Insurance Companies Act
528 (1) A company may enter into a transaction with a related party of the company if the transaction
(a) subject to subsection (2), consists of a written contract for the purchase by the company of services used in the ordinary course of business;
(b) subject to subsection (4), involves the provision of services normally offered to the public by the company in the ordinary course of business;
(c) consists of a written contract with a financial institution or an entity in which the company is permitted to have a substantial investment pursuant to section 495 that is a related party of the company
(i) for the networking of any services provided by the company or the financial institution or entity, or
(ii) for the referral of any person by the company to the financial institution or entity, or for the referral of any person by the financial institution or entity to the company;
(d) consists of a written contract for such pension or benefit plans or their management or administration as are incidental to directorships or to the employment of officers or employees of the company or its subsidiaries; or
(e) involves the provision by the company of management, advisory, accounting, information processing or other services in relation to any business of the related party.
(2) Where a company has entered into a contract pursuant to paragraph (1)(a) and the contract, when taken together with all other such contracts entered into by the company, results in all or substantially all of the management functions of the company being exercised by persons who are not employees of the company, the Superintendent may, by order, if the Superintendent considers that result to be inappropriate, require the company, within such time as may be specified in the order, to take all steps necessary to ensure that management functions that are integral to the carrying on of business by the company are exercised by employees of the company to the extent specified in the order.
Marginal note:Service corporations
(3) Notwithstanding subsection 521(2), a company is deemed not to have indirectly entered into a transaction in respect of which this Part applies if the transaction is entered into by a service corporation, as defined in subsection 490(1), that is controlled by the company and the transaction is on terms and conditions at least as favourable to the company as market terms and conditions, as defined in subsection 534(2).
(4) The provision of services, for the purposes of paragraph (1)(b), does not include the making of loans or guarantees.
- 1991, c. 47, s. 528
- 1997, c. 15, s. 279
- Date modified: