O. Reg. 124/08: Reciprocal Insurance Exchanges

 

ontario regulation 124/08

made under the

Insurance Act

Made: April 30, 2008
Filed: May 2, 2008
Published on e-Laws: May 5, 2008
Printed in The Ontario Gazette: May 17, 2008

Amending O. Reg. 637/00

(Reciprocal Insurance Exchanges)

1. Ontario Regulation 637/00 is amended by adding the following section:

0.1 (1) For the purposes of clause 380.1 (d) of the Act and subject to subsection (2), an agreement referred to in section 380.1 of the Act between subscribers to a reciprocal insurance exchange must contain the following requirements:

1. The advisory board of the exchange shall appoint an audit committee from among the members of the advisory board.

2. The advisory board of the exchange shall authorize and direct the audit committee,

i. to exercise the powers and perform the duties described in subsections 3 (5), (6), (7) and (9) of Ontario Regulation 123/08 (Corporate Governance — Part II.2 of the Act) made under the Act, and

ii. to notify the exchange’s auditor of every meeting of the committee and invite the auditor, at the exchange’s expense, to attend and be heard at the meeting.

(2) If an agreement between subscribers to a reciprocal insurance exchange was entered into before the day this section comes into force and provides for the appointment of such committees as the Superintendent may require, subsection (1) does not apply to the agreement on or before the effective date of the first amendment that is made to the agreement for any reason after the day this section comes into force.

2. (1) Paragraphs 3 and 4 of section 1 of the Regulation are revoked and the following substituted:

3. A copy of the agreement between the subscribers that is referred to in section 380.1 of the Act.

3.1 A copy of the form of the contract or contracts of indemnity or insurance to be effected or exchanged.

4. A copy of the form of power of attorney under which reciprocal contracts of indemnity or insurance are executed on behalf of the exchange’s members by a person other than a member.

(2) Paragraph 8 of section 1 of the Regulation is revoked and the following substituted:

8. Evidence satisfactory to the Superintendent that the management of the affairs of the exchange is subject to the supervision of an advisory board in accordance with the terms of the agreement referred to in section 380.1 of the Act.

3. (1) Paragraph 6 of section 2 of the Regulation is revoked and the following substituted:

6. The management of the affairs of the exchange must be subject to the supervision of the advisory board in accordance with the terms of the agreement referred to in section 380.1 of the Act.

(2) Section 2 of the Regulation is amended by adding the following paragraph:

7. The agreement between the subscribers complies with the requirements of section 380.1 of the Act and section 0.1 of this Regulation.

4. Section 3 of the Regulation is revoked and the following substituted:

3. (1) The minimum amount that must be maintained under subsection 386 (1) of the Act is the amount of cash or investments equal to 50 per cent of the net written premiums reported in the most recent statement delivered by the exchange under clause 102 (1) (a) of the Act.

(2) In determining the amount of cash and investments referred to in subsection (1), only the following shall be included:

1. If the exchange has its principal office in Ontario, the value of only investments that the exchange is authorized to make under section 387 of the Act shall be included.

2. If the exchange has its principal office in a province or territory of Canada other than Ontario, the value of only investments that the exchange is authorized to make under the laws of the jurisdiction in which the principal office is located shall be included.

3. If the exchange has its head office outside Canada, the value of only investments that the exchange is authorized to make under Part XIII of the Insurance Companies Act (Canada) shall be included.

5. This Regulation comes into force on the later of the day subsection 6 (4) of Schedule O to the Budget Measures Act, 2006 (No. 2) comes into force and the day this Regulation is filed.