clearly expressed in writing signed by
or on behalf of the insurer at its head or branch office or general agency from
which the policy was issued.
OFFICER PRESUMED AN
AGENT 3 Any officer or general
agent of the insurer who assumes on behalf of the insurer to enter into a
written agreement relating to any matter connected with the insurance shall be
deemed, prima facie, to be the agent of the insurer for the purpose.
4 No
claimant shall be entitled to indemnity under the policy for any loss or damage
which is found to be less than 5% of the crop on the hailed area or any portion
thereof and in no case for less than $10, except where the area insured is 16
hectares or less.
CONDITIONS OF
INDEMNITY 5 No claimant shall be
entitled to indemnity under the policy
                                (a)   when
the crop is wholly destroyed by any agency other than hail,
                                (b)   when
the crop is over‑ripe, or
                                (c)   when
the crop or any portion thereof has been so injured by causes other than hail
that the crop or such portion, as the case may be, would not yield profit over
and above the actual cost of cutting, threshing and marketing it.
NOTICE OF CLAIM OF
LOSS 6 Any person claiming under
the policy shall give notice of claim in writing to the head or branch office
or the general agency of the insurer from which the policy was issued within 3
days of the occurrence of loss, stating the number of the policy, the day and
hour of the storm, the estimated damage to each portion of the insured crop and
the names of other insurers carrying insurance on the hailed area, provided
that failure to give notice within such time shall, subject to condition 9, not
invalidate the claim if it is shown that it was not reasonably possible to give
notice within that time and that notice was given as soon as was reasonably
possible.
RIGHT OF ACCESS OF
INSURER 7 After any loss or
damage to the insured crop, the insurer shall have immediate right of access
and entry by accredited representatives sufficient to enable them to survey and
examine the crop and to make an estimate of the loss or damage.
INSURER AND INSURED TO
ASCERTAIN PERCENTAGE 8 Within 30
days after the receipt of notice of loss or damage the insurer and the insured
or their accredited representatives shall together ascertain and agree on the
percentage of loss or damage sustained on the area of the crop or any portion
thereof insured under any item of the policy. The amount of indemnity shall be
ascertained on the agreed percentage of the insurance on each hectare of the
area sustaining loss or damage by hail, subject to any partial payment of loss
clause contained in the policy or subject to the determination of the amount of
the loss or damage by appraisal as hereinafter provided. No account shall be
taken of the cost of cutting or threshing the portion not destroyed or damaged.
The determination of the percentage of loss or damage may be deferred to a
later date agreed on by the insurer and the insured.
PROOF OF LOSS
MADE 9 A person making a claim
under the policy shall, within 30 days after the occurrence of a loss or within
30 days of the deferred adjustment date, unless such time is extended in
writing by the insurer, furnish a statutory declaration, hereinafter called
proof of loss, on a form furnished by the insurer, setting forth the date and
number of the policy, the date of the occurrence of the loss or damage, the
location and area of the crop damaged, the estimated percentage of loss or
damage sustained on the area of the crop or any portion thereof insured under
any item of the policy and whether the crop was damaged by hail prior to the
time of the application. If the claimant fails to furnish proof of loss he
shall forfeit any claim under the policy.
PROOF OF LOSS MAY BE
WAIVED Provided that if the insurer, within the
said 30 days or at the time of the deferred adjustment, has ascertained the
loss acceptable to the claimant or if the amount of loss has been determined by
appraisal as hereinafter provided, the insurer shall be deemed to have waived
proof of loss, unless proof of loss is requested by the insurer in writing.
PROOF OF LOSS MAY BE
MADE BY AGENT OF INSURED 10 Proof
of loss must be made by the insured, although the loss is payable to a third
person, except that, in case of the absence of the insured or his inability to
make the same, proof may be made by his agent, such absence or inability being
satisfactorily accounted for, or in the like case if the insured refuses to do
so, by a person to whom any part of the insurance money is payable.
FRAUD OR FALSE
STATEMENT 11 Any fraud or
wilfully false statement in a proof of loss shall vitiate the claim of the
person making such proof of loss.
PAYMENT OF MONEY
WITHIN PERIOD 12 The insurer
shall pay the insurance money for which it is liable under the policy within 60
days after the proof of loss has been received by it or where an appraisal is
had under condition 15, within 30 days after the award is rendered by the
appraisers.
INSURED LIABLE FOR
EXPENSES INCURRED 13 If the
insured claims for loss or damage under the policy and it is found that he is
not entitled to indemnity under the conditions of the policy, the insured shall
be liable for the expenses incurred in the adjustment of his claim.
CANCELLATION OF
POLICY 14 A policy may be
cancelled at any time by the insured named therein by giving written notice to
that effect to the head or branch office or the general agency of the insurer
from which the policy was issued and the insurer shall, on surrender of the
policy, refund the excess of paid premium above the customary short rate
premium for the time the policy has been in force. If a note or other
undertaking was accepted as payment of the premium the insured shall pay the
insurer the earned portion of the premium and on payment or tender of such
amount the insurer shall return such note or undertaking to pay, or if the insured
does not pay or tender the amount, the insurer shall endorse on the note or
other undertaking a credit of the amount of the unearned portion of the
premium.
APPRAISAL IN CASE OF
DISAGREEMENT 15 In the event of a
disagreement as to the percentage of damage by hail to any of the crops
insured, whether the right to recover on the policy is disputed or not, such
percentage shall, when so required by either party, be ascertained by an
appraisal which shall be conducted as follows:
                                 (i)   the
party desiring appraisal shall within 3 days of such disagreement deliver or
cause to be delivered by mail or otherwise to the other party a notice in
writing requiring an appraisal to be made and appointing an appraiser who is a
taxpayer in the Province, who shall act either alone or with an appraiser
chosen by the other party to estimate the percentage of the damage;
                                (ii)   not
later than 3 days after receipt of such notice the other party shall, if he so
desires, appoint an appraiser to represent him and, within the said period,
shall notify the first party of such appointment by notice in writing delivered
by mail or otherwise;
                               (iii)   in
the latter case the appraisers shall together estimate the percentage of damage
and failing to agree shall submit their differences to an umpire, and the award
in writing of any 2 shall determine the percentage of the damage. Such umpire
shall be chosen by the appraisers, or in case they cannot agree, then on the
application of either appraiser, by the Superintendent of Insurance;
                               (iv)   if
only one appraiser has been chosen, both parties shall share equally his
expenses; if 2, each party shall pay the expense of the appraiser chosen by
him; both parties shall bear equally the expense of the umpire if an umpire is
required;
                                (v)   should
either party after receipt of written notice from the other, neglect or refuse
to choose an appraiser within the time above specified the percentage of damage
shall be estimated and determined by the appraiser chosen by the party giving
notice;
                               (vi)   the
actual appraisal of such damage shall be commenced within 2 days after both
appraisers have been chosen, or after the expiration of the time herein allowed
for such choice;
                              (vii)   the
periods of time specified in this condition may on application be extended at
the discretion of the Superintendent of Insurance.
ACTION BROUGHT WITHIN
ONE YEAR 16 Every action or
proceeding against the insurer in respect of loss or damage to the crops
insured under the policy shall be commenced within one year next after the
occurrence of the loss or damage and not afterwards.
ASSIGNMENT OR CHANGE OF
PROPERTY 17 If the crop insured
or the interest of the insured in such crop is assigned without the written
permission of the head or branch office or general agency of the insurer from
which the policy is issued, such assignment shall not be binding on the
insurer; but this condition does not apply to change of title by succession or
by operation of the law, or by reason of death.
1999 cI‑5.1 s728
Subpart 9
Weather Insurance
Application of Subpart
729 This Subpart applies to weather insurance and to
any insurer carrying on the business of weather insurance in Alberta, but does
not apply to weather insurance provided by an endorsement to a contract of fire
insurance.
1999 cI‑5.1 s729
Insurability
730 Every insurer licensed under this Act for the
transaction of weather insurance may, within the limits and subject to the
conditions to which the licence is subject, insure against any atmospheric
disturbances, discharges or conditions that the contract of insurance
specifies.
1999 cI‑5.1 s730
Application of fire
insurance provisions
731 The following provisions of this Act apply to
weather insurance contracts:
                                (a)   the
provisions of Subpart 3 as to the form and contents of the policy;
                                (b)   the
provisions of Subpart 3 as to conditions, including the statutory conditions,
except where inapplicable to the nature of the risk;
                                (c)   the provisions of Subpart 10 relating to
premium notes and assessments, if the insurance is on the premium note plan.
1999 cI‑5.1 s731
Additional conditions
732 The following additional conditions form part of
every weather insurance contract:
                                (a)   the
insurance may be terminated by the insurer by giving 7 days’ notice to that
effect;
                                (b)   the insurer is not liable for loss or damage
occurring to buildings or structures or to their contents where the buildings
or structures have been weakened by subsequent alterations unless permission to
make the alterations has been previously granted in writing signed by an
authorized agent of the insurer.
1999 cI‑5.1 s732
Duration of contract
733 A contract of weather insurance must not in any
case exceed the term of 3 years.
1999 cI‑5.1 s733
Fixed payments on
premium notes
734(1) On every premium note taken by the insurer
there is payable at the commencement of each year of insurance a cash payment
amounting to at least 0.2% of the sum insured or on a prorated basis when the
cash payment is paid in advance for a longer term, and the balance of the
premium note is subject to assessment by the directors.
(2) Despite subsection (1), when the amount of
insurance in force exceeds $3 000 000 and the total assets of the
insurer do not fall below 2% of the total amount at risk, reduction of the cash
payment may be made to 0.125% of the sum insured per year or on a prorated
basis for a longer term.
1999 cI‑5.1 s734
Subpart 10
Mutual Insurance
Contracts
Application of Subpart 3
735(1) The provisions of Subpart 3 apply to all mutual
fire insurance contracts.
(2) Despite anything contained in this Act,
sections 743 to 753 apply to all mutual and cash‑mutual corporations
operating in Alberta whether incorporated under the laws of Alberta or the laws
of any other province or territory, or of Canada.
1999 cI‑5.1 s735
Minimum rates
736(1) The minimum rate to be charged for insuring
ordinary frame buildings and their contents must not be less than $0.40 per
$100 of insurance per year, and the minimum rates on that and other property
must be increased or decreased relative to the increased or decreased risk
according to the nature of the property.
(2) Despite subsection (1), any company that
creates and maintains a reserve fund of at least $5000 for the first
$1 000 000 of insurance in force and an additional $2000 for each additional
$1 000 000 or part of $1 000 000 in force may charge the
rates the board of directors decides.
1999 cI‑5.1 s736
Liability when policy is
cancelled
737(1) If a policy is cancelled or voided by the
company, the liability of the insured on the insured’s premium note or
undertaking ceases from the date of the cancellation or avoidance on account of
any loss that occurs to the company after the cancellation or avoidance, but
the insured is nevertheless liable to pay the insured’s proportion of the losses
and expenses of the company to the time of cancelling or avoiding the policy.
(2) On payment of the insured’s proportion of all
assessments then payable and to become payable in respect of losses and
expenses sustained up to the cancellation or avoidance of the policy, the
insured is entitled to a return of the insured’s premium note or undertaking
and that proportion of the premium paid by the insured that has not been
absorbed by the losses and expenses of the company up to the time of the cancellation
or avoidance, and a condition to that effect must be endorsed on the policy.
1999 cI‑5.1 s737
Assignment of property
insured
738(1) If the company becomes entitled to avoid a
policy for alienation or partial alienation of the insured property or of any
interest in the insured property, then, on the return of the policy to the
company to be cancelled, unless the directors elect to continue the policy, the
insured is entitled to receive the insured’s premium note or notes on payment
of the insured’s proportion of all losses and expenses that have accrued prior
to the surrender.
(2) The
assignee may have the policy transferred to the assignee, and the assignee, on
application to the directors and on giving proper security to their
satisfaction for that proportion of the premium note or undertaking that
remains unpaid, and with the consent of the directors within 30 days after the
alienation, may have the policy ratified and confirmed to the assignee.
