Insurance Companies Act

Marginal note:Non-application of Part

• 519 (1) This Part does not apply in respect of any transaction entered into prior to the coming into force of this Part but, after the coming into force of this Part, any modification of, addition to, or renewal or extension of a prior transaction is subject to this Part.

• Marginal note:Idem

  (2) This Part does not apply in respect of

  • (a) assets of a segregated fund maintained pursuant to section 451 if

    • (i) all the policies in respect of which the fund is maintained are held by one person or all the amounts in respect of which it is maintained are retained on the direction of one person, or

    • (ii) the assets of the fund reflect the securities upon which a generally recognized market index is based and the weighting of those securities in that index;

  • (b) the issue by the 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 company under Part III,

    • (iv) in accordance with the terms of an amalgamation under Part VI,

    • (v) by way of consideration in accordance with the terms of a sale agreement under Part VI, or

    • (vi) with the approval in writing of the Superintendent, in exchange for shares of another body corporate;

  • (c) the payment of dividends or policy dividends or bonuses by a company;

  • (d) transactions that consist of the payment or provision by a company to persons who are related parties of the company of salaries, fees, stock options, policy premiums, pension benefits, incentive benefits or other benefits or remuneration in their capacity as directors, officers or employees of the company;

  • (e) transactions approved by the Minister under subsection 715(1) of this Act or subsection 678(1) of the Bank Act; or

  • (f) if a company is controlled by a widely held insurance holding company or a widely held bank holding company, transactions approved by the Superintendent that are entered as part of, or in the course of, a restructuring of the holding company or of any entity controlled by it.

• Marginal note:Exception

  (3) Nothing in paragraph (2)(d) exempts from the application of this Part the payment by a company of fees or other remuneration to a person for

  • (a) the provision of services referred to in paragraph 528(1)(a); or

  • (b) duties outside the ordinary course of business of the company.

• Marginal note:Exception for holding body corporate

  (4) A holding body corporate of a company is not a related party of the company if the holding body corporate is a Canadian financial institution that is referred to in any of paragraphs (a) to (d) of the definition financial institution in subsection 2(1).

• Marginal note:Substantial investment — related party exception

  (5) Where a holding body corporate of a company is, because of subsection (4), not a related party of the company, any entity in which the holding body corporate has a substantial investment is not a related party of the company if no related party of the company has a substantial investment in the entity otherwise than through the control of the holding body corporate.