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Insurance Business (Authorized Foreign Banks) Regulations (SOR/99-270)

Regulations are current to 2020-01-27 and last amended on 2012-03-01. Previous Versions

Insurance Business (Authorized Foreign Banks) Regulations

SOR/99-270

BANK ACT

Registration 1999-06-23

Insurance Business (Authorized Foreign Banks) Regulations

P.C. 1999-1156 1999-06-23

His Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to section 549Footnote a of the Bank ActFootnote b, hereby makes the annexed Insurance Business (Authorized Foreign Banks) Regulations.

Interpretation

 The definitions in this section apply in these Regulations.

Act

Act means the Bank Act. (Loi)

authorized type of insurance

authorized type of insurance means

  • (a) credit or charge card-related insurance;

  • (b) creditors’ disability insurance;

  • (c) creditors’ life insurance;

  • (d) creditors’ loss of employment insurance;

  • (e) creditors’ vehicle inventory insurance;

  • (f) export credit insurance;

  • (g) mortgage insurance; or

  • (h) travel insurance. (assurance autorisée)

bank web page

bank web page means a web page that an authorized foreign bank uses in relation to its business in Canada, including any information provided by the authorized foreign bank that is accessible on a telecommunications device. It does not include a web page that is only accessible by employees or agents of the authorized foreign bank. (page Web de banque)

credit or charge card-related insurance

credit or charge card-related insurance, in respect of an authorized foreign bank, means a policy of an insurance company that provides insurance to the holder of a credit or charge card issued by the authorized foreign bank as a feature of the card, without request and without an individual assessment of risk,

  • (a) against loss of, or damage to, goods purchased with the card;

  • (b) under which the insurance company undertakes to extend a warranty provided by the manufacturer of goods purchased with the card; or

  • (c) against any loss arising from a contractual liability assumed by the holder when renting a vehicle, when the rental is paid for with the card. (assurance carte de crédit ou de paiement)

creditors’ disability insurance

creditors’ disability insurance, in respect of an authorized foreign bank, means a group insurance policy that will pay all or part of the amount of a debt of a debtor to the authorized foreign bank, in the event of bodily injury to, or an illness or disability of,

  • (a) where the debtor is a natural person, the debtor or the spouse or common-law partner of the debtor;

  • (b) a natural person who is a guarantor of all or part of the debt;

  • (c) where the debtor is a body corporate, any director or officer of the body corporate; or

  • (d) where the debtor is an entity, any natural person who is essential to the ability of the debtor to meet the debtor’s financial obligations to the authorized foreign bank. (assurance-invalidité de crédit)

creditors’ life insurance

creditors’ life insurance, in respect of an authorized foreign bank, means a group insurance policy that will pay to the authorized foreign bank all or part of the amount of a debt of a debtor or, where a debt is in respect of a small business or a farm, fishery or ranch, all or part of the amount of the credit limit of a line of credit, in the event of the death of

  • (a) where the debtor is a natural person, the debtor or the spouse or common-law partner of the debtor;

  • (b) a natural person who is a guarantor of all or part of the debt;

  • (c) where the debtor is a body corporate, a director or officer of the body corporate; or

  • (d) where the debtor is an entity, any natural person who is essential to the ability of the debtor to meet the debtor’s financial obligations to the authorized foreign bank. (assurance-vie de crédit)

creditors’ loss of employment insurance

creditors’ loss of employment insurance, in respect of an authorized foreign bank, means a policy of an insurance company that will pay, without any individual assessment of risk, all or part of the amount of a debt of a debtor to the authorized foreign bank, in the event that

  • (a) the debtor, if the debtor is a natural person, becomes involuntarily unemployed; or

  • (b) a natural person who is a guarantor of all or part of the debt becomes involuntarily unemployed. (assurance crédit en cas de perte d’emploi)

creditors’ vehicle inventory insurance

creditors’ vehicle inventory insurance, in respect of an authorized foreign bank, means a policy of an insurance company that provides insurance against direct and accidental loss or damage to vehicles that are held in stock for display and sale purposes by a debtor of the authorized foreign bank, some or all of which have been financed by the authorized foreign bank; (assurance crédit pour stocks de véhicules)

export credit insurance

export credit insurance means a policy of an insurance company that provides insurance to an exporter of goods or services against a loss incurred by the exporter due to a non-payment for exported goods or services. (assurance crédit des exportateurs)

group insurance policy

group insurance policy, in respect of an authorized foreign bank, means a contract of insurance between an insurance company and the authorized foreign bank that provides insurance severally in respect of a group of identifiable persons who individually hold certificates of insurance. (police d’assurance collective)

insurance company

insurance company means an entity that is approved, registered or otherwise authorized to insure risks under an Act of Parliament or of the legislature of a province. (société d’assurances)

line of credit

line of credit means a commitment on the part of an authorized foreign bank to lend to a debtor, without a predetermined repayment schedule, one or more amounts, where the aggregate amount outstanding does not exceed a predetermined credit limit, which limit does not exceed the reasonable credit needs of the debtor. (marge de crédit)

mortgage insurance

mortgage insurance, in respect of an authorized foreign bank, means an insurance policy that provides insurance to the authorized foreign bank against loss caused by a default on the part of a debtor who is a natural person under a loan from the authorized foreign bank that is secured by a mortgage on real property or on an interest in real property. (assurance hypothèque)

personal accident insurance

personal accident insurance means a group insurance policy that provides insurance to a natural person