(3) By
the ratification and confirmation of the policy the assignee is entitled to all
the rights and privileges and is subject to all the liabilities and conditions
to which the original insured party was entitled and subject.
(4) Despite subsections (1) to (3), if the assignee
is a mortgagee, the directors may permit the policy to remain in force and to
be transferred to the assignee by way of additional security without requiring
any premium note or undertaking from the assignee or without the assignee
becoming in any manner personally liable for premiums or otherwise, but in that
case the premium note or undertaking and liability of the mortgagor in respect
of the premium note or undertaking continue and are in no way affected.
1999 cI‑5.1 s738
Premium Notes and
Assessments
Premium notes
739 The company may accept the premium note of the
insured for insurance and may undertake contracts in consideration of the
premium note, and those notes are assessable for the losses, expenses and
reserve of the company in the manner provided in this Subpart.
1999 cI‑5.1 s739
Payment on premium note
740(1) At the time the application for insurance is
made the applicant must make a first payment of not less than 10% on the
premium note or undertaking.
(2) The
first payment may be made in cash and must be remitted to the company together
with the application.
(3) The
first payment must be credited on the first assessment levied under section
746.
(4) Not more than 60% of any premium note may be
paid in cash at the time of the application or of effecting the insurance.
1999 cI‑5.1 s740
Form of premium note
741 The directors may collect a
portion of the premium in cash and take a premium note for the remainder of the
premium, and if the amount so collected is more than sufficient to pay all
losses and expenses during the continuance of the policy, the surplus becomes
part of the reserve fund.
1999 cI‑5.1 s741
Assessments on premium
notes
742 The directors may make assessments on premium
notes before losses have happened or expenses have been incurred, and any surplus
from the assessments becomes part of the reserve fund.
1999 cI‑5.1 s742
Assessment
743(1) All premium notes must be assessed by the
directors at the intervals and for the sums that they determine, and for any
further sums that they consider necessary and that are authorized by this Act,
for losses, expenses and reserve during the currency of the policies for which
the notes were given and in respect of which they are liable to assessment.
(2) Every member of the company who has given a
premium note must pay the sums from time to time payable by the member to the
company during the continuance of the member’s policy and in accordance with
the assessment.
1999 cI‑5.1 s743
Notice of assessment
744 Notice of every assessment must state the date
on which it is payable and must be mailed to each member who has given a
premium note at the member’s post office address as given in the member’s
original application or otherwise given in writing to the company.
1999 cI‑5.1 s744
Assessment notices to
mortgagee
745 If the insured property has been mortgaged by
the member and the company has assented to the mortgage, the notices of
assessments must also be mailed to the mortgagee if the mortgagee’s post office
address is known to the company.
1999 cI‑5.1 s745
Payment of assessment
746(1) If an assessment is not paid within 30 days
after the date of payment mentioned in the notice referred to in section 744,
the contract of insurance in respect of which the assessment has been made is
void as to any claim for loss occurring during the time of non‑payment,
but the contract is revived when the assessment is paid unless the secretary
gives notice to the contrary to the member assessed in the manner provided in
this Act.
(2) Nothing
in this section relieves the insured from liability to pay the assessment or
any subsequent assessments, nor is the insured entitled to recover the amount
of any loss or damage that happens to property insured under the contract while
the assessment remains due and unpaid, unless the directors determine
otherwise.
(3) A notice of assessment mailed as required by
section 744 is sufficient if it states the registered number of the contract,
the amount of the assessment and the time when and the place where it is
payable.
1999 cI‑5.1 s746
Proportioning assessment
747 The assessment must always be in proportion to
the amount of the premium notes held by the company, but when a company alters
its premium notes rate and still holds in respect of subsisting contracts
premium notes at the prior rate, the company, as between the respective premium
notes so differing in rate, may make and levy such differential assessments as
will in risks of the same amount and of the same class of hazard equalize the
cost of insurance to the makers of the respective premium notes.
1999 cI‑5.1 s747
Recovery of Assessments
Recovery of assessments
748 If for 30 days after an assessment becomes
payable a member who has given a premium note refuses or neglects to pay the
assessment, the company may sue for and recover the assessment with costs, and
the proceedings are not a waiver of any forfeiture incurred by non‑payment.
1999 cI‑5.1 s748
Proof
749 In an action to recover the assessment, the
certificate of the secretary of the company specifying the assessment and the
amount due on the note in respect of the assessment is admissible in evidence
as proof, in the absence of evidence to the contrary, of the amount due on the
note.
1999 cI‑5.1 s749
Return of premium note
750 Forty days after the expiration of the term of
insurance the premium note given for the insurance policy must on application
be given up to the grantor of the premium note if all assessments levied and
all losses and expenses with which the note is chargeable have been paid.
1999 cI‑5.1 s750
Retention of premium
note
751 If there is a loss on property insured, the
directors may retain the amount of the premium note until the time has expired
for which insurance has been made, and at the expiration of that time the
insured has the right to demand and receive that part of the retained sum that
has not been assessed for.
1999 cI‑5.1 s751
Lien
752 No premium note creates a lien on the land on
which the insured property is situated.
1999 cI‑5.1 s752
Judicial district
753(1) Any action on a premium note or for an
assessment on a premium note may be entered, tried and determined in the
judicial district in which the head office or any agency of the company is
situated.
(2) The word “action� in this section includes a
proceeding under Part 4 of the Provincial
Court Act.
1999 cI‑5.1 s753
Part 6
Enforcement and Administration
Subpart 1
Enforcement
Definition
754 In this Subpart, “regulated person� means
                                (a)   a
person who is required to be licensed under this Act,
                                (b)   a
person who has entered into a contract of insurance referred to in section 61
or 63,
                                (c)   an
insurer referred to in section 62 who reinsures contracts,
                                (d)   a
person exchanging a reciprocal contract of indemnity or inter‑insurance
referred to in section 79 or 80, or
                                (e)   a person who acts or offers to act as an
insurance agent or adjuster.
1999 cI‑5.1 s754
Division 1
Determining Compliance
and Examinations
Exercising examiner’s powers
755 An examiner may exercise the powers in
sections 758 and 759 for the following purposes:
                                (a)   to
determine if there is compliance with this Act and the regulations;
                                (b)   to
conduct an examination under section 756 or 757;
                                (c)   to examine any matter relating to a contract
of insurance, including the settlement or adjustment of any claim made under a contract
of insurance.
1999 cI‑5.1 s755
Annual examinations
756 The Minister must each year direct an
examiner to examine the business or affairs of each provincial company in order
to determine, for purposes related to the administration of this Act,
                                (a)   the
company’s condition and ability to meet its obligations,
                                (b)   whether
the company is following sound business and financial practices,
                                (c)   the
procedures and standards of the management of the company, and
                                (d)   whether or not the company is in compliance
with this Act, the regulations, any order under this Act and any term,
condition or restriction of its licence.
1999 cI‑5.1 s756
Special examination
757 The Minister may direct an examiner to
examine the business or affairs of a provincial company or its subsidiary for
the purposes of
                                (a)   safeguarding
the interests of the company’s policyholders,
                                (b)   safeguarding
the assets of the company or of the subsidiary, or
                                (c)   determining whether the company is able to
meet its obligations.
1999 cI‑5.1 s757
Demand for information
758(1) AnÂ
examiner may, for the purposes referred to in section 755, direct any of
the following to provide to the examiner, within a reasonable period of time
that is stipulated in the direction, any information specified by the examiner:
                                (a)   a
regulated person, a subsidiary of a regulated person, a related party, within
the meaning of that term in Part 2, Subpart 12, of a regulated person or a
holding body corporate of a regulated person;
                                (b)   a
present or former director, auditor, officer, employee or creditor of a
regulated person or the regulated person’s subsidiary or holding body
corporate;
                                (c)   an
insured.
(2) A
person served with a direction under subsection (1) who has the information
must provide the information in accordance with the direction.
(3)
Where a person served with a direction under this section does not provide the
information in accordance with the direction, the Minister may on 2 days’
written notice to that person, without affecting any sanction that the person
may be subject to under this Act, apply to the Court for an order under
subsection (4).
(4)
The Court may order the person to provide the information subject to any
conditions the Court considers appropriate if the Court is satisfied that the information
is in the possession or under the control of the person and is relevant to a
purpose referred to in section 755.
(5) An examiner may copy or otherwise record any
information provided under this section and must, within a reasonable time,
return the originals of any documents that have been provided under this
section to the person who provided them.
1999 cI‑5.1 s758
Entry into premises
759(1) Subject to subsection (6), an examiner may, for
the purposes referred to in section 755, enter at any reasonable time any
premises or place of a regulated person, a subsidiary or holding body corporate
of a regulated person or any other premises or place that the examiner believes
on reasonable grounds contains records, documents or property of a regulated
person or a subsidiary or holding body corporate of a regulated person.
(2) An
examiner who enters any premises or place under this section may require the
owner or manager of the premises or place and any other person in the premises
or at the place
                                (a)   to
give the examiner all reasonable assistance and to make reasonable efforts to
answer all the examiner’s questions,
                                (b)   to
produce for inspection or examination all records or documents that are or may
be relevant, and
                                (c)   to
produce any property of the regulated person or subsidiary or holding body
corporate of the regulated person.
(3) An
examiner may in the course of inspecting or examining records or documents
under subsection (2)
                                (a)   make
copies of or take notes from them, or
                                (b)   temporarily
remove them.
(4) Where
an examiner removes records or documents under subsection (3), the examiner
                                (a)   must
give a receipt for them to the person from whom they were taken,
                                (b)   may
make copies of, take photographs of or otherwise record them, and
                                (c)   must,
within a reasonable time, return them to the person to whom the receipt was
given.
(5) A
person who receives a request from an examiner under this section must comply
with it.
(6) When the premises or place referred to in
subsection (2) is a dwelling place, the examiner must not enter the dwelling
place without the consent of the occupant of the dwelling place.
1999 cI‑5.1 s759
Court order
760(1) If an examiner
                                (a)   is
refused entry into any premises or place referred to in section 759,
                                (b)   is
not given consent to enter a dwelling place,
                                (c)   has
reasonable grounds to believe that the examiner
                                          (i)   will be refused entry into any premises or place referred to in
section 759, or
                                         (ii)   will not be given consent to enter a dwelling place,
                                    or
                                (d)   is
impeded or has reasonable grounds to believe that the examiner will be impeded
in carrying out the examination,
the examiner may apply
to the Court for an order authorizing the examiner to enter the premises, place
or dwelling place, to carry out the examination.
(2) The
Court may, if it considers it necessary in the circumstances, hear an interim
application under subsection (1) on 2 days’ notice and make an interim order
granting such relief as the Court considers appropriate pending the
determination of the application.
(3) An
interim order under subsection (2) may be made ex parte if the Court considers
it appropriate in the circumstances.
(4) On
hearing an application, the Court may do one or more of the following:
                                (a)   authorize
the examiner to enter the premises, place or dwelling place to carry out the
examination, and may authorize the use of force so long as the examiner is
accompanied by a peace officer;
                                (b)   direct
any occupant to assist the examiner in any manner the Court directs;
                                (c)   restrain
any person from impeding the examiner from entering the premises, place or
dwelling place or from carrying out the examination;
                                (d)   make
its order subject to any terms or conditions that the Court considers
appropriate in the circumstances;
                                (e)   award costs in respect of the matter.
1999 cI‑5.1 s760
Examiner’s report
761(1) An examiner who carries out an examination
under section 756 or 757 must make a written report to the Minister that sets
out the examiner’s findings.
(2) In the case of an examination involving a
provincial company or a subsidiary or holding body corporate of a provincial
company, the Minister may provide a copy of the examiner’s report to the
company, subsidiary or holding body corporate.
1999 cI‑5.1 s761
Protection from
liability
762 No action lies against an
examiner who carries out an examination under this Division, or any person
lawfully assisting an examiner, for any act done, or alleged neglect or default
occurring, in good faith in the course of exercising powers or carrying out
duties under the examination.
1999 cI‑5.1 s762
Division 2
Appraisal of Assets
Appraisal of assets
763(1) When a provincial company or its subsidiary
takes a mortgage on real property, the lending value of the real property is
for the purposes of this section the value obtained by multiplying the market
value of the real property by 75% or any lower percentage that the company or
its subsidiary determines to be appropriate in the circumstances.
