Assets (Foreign Companies) Regulations

7 (1) Where a foreign company is reinsured in whole or in part against risks undertaken or claims payable in respect of a policy in Canada or group of policies in Canada, the aggregate of the amounts referred to in paragraphs 3(a) to (c) or 4(a) and (b) or 5(a) and (b) may be reduced by subtracting from that amount an amount not exceeding the aggregate of the portions of that amount that apply to the portion of the risks or claims that is reinsured.

(2) Where a reinsurer is incorporated by or under an Act of the legislature of a province and is not a provincial company, a reduction under subsection (1) may only be made where the Superintendent has, by order, determined that the financial condition of the reinsurer is satisfactory and that its operations are conducted in accordance with sound business and financial practices.

(3) Where a reinsurer is not authorized under the Act to insure risks and is incorporated elsewhere than in Canada, a reduction under subsection (1) may be made only to the extent that security is maintained in Canada, in respect of the potential liabilities of the reinsurer, in an amount, of a nature and under arrangements that are determined by the Superintendent to be satisfactory.