  • (a) whereby the insurance company undertakes to pay one or more sums of money in the event of bodily injury to, or the death of, the person that is caused by an accident; or

  • (b) whereby the insurance company undertakes to pay a certain sum for each day that the person is hospitalized in the event of bodily injury to the person that is caused by an accident or in the event of an illness or disability of the person. (assurance accidents corporels)

small business

small business means a business that is or, if it were incorporated, would be a small business corporation within the meaning of subsection 248(1) of the Income Tax Act. (petite entreprise)

travel insurance

travel insurance means

  • (a) a policy of an insurance company that provides insurance to a natural person in respect of a trip by the person away from the place where the person ordinarily resides, without any individual assessment of risk, against

    • (i) loss that results from the cancellation or interruption of the trip,

    • (ii) loss of, or damage to, personal property that occurs while on the trip, or

    • (iii) loss that is caused by the delayed arrival of personal baggage while on the trip; or

  • (b) a group insurance policy that provides insurance to a natural person in respect of a trip by the person away from the province in which the person ordinarily resides

    • (i) against expenses incurred while on the trip that result from an illness or the disability of the person that occurs on the trip,

    • (ii) against expenses incurred while on the trip that result from bodily injury to, or the death of, the person caused by an accident while on the trip,

    • (iii) whereby the insurance company undertakes to pay one or more sums of money in the event of an illness or the disability of the person that occurs on the trip, or of bodily injury to, or the death of, the person that is caused by an accident while on the trip,

    • (iv) against expenses incurred by the person for dental care necessitated by an accident while on the trip, or

    • (v) in the event that the person dies while on the trip, against expenses incurred for the return of that person’s remains to the place where the person was ordinarily resident before death, or for travel expenses incurred by a relative of that person who must travel to identify that person’s remains. (assurance voyage)

  • SOR/2001-189, s. 1
  • SOR/2002-268, s. 1
  • SOR/2011-184, s. 1

 For the purposes of these Regulations, a web page is not a bank web page by reason only that the web page provides access to a bank web page or promotes the business of an authorized foreign bank in Canada.

  • SOR/2011-184, s. 2

Permitted Activities

  •  (1) An authorized foreign bank may administer an authorized type of insurance and personal accident insurance.

  • (2) An authorized foreign bank may administer a group insurance policy for

    • (a) its employees or the employees of an entity that it holds control of, or a substantial investment in, under section 522.07 or 522.08 or subsection 522.32(1) or (3) of the Act;

    • (b) the employees of an entity that an affiliate of the authorized foreign bank holds control of, or a substantial investment in, under section 522.07 or 522.08 or subsection 522.32(1) or (3) of the Act; and

    • (c) the employees in Canada of an affiliate of the authorized foreign bank that is an entity referred to in section 522.17 or 522.18 of the Act and that carries on a business described in one of those sections.

  • SOR/2002-268, s. 2
  •  (1) An authorized foreign bank may provide advice regarding an authorized type of insurance or a service in respect of an authorized type of insurance.

  • (2) An authorized foreign bank may provide advice in respect of an insurance policy that is not of an authorized type of insurance, or services in respect thereof, if

    • (a) the advice is general in nature;

    • (b) the advice is not in respect of

      • (i) a specific risk, proposal in respect of life insurance, insurance policy or service, or

      • (ii) a particular insurance company, agent or broker; and

    • (c) the authorized foreign bank does not thereby refer any person to a particular insurance company, agent or broker.

Promotion

 An authorized foreign bank shall not, in relation to its business in Canada, promote an insurance company, agent or broker unless

  • (a) the company, agent or broker deals only in authorized types of insurance; or

  • (b) the promotion takes place outside a branch of the authorized foreign bank and is directed to

    • (i) all the holders of credit or charge cards issued by the authorized foreign bank who regularly receive statements of account or notices of those statements,

    • (ii) all the authorized foreign bank’s customers who are natural persons and who regularly receive statements of account or notices of those statements, or

    • (iii) the general public.

  • SOR/2011-184, s. 3
  •  (1) An authorized foreign bank shall not, in relation to its business in Canada, promote an insurance policy of an insurance company, agent or broker, or a service in respect of such a policy, unless

    • (a) the policy is of an authorized type of insurance or the service is in respect of such a policy;

    • (b) the policy is to be provided by a corporation without share capital, other than a mutual insurance company or a fraternal benefit society, that carries on business without pecuniary gain to its members and the policy provides insurance to a natural person in respect of the risks covered by travel insurance;

    • (c) the policy is a personal accident insurance policy and the promotion takes place outside a branch of the authorized foreign bank;

    • (d) the service is in respect of a policy referred to in paragraph (b) or of a policy referred to in paragraph (c) that is promoted as described in that paragraph; or

    • (e) the promotion takes place outside a branch of the authorized foreign bank and is directed to

      • (i) all the holders of credit or charge cards issued by the authorized foreign bank who regularly receive statements of account or notices of those statements,

      • (ii) all the authorized foreign bank’s customers who are natural persons and who regularly receive statements of account or notices of those statements, or

      • (iii) the general public.