(2) If,
with respect to a provincial company or its subsidiaries, the Minister
considers that
                                (a)   the
value placed on any of the real property owned by the company or any of its
subsidiaries is too great,
                                (b)   the
amount secured by a mortgage on any real property, together with interest due
and accrued on the mortgage, is greater than the lending value of the real
property, or
                                (c)   the
market value of any other asset is less than the amount shown in the books of
the company or any of its subsidiaries,
the Minister may
require the company to secure an appraisal of the assets by one or more
competent valuators, or the Minister may arrange for the appraisal at the
expense of the company.
(3) If
the Minister arranges for the appraisal, the provincial company must co‑operate
with and provide any assistance, documents or information required by the
person performing the appraisal.
(4)
Having regard to the appraised value, the Minister may
                                (a)   substitute
the appraised value of the assets for the company’s valuation,
                                (b)   write
down the value of a loan referred to in subsection (2)(b) by an amount the
Minister considers appropriate, or
                                (c)   determine
whether the requirements of Part 2, Subpart 10 are met,
and where the Minister takes such action, the Minister must
direct the company to adjust the book value of the assets or the loan
accordingly.
1999 cI‑5.1 s763
Division 3
Ministerial Orders
Minister’s order to comply
764(1) If, in the Minister’s opinion, a person has
committed or is committing any act or pursuing any course of conduct that
                                (a)   contravenes
this Act or the regulations,
                                (b)   might
reasonably be expected, if continued, to result in a state of affairs that
would be in contravention of this Act or the regulations,
                                (c)   is
a market conduct activity that has or might reasonably be expected, if
continued, to prejudice or adversely affect people who are insured or are
interested in acquiring insurance,
                                (d)   contravenes
an undertaking given under this Act, or
                                (e)   contravenes
prescribed industry guidelines,
the Minister may give
the person a notice under subsection (3).
(2) If,
in the Minister’s opinion, a provincial company is committing any act or
pursuing any course of conduct that
                                (a)   places
the company in a position where it is carrying on business in an unsound
manner, or
                                (b)   might
reasonably be expected, if continued, to prejudice or adversely affect the
interests of policyholders,
the Minister may give
the company a notice under subsection (3).
(3) If
subsection (1) or (2) applies, the Minister may give a notice to the person
referred to in subsection (1) or to the provincial company referred to in
subsection (2) of the Minister’s intention to make a permanent order ordering
the person or company to do the following:
                                (a)   to
cease doing any act or pursuing any course of conduct specified in the notice;
                                (b)   to
perform acts specified in the notice that, in the Minister’s opinion, are
necessary to remedy the situation.
(4) If
a provincial company has a substantial investment in a body corporate referred
to in section 421(3) and, in the Minister’s opinion, the body corporate is
carrying on business in an unsound manner, the Minister may give a notice to
the company of the Minister’s intention to make a permanent order ordering the
company to do the following:
                                (a)   to
dispose of the substantial investment within a specified time;
                                (b)   to
cease doing any act or pursuing any course of conduct specified in the notice;
                                (c)   to
perform acts specified in the notice that, in the Minister’s opinion, are
necessary to remedy the situation.
(5)
If, in the Minister’s opinion, the public interest may be prejudiced or
adversely affected by any delay in the issuance of a permanent order, the
Minister may, without notice, make a temporary order dealing with the matters
in subsection (3) or (4), and the order takes effect immediately on being made.
(6) Where an order under this section would ultimately require
compliance by a subsidiary whose business activities are regulated by or under
or are otherwise subject to supervision under the Loan and Trust Corporations Act or the Securities Act, the Minister must not give a notice under
subsection (3) or make a temporary order under subsection (5) without the prior
consent in writing of the Minister responsible for the administration of the Loan and Trust Corporations Act or the Chair
of the Alberta Securities Commission, as the case may be.
(7) The
Minister must forthwith give notice to the person or provincial company of a
temporary order made under subsection (5).
(8)
A person or provincial company who receives
                                (a)   notice
of intention under subsection (3) or (4) to make a permanent order, or
                                (b)   notice
that a temporary order has been made under subsection (5)
and who wishes to have
a hearing before the Minister must serve a written request for the hearing on
the Minister within 15 days after receipt of the notice.
(9)
A temporary order made under subsection (5) becomes a permanent order at the
end of the 15th day after it is made unless the person or provincial company to
whom it is directed requests a hearing under subsection (8).
(10) Where
                                (a)   no
hearing is requested in accordance with subsection (8), or
                                (b)   a
hearing is held pursuant to a request in accordance with subsection (8) and the
Minister is of the opinion that a permanent order should be made,
the Minister may make
a permanent order, and the order takes effect immediately on being made or at a
later date specified in the order.
(11)
Where a hearing is requested under subsection (8) in respect of a temporary
order, the Minister may extend the temporary order until the hearing is
concluded.
(12)
The Minister must give a copy of an order under this section in respect of an
insurer or provincial company to each director of the insurer or company.
(13) The Minister may, after giving the person or
provincial company named in a permanent order under this section an opportunity
to be heard, confirm, modify or revoke the order.
1999 cI‑5.1 s764
Compliance undertakings
765(1) If the circumstances in section 764(1), (2) or
(4) arise, the person referred to in section 764(1) and the provincial company
referred to in section 764(2) or (4) may provide a compliance undertaking
related to the act, course of conduct or substantial investment.
(2) A
compliance undertaking must be in writing and it binds the person or provincial
company from the time it is approved by the Minister.
(3) As
long as the person or provincial company that is the subject of a compliance
undertaking complies with the terms of the undertaking, no prosecution under
this Act may be brought against the person or company in respect of the matters
that gave rise to the undertaking.
(4) The
fact that a compliance undertaking is entered into does not prevent the
Minister from making orders or taking other action under this Act against the
person or provincial company
                                (a)   on
matters not covered by the undertaking,
                                (b)   on
matters covered by the undertaking where the undertaking is not complied with,
                                (c)   on
matters covered by the undertaking where all the facts related to the matters
covered by the undertaking were not known by the Minister at the time the
undertaking was entered into, or
                                (d)   if
there has been a deterioration in the condition of the person or provincial
company.
(5) The Minister may, on the request of the person
or provincial company who is the subject of a compliance undertaking, approve
an amendment of the terms of the undertaking.
1999 cI‑5.1 s765
Protecting property
766(1) In this section, “investigated person� means
                                (a)   a
provincial company referred to in subsection (2)(a), (b) or (c) and any
subsidiary of that company,
                                (b)   the
other person referred to in subsection (2)(c) who is conducting business with a
provincial company, or
                                (c)   an
insurer or reciprocal insurance exchange referred to in subsection (2)(d).
(2) The
Minister may issue a direction under subsection (5)
                                (a)   if
the Minister is about to order an examination under section 757 of a provincial
company or its subsidiary, or during or after such an examination,
                                (b)   if
the Minister is about to cancel or suspend or has cancelled or suspended the
licence of a provincial company,
                                (c)   if
proceedings in respect of a contravention of this Act or the regulations that
are connected with or that arise out of any business conducted by a provincial
company or other person are about to be or have been instituted against the company or other person, or
                                (d)   if
proceedings are about to be or have been instituted against any unlicensed
insurer or unlicensed reciprocal insurance exchange that is undertaking
insurance in Alberta or carrying on business in Alberta.
(3) In
the circumstances referred to in subsection (2), the Minister may apply to the
Court for the appointment of a receiver, receiver‑manager or trustee to
hold or manage, as the case may be, all or part of the real and personal
property of the investigated person on any terms or conditions that the Court
approves.
(4) An
application to the Court may be made ex parte if the Court considers it proper
to do so.
(5) If
subsection (2) applies, the Minister may, in writing,
                                (a)   direct
any person having on deposit or under the person’s control or for safekeeping
any funds, securities or assets of the investigated person to hold the funds,
securities or other assets, or
                                (b)   direct
the investigated person
                                          (i)   to refrain from withdrawing such funds, securities or assets from
any person who has them on deposit or under its control or for safekeeping, or
from otherwise dealing with them, or
                                         (ii)   to hold all funds, securities or assets in the control of the
investigated person,
until the Minister in
writing revokes the direction or consents to the release of the funds,
securities or assets.
(6)
A direction issued under subsection (5) does not apply to funds or securities
in a stock exchange clearing house or to securities in process of transfer by a
transfer agent unless the direction expressly so states, and in the case of a
direction to a financial institution, the direction applies only to the
offices, branches or agencies of the financial institution that are named in
the direction.
(7)
Any person named in a direction issued under subsection (5) may apply to the
Minister for clarification as to the application of the direction to particular
funds, securities or assets.
(8)
On the application of a person directly affected by a direction issued under
subsection (5), the Minister may make an order on any terms and conditions the
Minister considers appropriate revoking the direction or consenting to the
release of any funds, securities or assets.
(9)
In any of the circumstances mentioned in subsection (2), the Minister may
notify, in writing, the Registrar of Land Titles or the Registrar of the Metis
Settlements Land Registry that action is being or is about to be taken that may
affect land belonging to the investigated person referred to in the notice, and
                                (a)   the
Registrar of Land Titles must register the notice against the title to the land
in the name of the investigated person, and
                                (b)   the
Registrar of the Metis Settlements Land Registry must record the notice against
any registered interest in the name of the investigated person.
(10)
A notice registered under subsection (9)(a) has the same effect as a
certificate of lis pendens.
(11) When
a notice is recorded against an interest in the Metis Settlements Land Registry
under subsection (9)(b), no dealings in respect of that interest by the owner
of the interest may be recorded in the Registry without the consent of the
Minister until the recording of the notice is cancelled.
(12) The Minister may in writing modify or cancel the
notice that has been registered by the Registrar of Land Titles or recorded by
the Registrar of the Metis Settlements Land Registry.
1999 cI‑5.1 s766
Order for compliance
767(1) Where it appears to the Minister that a person
has contravened
                                (a)   a
consent or approval given or an order made under this Act,
                                (b)   a
compliance undertaking entered into, or
                                (c)   a
term or condition imposed on the licence of an insurer,
the Minister may apply
to the Court for an order under subsection (2).
(2) The
Court may grant an order
                                (a)   directing
the person to comply with the consent, approval, order, undertaking or term or
condition or restraining the person from contravening the consent, approval,
order, undertaking or term or condition, and
                                (b)   where the person is a body corporate,
directing the directors and officers of the body corporate to cause the body
corporate to comply with or to cease contravening the consent, approval, order,
undertaking or term or condition.
1999 cI‑5.1 s767
Division 4
Taking Control of Assets
Order for possession and
control
768(1) The Lieutenant Governor in Council may, without
holding a hearing, order the Minister,
                                (a)   in
the case of a provincial company, to take possession and control of the assets
of the company, or
                                (b)   in
the case of an extra‑provincial company, on the request of the regulator
from the jurisdiction in which the company was incorporated, to take possession
and control of the assets of the company in Alberta.
(2) The
Lieutenant Governor in Council may make an order under subsection (1)(a) only
if
                                (a)   the
company has defaulted on payment of any of its liabilities;
                                (b)   the
company’s assets are not satisfactorily accounted for;
                                (c)   the
company’s assets are not sufficient, having regard to all the circumstances, to
give adequate protection to the company’s policyholders;
                                (d)   there
has been a transfer or issue of shares to which section 257 applies or a
purchase, acquisition or redemption to which section 244 applies and approval
has not been obtained as required by those sections;
                                (e)   the
company is in contravention of this Act or the regulations;
                                 (f)   the
company contravenes an order of the Minister or the Court under this Act.
(3) The
Minister must forthwith give a copy of an order made under subsection (1) to
the company that is subject to the order and, in the case of a provincial
company, to each director of the company.
(4)
An order under subsection (1) takes effect on the day it is made, and no such
order may be stayed, varied or set aside by any court.
(5)
For the purposes of this section, the Minister may appoint a person to value
and appraise the assets and liabilities of the company and to report on its
condition and its ability to meet its liabilities.
