Insurance Companies Act (S.C. 1991, c. 47)

Act current to 2015-11-16 and last amended on 2015-06-23. Previous Versions

Permitted Related Party Transactions

Marginal note:Nominal value transactions

 Notwithstanding anything in this Part, a company may enter into a transaction with a related party of the company if the value of the transaction is nominal or immaterial to the company when measured by criteria that have been established by the conduct review committee of the company and approved in writing by the Superintendent.

Marginal note:Reinsurance
  •  (1) A company may, subject to subsection (2) and to Division III of Part VI, cause itself to be reinsured by a related party of the company against any risk undertaken by the company under its policies.

  • Marginal note:Restriction re related parties

    (2) Except with the approval of the Superintendent, a company may cause itself to be reinsured in respect of risks undertaken under its policies by a related party of the company only if the related party is

    • (a) a company; or

    • (b) a foreign company that, in Canada, reinsures those risks.

  • Marginal note:Exception

    (3) The approval of the Superintendent under subsection (2) is not required if the reinsurance transaction was approved by the Minister or the Superintendent under subsection 254(2) or (2.01).

  • 1991, c. 47, s. 523;
  • 2007, c. 6, s. 243.
Marginal note:Risks of related party

 A company may, subject to Division III of Part VI, reinsure any risks undertaken by a related party of the company.

  • 1991, c. 47, s. 524;
  • 2007, c. 6, s. 244(F).
Marginal note:Secured loans

 A company may make a loan to or a guarantee on behalf of a related party of the company or take an assignment of or otherwise acquire a loan to a related party of the company if

  • (a) the loan or guarantee is fully secured by securities of or guaranteed by the Government of Canada or the government of a province; or

  • (b) the loan is a loan permitted by section 469 made to a related party who is a natural person on the security of a mortgage of the principal residence of that related party.

Marginal note:Borrowing, etc., from related party
  •  (1) A company may borrow money from or issue debt obligations to a related party of the company.

  • Marginal note:Segregated funds

    (2) A company may issue policies to a related party of the company or 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 policies or the amounts accepted or retained vary in amount depending on the market value of a specified group of assets.