  • (2) Notwithstanding subsection (1) and section 4, an authorized foreign bank may exclude from a promotion referred to in paragraph (1)(e) or 4(b) persons

    • (a) in respect of whom the promotion would contravene an Act of Parliament or of the legislature of a province;

    • (b) who have notified the authorized foreign bank in writing that they do not wish to receive promotional material from the authorized foreign bank; or

    • (c) who are holders of a credit or charge card that was issued by the authorized foreign bank and in respect of which the account is not in good standing.

  • SOR/2011-184, s. 4

Web Promotion

  •  (1) The promotion referred to in paragraph 4(b) may take place on a bank web page if it relates to an insurance company, agent or broker that deals only in authorized types of insurance and the promotion referred to in paragraph 5(1)(c) or (e) may take place on a bank web page if it relates to only an authorized type of insurance.

  • (2) However, an authorized foreign bank shall not, on a bank web page, provide access to a web page — directly or through another web page — through which there is promotion of

    • (a) an insurance company, agent or broker that does not deal only in authorized types of insurance; or

    • (b) an insurance policy of an insurance company, agent or broker, or a service in respect of such a policy, that is not of only an authorized type of insurance.

  • SOR/2011-184, s. 5

Prohibited Activities

  •  (1) No authorized foreign bank shall

    • (a) provide, directly or indirectly, an insurance company, agent or broker with any information respecting

      • (i) a customer of the authorized foreign bank in Canada,

      • (ii) an employee of a customer of the authorized foreign bank in Canada,

      • (iii) where a customer of the authorized foreign bank is an entity with members in Canada, any such member, or

      • (iv) where a customer of the authorized foreign bank is a partnership with partners in Canada, any such partner;

    • (b) permit any of its subsidiaries to provide, directly or indirectly, an insurance company, agent or broker with any information that it receives from the authorized foreign bank respecting

      • (i) a customer of the authorized foreign bank in Canada,

      • (ii) an employee of a customer of the authorized foreign bank in Canada,

      • (iii) where a customer of the authorized foreign bank is an entity with members in Canada, any such member, or

      • (iv) where a customer of the authorized foreign bank is a partnership with partners in Canada, any such partner;

    • (b.1) provide an affiliate of the authorized foreign bank that is not a subsidiary of the authorized foreign bank with information unless the authorized foreign bank ensures that the affiliate does not directly or indirectly provide the information to an insurance company, agent or broker if the information is in respect of

      • (i) a customer of the authorized foreign bank in Canada,

      • (ii) an employee of a customer of the authorized foreign bank in Canada,

      • (iii) where a customer of the authorized foreign bank is an entity with members in Canada, any such member,

      • (iv) where a customer of the authorized foreign bank is a partnership with partners in Canada, any such partner; or

    • (c) permit a subsidiary of the authorized foreign bank that is a trust or loan corporation incorporated by or under an Act of the legislature of a province to provide, directly or indirectly, an insurance company, agent or broker with any information respecting

      • (i) a customer of the subsidiary in Canada,

      • (ii) an employee of a customer of the subsidiary in Canada,

      • (iii) where a customer of the subsidiary is an entity with members in Canada, any such member, or

      • (iv) where a customer of the subsidiary is a partnership with partners in Canada, any such partner.

  • (2) Subsection (1) does not apply in respect of an authorized foreign bank or a subsidiary of an authorized foreign bank that is a trust or loan corporation incorporated by or under an Act of the legislature of a province where

    • (a) the authorized foreign bank or the subsidiary has established procedures to ensure that the information referred to in that subsection will not be used by an insurance company, agent or broker to promote in Canada the insurance company, agent or broker or to promote in Canada an insurance policy, or a service in respect thereof; and

    • (b) the insurance company, agent or broker, as the case may be, has given an undertaking to the authorized foreign bank or to the subsidiary, in a form acceptable to the Superintendent, that that information will not be used to promote in Canada the insurance company, agent or broker or to promote in Canada an insurance policy, or a service in respect thereof.

  • SOR/2002-268, s. 3

 No authorized foreign bank shall provide a telecommunications device that is primarily for the use of customers in Canada and that links a customer with an insurance company, agent or broker.

 An authorized foreign bank shall not carry on business in Canada on premises that are adjacent to the premises of an insurance company, agent or broker unless the authorized foreign bank clearly indicates to its customers that its business and the premises on which its business is carried on are separate and distinct from those of the insurance company, agent or broker.

  • SOR/2011-184, s. 6

Coming into Force

 These Regulations come into force on June 28, 1999.

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