(6) The
company must co‑operate with the person appointed under subsection (5)
and provide the person with any assistance, documents or information the person
requires to carry out the person’s duties.
(7) Nothing in this section affects the right of
the Lieutenant Governor in Council to vary or rescind, at any time, an order
made under subsection (1).
1999 cI‑5.1 s768
Powers of Minister -
provincial companies
769(1) When the Minister takes possession and control
of the assets of a provincial company under section 768, the Minister is
responsible for the management of the business and affairs of the company and
                                (a)   must
perform all the duties and functions and may exercise all the powers of the
board, and
                                (b)   may
perform all the duties and functions and exercise all the powers of the
committees of the board, the officers, employees and agents and the
participating policyholders and shareholders at general meetings.
(2)
The Minister generally has all the powers and must do all things that are
necessary or expedient to protect the rights and interests of the
policyholders, customers and creditors and to conserve the assets of the
provincial company.
(3)
For the purposes of carrying out duties under this section, the Minister may
appoint one or more persons to manage the business and affairs of the provincial
company, and each person so appointed is a representative of the Minister.
(4)
The Minister may fix the remuneration and expenses of a person appointed under
subsection (3), other than a person who is employed in the public service of
Alberta or by a Provincial agency as defined in the Financial Administration Act.
(5)
Subject to subsection (7), the directors must not exercise any of their powers
or perform any of their duties or functions while the assets of the provincial
company are under the possession and control of the Minister, except to the
extent that they are requested to do so in writing by the Minister.
(6)
A provincial company must ensure that an ordinary or special resolution or a
resolution of any of the committees of the board passed while the assets of the
company are under the possession and control of the Minister is approved by the
Minister before it is acted on, and a resolution is ineffective until it is so
approved.
(7) Each director, officer and employee of a
provincial company must give the Minister and any person appointed by the
Minister under subsection (3) all information and assistance that they require
in the performance of their duties and functions under this section.
1999 cI‑5.1 s769
Powers of Minister -
extra-provincial company
770(1) When the Minister takes possession and control
of the assets of an extra‑provincial company in Alberta under section
768, the Minister holds and controls those assets on behalf of the regulator
from the jurisdiction in which the company was incorporated.
(2) Subject
to subsection (3), the directors must not exercise any of their powers or
perform any of their duties or functions in respect of the assets of the extra‑provincial
company in Alberta while those assets are under the possession and control of
the Minister, except to the extent that they are requested to do so by the
Minister.
(3) Each director, officer and employee of an
extra‑provincial company must give the Minister all information and
assistance that the Minister requires in the performance of the Minister’s
duties and functions under this section.
1999 cI‑5.1 s770
Application to the Court
771 Despite any other provision of this Act,
if the Minister has taken possession and control of the assets of a provincial
company under section 768, the Minister may apply to the Court for an order
                                (a)   authorizing
some other person to conduct the business of the company on the terms and
conditions the Court considers appropriate,
                                (b)   authorizing
and directing the sale of the assets of the company in whole or in part,
                                (c)   staying
any civil proceedings against the company while the Minister is in possession
and control of the assets of the company, or
                                (d)   authorizing or directing any other action
the Court considers appropriate and in the best interests of the policyholders
or shareholders.
1999 cI‑5.1 s771
Termination of
possession and control
772(1) If the Lieutenant Governor in Council believes
that a provincial company whose assets are under the Minister’s possession and control
meets the requirements of this Act and that it is otherwise proper for the
company to resume possession and control of its assets and the conduct of its
business, the Lieutenant Governor in Council may restore to the company the
possession and control of its assets, and in that case the powers of the
Minister under section 769 cease.
(2) If
the Lieutenant Governor in Council believes that further efforts to
rehabilitate a provincial company whose assets are under the Minister’s
possession and control would be futile, the Lieutenant Governor in Council may
                                (a)   direct
the Minister to apply to the Court for an order liquidating and dissolving the
company, or
                                (b)   restore
to the company the possession and control of its assets in order that the
company may engage in a course of action agreed to by the Lieutenant Governor
in Council,
and in that case the
powers of the Minister under section 769 cease.
(3) If the regulator of the jurisdiction in which
an extra‑provincial company has been incorporated advises the Minister
that it is no longer necessary for the Minister to have possession and control
of the assets of the company in Alberta, the Lieutenant Governor in Council may
order that the Minister no longer has possession and control of those assets.
1999 cI‑5.1 s772
Payment of expenses of
proceeding
773 The provincial or extra‑provincial
company whose assets the Minister has taken possession and control of is liable
to the Government for the expenses of the Government incurred in carrying out
sections 768 to 772 and the Government may recover the expenses by civil action
for debt.
1999 cI‑5.1 s773
Division 5
Remedial Actions
Definitions
774 In this Division,
                                (a)   “action�
means an action under this Act or any other law;
                                (b)   “complainant�
means
                                          (i)   the Minister,
                                         (ii)   a registered holder or beneficial owner, or a former registered
holder or beneficial owner, of a security of a provincial company or of any of
its affiliates,
                                        (iii)   a director or an officer or a former director or officer of a
provincial company or of any of its affiliates,
                                        (iv)   a participating policyholder or former participating policyholder
of a provincial company, or
                                         (v)   any other person who, in the opinion of the
Court, is a proper person to make an application under section 775 or 776.
1999 cI‑5.1 s774
Derivative action
775(1) Subject to subsection (2), a complainant may
apply to the Court for leave to
                                (a)   bring
an action in the name of and on behalf of a provincial company or any of its
subsidiaries, or
                                (b)   intervene
in an action to which a provincial company or any of its subsidiaries is a
party, for the purpose of prosecuting, defending or discontinuing the action on
behalf of the company or subsidiary.
(2)
No leave may be granted under subsection (1) unless the Court is satisfied that
                                (a)   the
complainant has given reasonable notice to the directors of the provincial
company or its subsidiary of the complainant’s intention to apply to the Court
under subsection (1) if the directors of the company or its subsidiary do not
bring, diligently prosecute, defend or discontinue the action,
                                (b)   the
complainant is acting in good faith, and
                                (c)   it
appears to be in the interests of the provincial company or its subsidiary that
the action be brought, prosecuted, defended or discontinued.
(3)
In connection with an action brought or intervened in under this section, the
Court may at any time make any order it thinks fit, including, without limiting
the generality of the foregoing, any or all of the following:
                                (a)   an
order authorizing the complainant or any other person to control the conduct of
the action;
                                (b)   an
order giving directions for the conduct of the action;
                                (c)   an
order directing that any amount adjudged payable by a defendant in the action
must be paid, in whole or in part, directly to a former or present security
holder of the provincial company or its subsidiary instead of to the company or
its subsidiary;
                                (d)   an order requiring the provincial company or
its subsidiary to pay reasonable legal fees incurred by the complainant in
connection with the action.
1999 cI‑5.1 s775
Relief by Court from
oppression or unfairness
776(1) A complainant may apply to the Court for an
order under this section.
(2)
Where, on an application under subsection (1), the Court is satisfied that in
respect of a provincial company or any of its affiliates
                                (a)   any
act or omission of the company or any of its affiliates effects or threatens to
effect a result,
                                (b)   the
business or affairs of the company or any of its affiliates are, have been or
are threatened to be carried on or conducted in a manner, or
                                (c)   the
powers of the directors of the company or any of its affiliates are, have been
or are threatened to be exercised in a manner,
that is oppressive or
unfairly prejudicial to or that unfairly disregards the interests of any
participating policyholder, security holder or creditor, the Court may make an
order to rectify the matters complained of.
(3)
On an application under subsection (1), the Court may make any interim or final
order it considers appropriate, including, without limitation, any or all of
the following orders:
                                (a)   an
order restraining the conduct complained of;
                                (b)   an
order to regulate the company’s affairs by amending its bylaws;
                                (c)   an
order appointing directors in place of or in addition to all or any of the
directors then in office;
                                (d)   an
order directing an issue or exchange of securities;
                                (e)   an
order directing the provincial company to purchase securities of a security
holder;
                                 (f)   an
order directing the provincial company or any other person to pay to a security
holder any part of the money paid by the security holder for securities;
                                (g)   an
order directing the company, subject to section 253(3), to pay a dividend to
its participating policyholders or shareholders or a class of its participating
policyholders or shareholders;
                                (h)   an
order varying or setting aside a transaction or contract to which the
provincial company is a party and compensating the company or any other party
to the transaction or contract;
                                 (i)   an
order requiring the provincial company, within a time specified by the Court,
to produce to the Court or an interested person financial statements or an
accounting in any other form the Court determines;
                                 (j)   an
order compensating an aggrieved person;
                                (k)   an
order directing rectification of the registers or other records of the
provincial company;
                                 (l)   an
order requiring the trial of any issue;
                               (m)   an order for the liquidation and dissolution
of the provincial company.
1999 cI‑5.1 s776
Notice of application
777 Where a person other than the
Minister makes an application under section 775 or 776, that person must give
notice of the application to the Minister, and the Minister may appear and be
heard in person or by counsel.
1999 cI‑5.1 s777
Costs
778(1) A complainant is not required to give security
for costs in any application made or action brought or intervened in under
section 775 or 776.
(2) In an application made or an action brought or
intervened in under section 775 or 776, the Court may at any time order the
provincial company or its subsidiary to pay to the complainant interim costs,
including legal fees and disbursements, but the complainant may be held
accountable for the interim costs on final disposition of the application or
action.
1999 cI‑5.1 s778
Stay, etc., of
application or action
779(1) An application made or an action brought or
intervened in under section 775 or 776 must not be stayed or dismissed by
reason only that it is shown that an alleged breach of a right or duty owed to
the provincial company or its subsidiary has been or may be approved by the
shareholders of the company or the subsidiary, but evidence of approval by the
shareholders may be taken into account by the Court in making an order under
section 775 or 776.
(2) An application made or an action brought or
intervened in under section 775 or 776 must not be stayed, discontinued,
settled or dismissed for want of prosecution without the approval of the Court
given on any terms the Court considers appropriate, and if the Court determines
that the interests of any complainant may be substantially affected by the
stay, discontinuance, settlement or dismissal, the Court may order any party to
the application or action to give notice to the complainant.
1999 cI‑5.1 s779
Subpart 2
Offences and Penalties
Offences
780 A person who contravenes any of the
following provisions is guilty of an offence:
                                (a)   in
Part 1,
                                          (i)   in Subpart 1, sections 18, 25(2), 31(1), 36, 39(1) and (5), 40,
41, 43(1), (2) and (4), 44(1), 45, 46(1), 47(1), 49, 50 and 56;
                                         (ii)   in Subpart 2, sections 68(2), 71, 72, 73, 74(1) and 75;
                                        (iii)   in Subpart 3, sections 79, 88, 91(1), 94(1) and (5), 95, 96, 98,
99, 100(1), 102, 103 and 104;
                                (b)   in
Part 2,
                                          (i)   in Subpart 1, sections 110(1), 112, 113(1), 114, 115, 116(1), 117
and 118;
                                         (ii)   in Subpart 2, sections 132(1), 133, 135, 136, 137, 138, 140(4)
and (5), 176(1), (3) and (5), 180(1), 187(3), 207, 211(1) and 213;
                                        (iii)   in Subpart 3, sections 216, 217(1) and (2), 218(1), 219(1),
220(1), 221, 222(3) and (6), 223, 224 and 225;
                                        (iv)   in Subpart 4, sections 232(1) and (3), 233(1), 234(3), 235(1),
(2) and (3), 238(2), 241(1) and (2), 242(3), 243(1) and (4), 245(2) and (3),
246(3), 247(2), 249(3), 250(1), (2), (3) and (4), 253(2) and (3), 257(1), (2),
(3) and (4), 262(1) and 263(2) and (3);
                                         (v)   in Subpart 5, sections 268(a) and (b), 270, 274(2) and (3),
275(1), 276(1), 282(2), 284(1), 292(1), 294(1), 295, 296, 297, 298, 300(2) and
(3), 304(1), 305(1) and (2), 306(1) and 307(2), (3), (4) and (5);
                                        (vi)   in Subpart 6, sections 309(2), 310(1) and (2), 315(1) and (2),
316(2), 326(2), 327(1) and (2), 341(2), 343, 346(3) and (4), 347(3) and (4),
348, 350(2), 351(1) and 354(1) and (4);
                                       (vii)   in Subpart 8, sections 372(1), 375(1), 378(1), 379, 381(2),
382(1), 383, 385(1), 386(1) and (3), 387, 388(2), 389 and 390(1) and (2);
                                      (viii)   in Subpart 9, sections 393, 398(2), 401, 402, 403, 404(1), 405,
407(1), 408 and 409;
                                        (ix)   in Subpart 10, sections 413(3) and 414(2) and (6);
                                         (x)   in Subpart 11, sections 416(1), 417, 418(1), 419(1), 420(1),
421(1), 422, 425(1), 426, 427, 428, 429, 430 and 431(2);
                                        (xi)   in Subpart 12, sections 437, 439(2), 442(1), (3), (4), (5) and
(6), 444, 445(1), (3) and (5) and 446(1), (2) and (5);
                                (c)   in
Part 3, sections 452, 455(1), (2), (3) and (4), 457, 458(3), 460, 462(1), (2)
and (3), 470(2), 473(2), 474(1), (2) and (3), 475(1) and (4), 476, 477, 478(1),
479, 481(2), 485, 486, 487, 488, 489, 490 and 491;
                                (d)   in
Part 4, sections 499, 500, 501(2) and (3), 502(2), 505(2), 506, 508 and 509;
                                (e)   in
Part 5,
                                          (i)   in Subpart 1, sections 525(1) and 535(2), (4) and (5);
                                         (ii)   in Subpart 2, sections 538(1), (2) and (3), 539 and 540(2) and
(3);
                                        (iii)   in Subpart 5, sections 610(1) and (8), 613.1(2), 627(6), 659 and
660(1) and (2);
                                        (iv)   in Subpart 6, section 698;
                                 (f)   in
Part 6, Subpart 1, sections 758(2), 759(5), 768(6), 769(5), (6) and (7) and
770(2) and (3);
                                (g)   in Part 7, sections 822(2), (3), (4) and (5)
and 825(4).
RSA 2000 cI‑3
s780;2003 c40 s19
Offences
781 A person who
                                (a)   contravenes
an order or direction made under section 21(4), 327(2), 423, 480.1, 507, 661.1,
764, 766 or 788,
                                (b)   contravenes
a regulation specified by the Lieutenant Governor in Council under section 790,
                                (c)   contravenes
a written undertaking given under this Act,
                             (c.1)   contravenes
a written procedure established by the Superintendent under section 658,
                                (d)   fails
to report to the Minister or Superintendent as required by this Act,
                                (e)   being
a licensed insurer, contravenes any term or condition to which a licence is
subject, or
                                 (f)   being
a provincial company, contravenes any term or condition to which its instrument
of incorporation is subject
is guilty of an offence.
RSA 2000 cI‑3
s781;2001 c9 s12;2003 c40 s20
Statements of financial
standing
782 Every person who represents orally or in
writing that
                                (a)   the
issue of a licence to an insurer,
                                (b)   the
printing or publication of a financial statement of a provincial company in a
report of the Minister, or
                                (c)   the
supervision or regulation of the business of an insurer by this Act or the
regulations or by the Minister
is a warranty or guarantee of the financial standing of the
insurer or of its ability to provide for the payment of its contracts at
maturity is guilty of an offence.
1999 cI‑5.1 s782
False or deceptive
statements
783(1) A person who makes any wilfully false or
deceptive statement in any register, book of account, accounting record,
minute, financial statement or other record or document respecting the affairs
of a licensed insurer or in any statement, return, report or reply to the
Minister is guilty of an offence.
(2) A
director, officer or employee of a licensed insurer and every member or
employee of a firm of accountants appointed as the auditor of a provincial
company who
                                (a)   prepares,
signs, approves or concurs in any register, book of account, accounting record,
minute, financial statement or other record or document respecting the affairs
of the insurer, or any statement, return, report or reply to the Minister, that
the person knows to contain a false or deceptive statement, or
                                (b)   uses
a record or document referred to in clause (a) with intent to deceive or
mislead any person,
is guilty of an offence.
1999 cI‑5.1 s783
Trafficking in life
insurance policies
784 Any person, other than a licensed life company,
who
                                (a)   through
advertisements or other means makes it known that the person is willing to
purchase life insurance policies or the benefits under those policies, or
                                (b)   traffics
or trades in life insurance policies for the purpose of procuring the sale,
surrender, transfer, assignment, pledge or hypothecation of the benefits under
those policies to any person
is guilty of an offence.
1999 cI‑5.1 s784
Liability of directors
and officers
785 If a body corporate commits an
offence under this Act, then, whether or not the body corporate has been
prosecuted or convicted in respect of the offence, any director or officer of
the body corporate who knowingly authorizes, permits or acquiesces in the
commission of the offence is guilty of the offence.
1999 cI‑5.1 s785
General penalty
786(1) A person who is convicted of an offence is
liable to a fine of not more than $200 000.
(2) If an act or omission is an offence under this
Act or the regulations and the act or omission is of a continuing nature, each
day or part of a day that it continues constitutes a separate offence.
1999 cI‑5.1 s786
Limitation on
prosecution
787 A prosecution in respect of an
offence under this Act must not be commenced after 3 years from the date that
the facts that constitute the alleged offence become known to the Minister.
1999 cI‑5.1 s787
Order to comply and make
restitution
788 A justice who convicts a defendant of an
offence under this Act or the regulations may, in addition to any other penalty
the justice may impose, order the defendant
                                (a)   to
comply with, within a specified time, the provision of this Act or the
regulations on which the conviction is based, and
                                (b)   on the application of an aggrieved person,
to make restitution to a maximum of $100 000 for loss of or damage to
property suffered by the applicant as a result of the commission of the
offence.
1999 cI‑5.1 s788
Administrative penalties
789(1) Where the Minister is of the opinion that a
person has contravened a prescribed provision of this Act or the regulations or
has contravened a written procedure established by the Superintendent under
section 658 or an order under section 661.1(2), the Minister may by notice in
writing given to that person require that person to pay to the Government an
administrative penalty by a date specified in the notice in the amount set out
in the notice for each day or part of a day the contravention occurs or
continues.
(2) A
person who pays an administrative penalty by the date specified in the notice
in respect of a contravention must not be charged under this Act with an
offence in respect of that contravention.
(3) A
notice of an administrative penalty must not be issued after 2 years from the
later of
                                (a)   the
date on which the contravention to which the notice relates occurred, and
                                (b)   the date on which evidence of the
contravention first came to the attention of the Minister.
RSA 2000 cI‑3
s789;2003 c40 s21
Regulations
790 The Lieutenant Governor in Council may
make regulations
                                (a)   providing
that the contravention of any provision of the regulations under this Act
constitutes an offence;
                                (b)   prescribing
the form and contents of notices of administrative penalties for the purpose of
section 789;
                                (c)   prescribing
contraventions of provisions of this Act or the regulations in respect of which
an administrative penalty may be imposed and prescribing the amounts, or the
manner of determining the amounts, of the administrative penalties that may be
imposed, not to exceed $10 000 for each contravention;
                                (d)   respecting any other matter necessary for
the administration of the system of administrative penalties.
1999 cI‑5.1 s790
Subpart 3
Administration, Appeals and
General Matters
Administration
Delegation of powers
791(1) Subject to subsections (2) and (3), the
Minister may delegate in writing any power, duty or function conferred or
imposed on the Minister by this Act or the regulations to any person and may
authorize the person to further delegate the power, function or duty.
(2) The
Minister must not delegate the power
                                (a)   to
make regulations,
                                (b)   to
make an order under section 764,
                                (c)   to
make recommendations to the Lieutenant Governor in Council,
                                (d)   to
make a direction under section 766, or
                                (e)   to
make an application to the Court under section 767.
(3) The only powers, duties and functions that the
Minister may delegate to an insurance council are specified under section
498(m).
1999 cI‑5.1 s791
Superintendent of
Insurance
792(1) The Minister may appoint a Superintendent of
Insurance and a Deputy Superintendent of Insurance.
(2) The
Superintendent may delegate any power, duty or function conferred or imposed on
the Superintendent by this Act or the regulations to any person and may
authorize the person to further delegate the power, duty or function.
(3) The Deputy Superintendent of Insurance has all
of the powers, duties and functions of the Superintendent.
1999 cI‑5.1 s792
Guidelines and
interpretation bulletins
792.1 The Superintendent may issue guidelines
and interpretation bulletins respecting the interpretation or application of
this Act or any one or more regulations under this Act.
2005 c27 s17
Examiners
793(1) The Minister may appoint one or more examiners.
(2) An
appointment may name an individual or the holder of an office or position to be
an examiner.
(3) The Superintendent and Deputy Superintendent
are examiners.
1999 cI‑5.1 s793
Insurance Register
794(1) The Minister must maintain a register known as
the “Insurance Register�.
(2) The
Register must contain the following information with respect to insurers:
                                (a)   the
name of each insurer that has been issued a licence;
                                (b)   all
terms, conditions and restrictions imposed on the licence of the insurer;
                                (c)   the
classes of insurance that the insurer is authorized to carry on in Alberta;
                                (d)   the
name and address of the insurer’s attorney for service;
                                (e)   the
address of the insurer’s chief agency in Alberta;
                                 (f)   information
on the suspension or cancellation of the licence of an insurer;
                                (g)   any
compliance undertaking provided by an insurer;
                                (h)   any
other prescribed information.
(3) The
Register must contain the following information with respect to special
brokers:
                                (a)   the
name and business address of each special broker that has been issued a special
broker’s licence;
                                (b)   the
classes of insurance in respect of which the special broker is authorized to
transact business;
                                (c)   information
on the suspension or cancellation of the licence of a special broker;
                                (d)   any
other prescribed information.
(4) The
Register must contain the following information with respect to reciprocal
insurance exchanges:
                                (a)   the
name of each exchange that has been issued a licence under Part 1, Subpart 3;
                                (b)   the
name and business address of the principal attorney of each exchange that has
been issued a licence under Part 1, Subpart 3;
                                (c)   the
classes of insurance that the exchange is authorized to undertake;
                                (d)   if
an exchange has an attorney for service, the name and address of the attorney;
                                (e)   information
on the suspension or cancellation of the licence of an exchange;
                                 (f)   any
compliance undertaking provided by an exchange;
                                (g)   any
other prescribed information.
(5) The
Register must contain the following information with respect to insurance
agents and adjusters:
                                (a)   the
name and business address of each insurance agent and adjuster that has been
issued a certificate of authority;
                                (b)   all
terms and conditions imposed on the certificate of authority of the insurance
agent or adjuster;
                                (c)   in
the case of an insurance agent, the classes of insurance in respect of which
the insurance agent is authorized to transact business;
                                (d)   the
name and business address of the insurance agent’s or adjuster’s designated
representative, if there is one;
                                (e)   information
on the suspension or cancellation of a certificate of authority;
                                 (f)   any
compliance undertaking provided by an insurance agent or adjuster;
                                (g)   any
other prescribed information.
(6) The Register may be maintained in any form that
the Minister considers to be appropriate so long as copies of the Register can
be made.
1999 cI‑5.1 s794
Inspection and copies of
Register
795 The Minister must on the request of any
person
                                (a)   allow
the person to inspect the information in the Insurance Register, and
                                (b)   provide a copy of the information in the
Insurance Register.
1999 cI‑5.1 s795
Extension of time
796 If something is required to be
done under this Act or the regulations within a certain period of time, the
Minister may, on written application of the person who must do the thing, made
before the expiration of the period of time, extend the time within which the
thing must be done.
1999 cI‑5.1 s796
Approval and consent
797(1) If this Act or the regulations provide for the
giving of approval or consent by the Minister, the Minister may make the
approval or consent subject to any terms and conditions the Minister considers
appropriate.
(2)
An approval or consent must be in writing.
(3) Before refusing an approval or consent or
granting an approval or consent subject to terms and conditions, the Minister
must give the person seeking the approval or consent notice of the proposed
decision and an opportunity to be heard on the matter.
1999 cI‑5.1 s797
Orders, etc., binding on
successors
798 An order, consent,
undertaking, compliance undertaking or approval made or given under this Act,
or a term, condition or restriction imposed on the licence of a licensed
insurer is binding on the successors of the person or insurer to whom it
relates.
1999 cI‑5.1 s798
Publication by Minister
799(1) The Minister may authorize the publication of
notices, reports, correspondence, results of hearings, sanctions, decisions and
any other matter considered by the Minister to be in the public interest.
(2) The Minister may prepare and publish a report
respecting the insurance undertaken by each licensed insurer during the
previous year.
1999 cI‑5.1 s799
Matters under oath
800(1) The Minister may require that a document or a
fact stated in a document required by this Act or the regulations to be sent to
the Minister be verified by affidavit or declaration.
(2) For the purposes of this Act, the
Superintendent and the Deputy Superintendent may administer oaths and take and
receive affidavits and declarations.
1999 cI‑5.1 s800
Fees
801(1) The Minister may establish and charge fees for
filing or issuing any licence or other document under this Act or the
regulations or for any approval, consent, service or other thing given or done
by or under the authority of the Lieutenant Governor in Council, the Minister
or the Superintendent under this Act or the regulations.
(2) Despite
any other provision in this Act or the regulations, the Lieutenant Governor in
Council, Minister or Superintendent may refuse to file or issue a licence or
other document or give or provide an approval, consent, service or thing under this Act or the
regulations unless the fee established under subsection (1) or a fine imposed
on the person requesting the action on a conviction of an offence under this
Act or the regulations is paid.
(3) Subject
to section 802, a person who is charged a fee under subsection (1) must pay the
fee
                                (a)   before
the filing or other thing is given or done, or
                                (b)   within the time specified by the Minister.
1999 cI‑5.1 s801
Penalty
802 All fees imposed by this Act
on an insurer or reciprocal insurance exchange become due and payable
immediately on the undertaking of insurance by the insurer or reciprocal
exchange and, if the fees are not paid within 30 days from the time they become
due and payable, a sum equal to 50% of the fees remaining unpaid becomes a
penalty that forms a part of the fees and is recoverable with the fees.
1999 cI‑5.1 s802
Forms
803(1) The Minister may establish forms for the
purposes of this Act and the regulations.
(2) When the Minister establishes a form under
subsection (1), that form must be usedÂ
for the purposes of this Act and the regulations.
1999 cI‑5.1 s803
Filing by electronic
means
804 Any document that is required
to be filed with or submitted to the Minister under this Act or the regulations
may be filed by an electronic means and in a format approved by the Minister.
1999 cI‑5.1 s804
Priority of Government
claim
805(1) If, with respect to any provincial company, the
Government pays money by way of expenditure certified by the Minister as having
been incurred by the Government in the course of the Minister’s administration
of this Act that directly relates to the company, the money so paid may be
recovered by the Government from the company by an action in debt.
(2) Claims by the Government against a provincial
company in respect of any money referred to in subsection (1) rank, on the
winding‑up of the company, immediately after the remuneration of the
liquidator and of the receiver and manager, if any, and before any other
claims.
1999 cI‑5.1 s805
Appeals
Review by review board
806(1) The Minister must serve each person who is
directly affected by the following decisions with a written notice of the
decision and the reasons for the decision:
                                (a)   an
order of the Minister under section 21(4);
                                (b)   the
Minister’s rejection of an application for licence on the basis of non‑compliance
with section 25(b);
                                (c)   the
Minister’s decision under section 54(6) or (7);
                                (d)   the
Minister’s refusal to approve a proposed continuance under section 147(1)(b);
                                (e)   the
Minister’s refusal to approve an agreement under section 161 on the basis of
section 161(3)(a);
                                 (f)   the
Minister’s refusal to approve a voluntary liquidation and dissolution under
section 187;
                                (g)   the
refusal to issue or amend an instrument of incorporation in respect of a
provincial company because the proposed name of the provincial company does not
comply with section 211(1);
                                (h)   the
refusal to licence an insurer because the name of the insurer does not comply
with section 211(1);
                                 (i)   the
decision to issue a certificate of change of name of a provincial company under
section 211(3);
                                 (j)   the
Minister’s refusal of consent under section 257 on the basis of section 262(2);
                                (k)   an
order of the Minister under section 423;
                                 (l)   the
Minister’s designation, or refusal to revoke the designation, of a person as a
related party under section 435;
                              (l.1)   an
order of the Minister under section 480.1;
                               (m)   the
making of a permanent order under section 753(10);
                                (n)   any
other prescribed decision of the Minister.
(2) A
person who is directly affected by a decision referred to in subsection (1) and
who feels aggrieved by the decision may object to the decision by serving on
the Minister a notice of objection, specifying the decision objected to and the
grounds for the objection, within 90 days after being served with the notice of
the decision.
(3)
The Minister must, within 30 days after being served with a notice of
objection, appoint a review board to conduct a review of the matter objected
to, unless the Minister decides within that period to reverse the decision.
(4)
A review board consists of one person designated by the Minister as presiding
officer and not fewer than 2 nor more than 4 other persons.
(5) The
Minister must not appoint to any review board persons who are employed in a
part of the public service of Alberta under the Minister’s administration.
(6)
The Minister may pay fees and travelling and living expenses that the Minister
considers proper to the members of a review board.
(7)
The Minister must set a period, not exceeding 90 days, within which the review
board is to conduct the review and give its written decision, and may extend
that period or any extension of that period, before its expiry, by further
periods not exceeding 45 days.
(8)
Sections 4, 5, 8, 9, 10, 11 and 12 of the Public
Inquiries Act apply to a review under this section.
(9)
The review board may confirm, rescind or vary the decision reviewed.
(10)
The review board must, forthwith after making its decision, serve a copy of its
decision, including the reasons for it, on the objector and the Minister.
(11) Subject to this section and the regulations, a
review board may make rules governing its own procedure and business.
RSA 2000 cI‑3
s806;2001 c9 s13
Recording of evidence
807 Oral evidence taken before the
Minister or before a review board established under section 806 may be recorded
by a stenographer or otherwise recorded, and copies of a transcript of the
evidence must be furnished to the parties to the proceeding on request and on
the terms and for the same fees as are applicable to transcripts in proceedings
in the Court.
1999 cI‑5.1 s807
Consent to apply to
Court directly
808(1) An objector may, in a notice of objection
under section 806, apply to the Minister for consent to apply directly to the
Court under section 809 without having a review conducted under section 806,
and if the Minister considers the matter should go directly to the Court, the
Minister may, by notice in writing to that objector, consent to a direct application
to the Court.
(2) Where
the Minister gives consent under subsection (1), the objector waives the right
to a review under section 806.
(3) Where
                                (a)   any
period established under section 806(7) expires without having been extended or
further extended under that subsection, and
                                (b)   the
review board has not made its decision,
the objector has a right to elect to apply directly to the
Court pursuant to section 809 or to allow the review board to give its decision
after the expiration of that period.
1999 cI‑5.1 s808
Application to Court
809(1) An objector who receives a copy of a review
board’s decision under section 806, the Minister and an objector to whom
section 808 applies may apply to the Court for an order under this section.
(2) Where
the application is made by an objector to whom section 808(1) applies, the
application must be accompanied with the consent given under that subsection.
(3)
An application under this section must
                                (a)   be
filed in the office of the clerk of the Court and served on the other persons
who received a copy of the decision within 30 days after the applicant received
the decision or the expiry of the period referred to in section 806(7), as the
case may be, or within any longer period the Court allows, and
                                (b)   be
made returnable within 90 days after the date of filing of the application.
(4) On hearing the application, the Court may
confirm, rescind or vary the decision of the review board and may make any
other order it considers appropriate.
1999 cI‑5.1 s809
Stay
810(1) Subject to this section, neither an objection
nor an application to the Court operates as a stay of the decision objected to
or appealed from.
(2)
The review board or the Court, as the case may be, may grant a stay in respect
of a decision referred to in section 806(1)(a), (i), (l) or (m) or any other
prescribed decision.
(3) Where a review board decides against the
Minister in the case of a decision referred to in section 806(1)(b), (g), (h),
(i) or (n) and the Minister applies to the Court under section 809 in respect
of the decision, the Minister need not act under the provisions referred to in
those clauses pending the Court’s decision.
1999 cI‑5.1 s810
General
Published notice as
evidence
811 A notice published in The Alberta Gazette over
the name of the Minister or Superintendent is proof, in the absence of evidence
to the contrary, of the facts stated in the notice.
1999 cI‑5.1 s811
Certificate evidence
812 A certificate of the Minister
or the Superintendent is admissible as evidence in any civil, criminal or
administrative action or proceeding without proof of the signature or official
character of the person appearing to have signed it, and the certificate is
proof, in the absence of evidence to the contrary, of the facts set out in the
certificate.
1999 cI‑5.1 s812
Copies of documents as
evidence
813 Copies of, or extracts from, any book, record,
instrument or document in the office of the Minister or of or from any
instrument or document issued under this Act, if certified by the Minister to
be true copies or extracts, have the same legal effect as the original.
1999 cI‑5.1 s813
Photocopies of documents
814 If a notice or document is
required under this Act to be sent to the Minister, the Minister may accept a
copy of the notice or document.
1999 cI‑5.1 s814
Court applications
815 An application to the Court
made under this Act or the regulations may be made by originating notice.
1999 cI‑5.1 s815
Confidentiality of
information
816(1) In this section,
                                (a)   “insurer
information� means information that the Minister or the Minister’s officials
obtain or create for the purpose of administering or enforcing this Act and the
regulations and that relates to the business or affairs of an insurer, a
reciprocal insurance exchange or a dissolved insurer or to an application for
incorporation of a provincial company;
                                (b)   “Minister’s
officials� means
                                          (i)   any person acting under the Minister’s direction or authority for
the purposes of the administration or enforcement of this Act and the regulations,
                                         (ii)   the Superintendent and Deputy Superintendent of Insurance, and
                                        (iii)   any person who exercises or performs a power, duty or function
delegated under this Act or the regulations.
(2) Insurer
information is confidential and neither the Minister, nor the Minister’s
officials, may disclose or provide insurer information to any person except in
accordance with this section.
(3) The
Minister may disclose and provide insurer information to the Minister’s
officials and the Minister’s officials may disclose and provide insurer
information to the Minister and other Minister’s officials.
(4) The
Minister, and with the approval of the Minister, the Minister’s officials may
disclose or provide insurer information to
                                (a)   the
insurer, reciprocal insurance exchange or applicants applying for the
incorporation of a provincial company that are the subject of the information,
                                (b)   the
auditor or actuary of an insurer for the purposes of carrying out the functions
of auditor or actuary, as the case may be,
                                (c)   a
law enforcement authority for the purposes of law enforcement,
                                (d)   the
government of any other province or territory or of Canada, or an agency of
such a government for a purpose approved by the Minister,
                                (e)   any
employee or member of the Alberta Securities Commission for the purposes of the
administration or enforcement of the Securities
Act,
                                 (f)   any
employee in the public service of Alberta who is involved in the administration
of the Loan and Trust Corporations Act
for the purposes of the administration or enforcement of that Act,
                                (g)   any
employee in the public service of Alberta who is involved in the administration
of the Credit Union Act for the
purposes of the administration or enforcement of that Act, or
                                (h)   any
prescribed person for any prescribed purpose.
(5) A
person to whom information is communicated or provided under subsection (3) for
a specified purpose and any person acting under that person’s authority or
direction or to whose notice information comes as a result of any relationship
with that person may use the information only for that purpose.
(6) Where,
for the purposes of the administration of this Act or the regulations, the
Minister receives information from the government of or a public body of Canada
or any other province or territory, neither the Minister nor the Minister’s
officials may disclose the information other than with the consent of that
government or public body.
(7) This
section does not apply to disclosure or provision of insurer information when
the information
                                (a)   is
provided under section 761(2),
                                (b)   is
disclosed or provided from the Insurance Register under section 795, or
                                (c)   is
disclosed or provided in a report or other thing that is published under
section 799.
(8) Despite the Freedom
of Information and Protection of Privacy Act, that Act does not apply to
insurer information.
1999 cI‑5.1 s816
Compensation Associations
Agreements with
compensation associations
817 The Minister may enter into
agreements with compensation associations relating to a plan for the
compensation by compensation associations of policyholders and eligible
claimants of insolvent insurers.
1999 cI‑5.1 s817
Compensation association
regulations
818 The Lieutenant Governor in Council may
make regulations
                                (a)   designating
a compensation association that has entered into an agreement with the Minister
under section 817 as a compensation association for one or more classes of
insurance;
                                (b)   designating an insurer as being adequately
covered by a plan of compensation other than that provided by reason of
membership in a designated compensation association.
1999 cI‑5.1 s818
Compensation
associations
819(1) When an entity has been designated by the
regulations as a compensation association for a class of insurance, every
insurer, while licensed to carry on that class of insurance and for 180 days
after ceasing to be licensed, is a member of that compensation association.
(2) Subsection
(1) does not apply to an insurer that is designated by a regulation under
section 818(b) or whose business is limited to that of reinsurance.
(3) Every
member of a designated compensation association is bound by the bylaws and
memorandum of operation of the compensation association.
(4) A
member of a designated compensation association must pay to the compensation
association all assessments and levies made against the member by the
compensation association.
(5) If
a member fails to pay an assessment or levy within 30 days after the mailing of
the notice of the assessment or levy to the member,
                                (a)   the
designated compensation association may claim the amount of the assessment or
levy, with interest, as a debt due from the member, and
                                (b)   the
Minister may suspend the member’s licence subject to any terms or conditions
the Minister considers appropriate or cancel the member’s licence.
(6) The
debt due under subsection (5)(a) does not cease to be due on the termination of
the member’s membership.
(7) Before
suspending or cancelling a member’s licence under subsection (5)(b), the
Minister must notify the insurer of the proposed suspension or cancellation and
provide the insurer with an opportunity to make representations to the
Minister.
(8) When
an insurer’s licence is cancelled under subsection (5)(b), the insurer must
cease to carry on business in Alberta, except so far as is necessary for the
winding‑up of its business in Alberta.
(9) When an insurer’s licence is suspended under
subsection (5)(b), the insurer must cease to carry on business in Alberta in
accordance with the terms and conditions of the suspension.
1999 cI‑5.1 s819
General Insurance
OmbudService
819.1(1) Every
insurer, while licensed to undertake automobile insurance or any other
prescribed class of insurance, is a member of the General Insurance
OmbudService incorporated under the Canada Corporations Act (Canada) or
any other entity designated by the Minister in substitution for the General
Insurance OmbudService.
(2) Every member of the General
Insurance OmbudService is bound by the bylaws and memorandum of operation of
the General Insurance OmbudService.
(3) A member of the General Insurance
OmbudService must pay to it all assessments and levies made against the member
by the General Insurance OmbudService.
(4) If a member fails to pay an
assessment or levy within 30 days after the mailing of the notice of the
assessment or levy to the member,
                                (a)   the
General Insurance OmbudService may claim the amount of the assessment or levy,
with interest, as a debt due from the member, and
                                (b)   the
Minister may suspend the member’s licence subject to any terms or conditions
the Minister considers appropriate or cancel the member’s licence.
(5) The debt due under subsection (4)(a)
does not cease to be due on the termination of the member’s membership.
(6) Before suspending or cancelling a member’s
licence under subsection (4)(b), the Minister must notify the insurer of the
proposed suspension or cancellation and provide the insurer with an opportunity
to make representations to the Minister.
(7) When an insurer’s licence is
cancelled under subsection (4)(b), the insurer must cease to carry on business
in Alberta, except so far as is necessary for the winding‑up of its
business in Alberta.
(8) When an insurer’s licence is
suspended under subsection (4)(b), the insurer must cease to carry on business
in Alberta in accordance with the terms and conditions of the suspension.
(9) If,
under subsection (1), the Minister designates another entity in substitution
for the General Insurance OmbudService, every insurer, while licensed to
undertake automobile insurance or any other prescribed class of insurance, is a
member of that entity and is not by virtue of this section a member of the
General Insurance OmbudService, and all references to the General Insurance
OmbudService in subsections (2) to (4) shall be read as references to that
entity.
2005 c27 s18
Regulations
Regulations
820 The Lieutenant Governor in
Council may make regulations respecting any matter that is to be prescribed for
the purposes of this Subpart.
1999 cI‑5.1 s820
Part 7
Financial Responsibility Cards
Definitions
821 In this Part,
                                (a)   “licensed
insurer� means an insurer that holds a licence authorizing the insurer to
undertake automobile insurance;
                                (b)   “non‑Alberta policyâ€? means an owner’s policy evidencing a
contract of insurance that is not made in Alberta;
                                (c)   “unlicensed insurer� means an insurer that
does not hold a licence that authorizes the insurer to undertake automobile
insurance.
1999 cI‑5.1 s821
Owner’s policy
822(1) In this section, “insured� means a person named
as the insured in an owner’s policy.
(2) Every
licensed insurer that issues an owner’s policy must at the time of issue of the
policy also issue and deliver to the insured a financial responsibility card
and, on request by that insured, any additional copies of the card required to
be provided under the regulations.
(3) Every
licensed insurer that issues an owner’s policy must provide to the insured the
information required by the regulations relating to financial responsibility
cards when the policy is being cancelled or the insured is given a notice of
renewal.
(4) When
an insured to whom a financial responsibility card has been issued pursuant to
this section ceases to be insured by the owner’s policy in respect of which the
card was issued, that person must forthwith destroy the card and every
copy of the card issued to that person.
(5) Any
insurer that has issued a financial responsibility card or an insurance agent
who represents the insurer must provide to a peace officer any information
requested concerning the cancellation or lapse of the owner’s policy with
respect to which the financial responsibility card was issued.
(6) A financial responsibility card issued pursuant
to this section must be in a form approved by the Superintendent.
1999 cI‑5.1 s822
Non-Alberta policy -
licensed insurer
823 A financial responsibility
card that is issued by a licensed insurer in respect of a non‑Alberta
policy and that is in a form approved by the Superintendent is deemed to have
been issued pursuant to this Part and may be used to indicate financial
responsibility in Alberta.
1999 cI‑5.1 s823
Non-Alberta policy -
unlicensed insurer
824(1) A financial responsibility card that is issued
by an unlicensed insurer in respect of a non‑Alberta policy is deemed to
have been issued pursuant to this Part and may be used to indicate financial
responsibility in Alberta if
                                (a)   the
card is in a form approved by the Superintendent or is otherwise acceptable to
the Superintendent, and
                                (b)   the
unlicensed insurer provides the Superintendent with a power of attorney and
undertaking that meets the requirements of the regulations.
(2) If
an unlicensed insurer has provided the Superintendent with a power of attorney
and undertaking that meets the requirements of the regulations, notice or
process in any action or proceeding in Alberta against the unlicensed insurer
or its insured arising out of an automobile accident in Alberta may be
effectually served on the insurer or the insured, or on both of them,
                                (a)   by
leaving 3 copies of the notice or process with the Superintendent, and
                                (b)   if
the unlicensed insurer is not a party to the action or proceeding, by leaving
with the Superintendent a written statement signed by the person who issued or
caused to be issued the notice or process that sets out the full name and
address of the unlicensed insurer against whose insured the action or
proceeding is taken.
(3) On
receipt of notice or process under subsection (2), the Superintendent must
forthwith mail 2 copies of it by registered mail to the unlicensed insurer at
the insurer’s address last known to the Superintendent.
(4) The
plaintiff in any action or proceeding against an unlicensed insurer that has
provided the Superintendent with an undertaking that meets the requirements of
the regulations may give evidence of the undertaking, and the undertaking is,
for all purposes of the action or proceeding, deemed to be a covenant for
valuable consideration made by the unlicensed insurer with the plaintiff.
(5) If an unlicensed insurer that has provided the
Superintendent with a power of attorney and undertaking that meets the
requirements of the regulations defaults under them, no financial
responsibility card issued by the unlicensed insurer may be accepted as proof
of financial responsibility in Alberta so long as that default continues, and
the Superintendent must forthwith notify the proper officers in charge of the
registration of automobiles and the licensing of drivers in all jurisdictions
in Canada, and in the United States of America where the financial
responsibility cards are accepted as proof of financial responsibility, of the
default.
1999 cI‑5.1 s824
Fund maintained by
corporation
825(1) In this section, “motor vehicle� means a motor
vehicle as defined in the Traffic Safety
Act.
(2) A
corporation is entitled to a financial responsibility card that is issued by
the Superintendent if
                                (a)   the
corporation is a prescribed corporation,
                                (b)   the
corporation maintains a separate fund for the purpose of satisfying from that
fund liabilities that the corporation may incur resulting from bodily injury to
or the death of any person, or damage to property, occasioned by or arising out
of the ownership, maintenance, operation or use of a motor vehicle, and
                                (c)   in
the opinion of the Superintendent, the fund is adequate to satisfy all
liabilities that the corporation is likely to incur, subject, in the case of
each motor vehicle registered in the name of the corporation, to the limits as
to amount and the accident insurance benefits specified in Part 5, Subpart 5.
(3) If
the Superintendent is satisfied that the requirements of subsection (2) are
met, the Superintendent must issue and deliver to the corporation a financial
responsibility card and, on the request of the corporation, any additional
copies of the card required by the regulations to be provided.
(4) When the fund of a corporation that has been
issued a financial responsibility card under subsection (2) ceases to meet the
requirements of subsection (2)(b) or (c), the corporation must forthwith
deliver to the Superintendent for cancellation its financial responsibility
card and all copies of the card issued to the corporation.
RSA 2000 cI‑3
s825;2003 c42 s9
Regulations
826 The Lieutenant Governor in Council may
make regulations
                                (a)   governing
any matter with respect to the issuance of and the cancellation of financial
responsibility cards;
                                (b)   respecting
the provision of copies of financial responsibility cards to an insured for the
purposes of section 822 and to a prescribed corporation for the purposes of
section 825;
                                (c)   respecting
the information that a licensed insurer must provide to an insured when the
policy is being cancelled or the insured is given a notice of renewal;
                                (d)   respecting
the power of attorney and undertaking that unlicensed insurers are to provide
for the purposes of section 824;
                                (e)   prescribing corporations for the purposes of
section 825.
1999 cI‑5.1 s826
Part 8
Transitional Provisions, Consequential Amendments, Repeals and Coming into
Force
Subpart 1
Transitional Provisions
Definitions
827 In this Subpart,
                                (a)   “continued
special Act company� means a special Act company that is continued under this
Subpart;
                                (b)   “former
Insurance Actâ€? means the Insurance Act, RSA 1980 cI‑5;
                                (c)   “special
Act company� means an insurer incorporated by a special Act of the Legislature;
                                (d)   “unlicensed
special Act company� means
                                          (i)   Altasure Insurance Company,
                                         (ii)   Innovative Insurance Corporation,
                                        (iii)   Merchants and Traders Assurance Company, or
                                        (iv)   a special Act company incorporated by a
special Act of the Legislature that was enacted after April 1, 1999 and before
this Subpart comes into force.
1999 cI‑5.1 s827
Continuation of licensed
special Act companies
828 Every special Act company that
holds a licence under the former Insurance
Act when this Subpart comes into force is continued as a provincial company
under this Act, and the Lieutenant Governor in Council must issue a certificate
of continuance for each of those companies.
1999 cI‑5.1 s828
Continuation of
unlicensed special Act companies
829(1) Despite the provisions of any special Act, an
unlicensed special Act company is dissolved one year after this Subpart comes
into force or any longer period specified by the Lieutenant Governor in Council
not exceeding one additional year unless, before the expiration of the period,
the company is continued under this section.
(2) An
unlicensed special Act company may be continued as a provincial company if the
company submits an application to the Minister that contains
                                (a)   the
information, material and evidence specified by the Minister;
                                (b)   a
plan for the future conduct and development of the business of the company;
                                (c)   its
proposed financial year.
(3) The Lieutenant Governor in Council may, on the
recommendation of the Minister, issue a certificate of continuance continuing
an unlicensed special Act company as a provincial company.
1999 cI‑5.1 s829
Certificate of
continuance
830(1) A certificate of continuance issued under this
Subpart must set out the name of the company, its financial year and whether
the company is a mutual provincial company.
(2) The Lieutenant Governor in Council may set out
in the certificate of continuance any term or condition that the Lieutenant
Governor in Council considers appropriate to deal with the particular
circumstances of the company.
1999 cI‑5.1 s830
Effect of certificate of
continuance
831(1) On the date set out in the certificate of
continuance,
                                (a)   a
continued special Act company becomes a provincial company as if it had been
incorporated under Part 2, Subpart 2, Division 1, and
                                (b)   the
certificate of continuance is the instrument of incorporation of the company.
(2) A certificate of continuance is conclusive
proof for the purposes of this Act and for all other purposes that the company
has been continued under this Act on the date set out in the certificate of
continuance.
1999 cI‑5.1 s831
Effect of continuation
832 When a special Act company is continued
under this Subpart,
                                (a)   the
property of the special Act company continues to be the property of the
provincial company,
                                (b)   the
provincial company continues to be liable for the obligations of the special
Act company,
                                (c)   an
existing cause of action or claim by or against the special Act company or any
liability to prosecution is unaffected,
                                (d)   a
civil, criminal or administrative action or proceeding pending by or against
the special Act company may continue to be prosecuted by or against the
provincial company, and
                                (e)   a conviction against, or any ruling, order
or judgment in favour of or against, the special Act company may be enforced by
or against the provincial company.
1999 cI‑5.1 s832
Application of Part 2,
Subpart 2, Division 2
833 Part 2, Subpart 2, Division 2
applies, with the necessary changes, to an unlicensed special Act company that
is continued under this Subpart.
1999 cI‑5.1 s833
Bylaws
834 A continued special Act
company must file with the Minister a copy of all of its bylaws within 6 months
of the company’s being continued.
1999 cI‑5.1 s834
Shares with nominal or
par value
835 On the continuation of a
special Act company under this Subpart, shares with a nominal or par value of
the company are deemed to be shares without nominal or par value.
1999 cI‑5.1 s835
Paid‑up capital
836 For the purposes of section
235, the amount in the capital account for each class and series of shares of a
continued special Act company is deemed to equal the paid‑up capital of
each class and series of shares of the company immediately prior to the
continuation of the company.
1999 cI‑5.1 s836
Deemed consent -
significant interest
837 If on the continuation of a
special Act company under this Subpart a person has a significant interest in
the company, the Minister is, for the purposes of section 257, deemed to have
given a consent in respect of the significant interest.
1999 cI‑5.1 s837
Voting by participating
policyholder
838 Despite section 281, the
holder of a participating policy that was issued by a continued special Act
company before the company was continued is entitled to more than one vote, or
to a fraction of a vote, at a meeting of participating policyholders or
shareholders of the company in accordance with the terms of the policy or the
provisions of the instrument of incorporation or the bylaws of the company that
were not repealed and did not otherwise cease to have effect before the
continuation of the company.
1999 cI‑5.1 s838
Appointment of directors
and officers continued
839 Despite any other provision of
this Act, the directors and officers of a special Act company that are in
office when the company is continued under this Subpart remain in office until
the first annual meeting of participating policyholders and shareholders of the
company.
1999 cI‑5.1 s839
Directors’ remuneration
840 The resolution of the
participating policyholders or shareholders of a continued special Act company
establishing the remuneration of the directors that was passed pursuant to
section 147 of the former Insurance Act
continues to have effect until the first meeting of the participating
policyholders and shareholders following the continuation of the company.
1999 cI‑5.1 s840
Participating policies
841 Despite sections 300(1) and
309(2)(c), the directors of a continued special Act company that issues participating
policies must, within 6 months after the continuation of the company, establish
a policy for determining the dividends and bonuses to be paid to the
participating policyholders.
1999 cI‑5.1 s841
Bylaws
842(1) If a bylaw of a special Act company is in
effect when the company is continued under this Subpart, the bylaw continues in
effect until amended or repealed, unless it contravenes or is inconsistent with
a provision of this Act.
(2) A
bylaw made by the directors of a special Act company under section 140 of the
former Insurance Act and not
confirmed at a general meeting of the company in accordance with section 141 of
that Act before the company is continued under this Subpart continues to have
effect, unless it contravenes or is inconsistent with the provisions of this
Act, until the first meeting of the participating policyholders and
shareholders following the continuation of the company.
(3) A
bylaw referred to in subsection (2) must be submitted to the participating
policyholders and shareholders at the first meeting of the participating
policyholders and shareholders following the continuation of the company.
(4) Sections 341(3) and (4) and 342 apply in
respect of a bylaw referred to in this section as if it were a bylaw made under
section 341.
1999 cI‑5.1 s842
Deemed bylaws
843(1) Any matter provided for in the special Act of a
special Act company that, under this Act, would be provided for in the bylaws
of a provincial company is, on the continuation of the company under this
Subpart, deemed to be provided for in the bylaws of the company.
(2) If a bylaw of the continued special Act company
made in accordance with sections 341 and 342 amends or repeals any matter
referred to in subsection (1), the bylaw prevails.
1999 cI‑5.1 s843
Auditor
844 Despite any provision in this Act, the
auditor of a continued special Act company continues to be the auditor of the
company until
                                (a)   the
company’s first annual meeting of participating policyholders and shareholders,
or
                                (b)   the
office of auditor becomes vacant,
whichever occurs first.
1999 cI‑5.1 s844
Actuary
845 Despite any provision in this
Act, the actuary of a continued special Act company continues to be the actuary
of the company.
1999 cI‑5.1 s845
Triennial solicitation
of policyholders
846 Subject to section 292(2),
section 292(1) applies in respect of a participating policy issued before the
coming into force of section 292 and requires a provincial company, within 3
years after the coming into force of section 292 and at least once every 3
years afterwards, to do the things referred to in section 292(1) in relation to
such a participating policy.
1999 cI‑5.1 s846
Continuation of licences
and certificates
847(1) The licence of an insurer under Part 2 of the
former Insurance Act is continued as
a licence under Part 1, Subpart 1 of this Act.
(2) Despite
subsection (1), the licence of a mutual benefit society that was subject to
Part 14 of the former Insurance Act
is cancelled.
(3) The
licence of a special insurance broker under the former Insurance Act is continued as a special broker’s licence under Part
1, Subpart 2 of this Act.
(4) The
licence of a reciprocal insurance exchange under Part 15 of the former Insurance Act is continued as a licence
under Part 1, Subpart 3 of this Act.
(5) The
certificate of authority of an insurance agent under Part 16 of the former Insurance Act is continued as an
insurance agent’s certificate of authority under Part 3 of this Act.
(6) The adjuster’s certificate of an adjuster under
Part 16 of the former Insurance Act
is continued as an adjuster’s certificate of authority under Part 3 of this
Act.
1999 cI‑5.1 s847
Application of section
501
848 Section 501 applies only to
refunds paid in respect of contracts of insurance entered into or renewed after
the coming into force of section 501.
1999 cI‑5.1 s848
Regulations
849 The Lieutenant Governor in Council may
make regulations
                                (a)   respecting
the transition of matters under the former Insurance
Act to this Act;
                                (b)   respecting
the continuation and licensing of special Act companies under this Act;
                                (c)   respecting
the revival of a special Act company that has not been continued under this Act
and whose special Act has been repealed under this Act, including
                                          (i)   having the revival be effective to the date that the special Act
was repealed;
                                         (ii)   the winding‑up and dissolution of a
revived special Act company.
1999 cI‑5.1 s849
Subpart 2
Consequential Amendments
850 to 870 (These sections make
consequential amendments to other Acts.Â
The amendments have been incorporated into those Acts.)
Subpart 3
Repeals
Repeal of Acts
871 The following Acts are repealed:
                                (a)   An Act to incorporate The Alberta‑Canadian
Insurance Company;
                                (b)   The Alberta Fire and Accident Insurance
Company Limited, Act;
                                (c)   An Act to incorporate The Alberta Guarantee
and Fidelity Company;
                                (d)   The Alberta Motor Association Insurance
Company Act;
                                (e)   The Alberta West Coast Insurance Corporation
Act;
                                 (f)   An Act to incorporate “Alco Mutual Hail
Insurance Company�;
                                (g)   An Act to Incorporate the Calgary Fire
Insurance Company;
                                (h)   An Act to Incorporate the Canada Security
Assurance Company;
                                 (i)   An Act to Incorporate the Canada West
Insurance Company;
                                 (j)   Canadian Health Assurance Corporation Act;
                                (k)   The Cardinal Life Insurance Company Act;
                                 (l)   The Cosmopolitan Life Assurance Company Act;
                               (m)   Fair & Millikin Insurance Company Act;
                                (n)   An Act to incorporate the Farmers’ Fire and
Hail Insurance Company;
                                (o)   An
Act entitled “50‑50 Mutual Hail
Insurance Society�;
                                (p)   The Financial Life Assurance Company Act;
                                (q)   First Canadian Insurance Corporation Act;
                                 (r)   An Act to Incorporate the Great North
Insurance Company;
                                (s)   An Act to incorporate The Home Assurance
Company of Canada;
                                 (t)   Maycroft Insurance Company Limited Act;
                                (u)   The Mennonite Mutual Relief Insurance
Company Act;
                                (v)   An Act to Incorporate the Merchants Fire
Insurance Company;
                               (w)   An Act respecting The Occidental Fire
Insurance Company;
                                (x)   Peace Hills General Insurance Company Act;
                                (y)   An Act to incorporate The Premier Insurance
Company;
                                (z)   The Professional Life Insurance Company Act;
                              (aa)   The Rocky Mountain General Insurance Company
Act;
                             (bb)   The Sterling Life Assurance Company Act;
                              (cc)   The Stockgrowers’ Insurance Company of
Canada Ltd. Act;
                             (dd)   The Summit Life Assurance Company Act;
                              (ee)   An Act to incorporate The United Assurance
Company;
                               (ff)   The United Equity Life Insurance Company Act;
                             (gg)   An Act respecting the Wawanesa Mutual
Insurance Company;
                             (hh)   An Act to Incorporate the Western Canada
Fire Insurance Company;
                                (ii)   An Act to Incorporate the Western Union
Insurance Company;
                                (jj)   The Western Union Life Insurance Company Act;
                              (kk)   An Act
to Incorporate The Windsor Insurance Company.
1999 cI‑5.1 s871
Repeal of Acts on
Proclamation
872 The following Acts are repealed on
Proclamation:
                                (a)   Altasure Insurance Company Act;
(NOTE:Â Proclaimed repealed February 1, 2006.)
                                (b)   Innovative Insurance Corporation Act;
(NOTE:Â Proclaimed repealed February 1, 2006.)
                                (c)   Insurance Act, RSA 1980 cI‑5;
(NOTE:Â Â RSA 1980 cI‑5 proclaimed repealed
September 1, 2001.)
                                (d)   An Act to incorporate the Merchants and
Traders Assurance Company;
(NOTE:Â Proclaimed repealed February 1, 2006.)
                                (e)   any special Act of the Legislature that was
enacted after April 1, 1999 and before Subpart 1 comes into force that
incorporates a special Act company.
1999 cI‑5.1 s872
Repeal of section
873 Section 413 is repealed on
Proclamation.
1999 cI‑5.1 s873
(NOTE:Â Â Section 413
proclaimed repealed November 26, 2003.)
Subpart 4
Coming into Force
Coming into force
874 This Act, except section 414,
comes into force on Proclamation.
1999 cI‑5.1 s874
(NOTE:Â Â Proclaimed
in force, except sections 414, 458(3) and (4), 465, 497, 872(a), (b), (d) and
(e) and 873, September 1, 2001. Section
873 proclaimed in force and section 413 proclaimed repealed November 26,
2003. Section 465 proclaimed in force
April 1, 2006. Section 872(a), (b) and
(d) proclaimed in force February 1, 2006.)