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INSURANCE ACT
Chapter I‑3
Table of Contents
Interpretation
1 Definitions
2 Adjuster
3 Affiliate
4 Beneficial ownership
5 Control
6 Holding body corporate
7 Ordinarily resident in Canada
8 Significant interest
9 Subsidiary
10 Substantial investment
11 Incorporated
12 Contracts made in Alberta
Application
13 Mutual benefit societies
14 Benefits provided under authority of federal Act
15 Benefit plans for medical care, accident and sickness benefits
15.1 Employee benefit schemes for income replacement
16 Regulations
Crown Immunity
16.1 Crown immunity
Part 1
Licensing of Insurers and Reciprocal
Insurance Exchanges
Subpart 1
Licensing of Insurers
Insurer’s Duty to be Licensed
17 Undertaking insurance and carrying on business
18 Requirement for licence
Licensing Requirements
19 Types of insurers
20 Application requirements
21 Names
23 First licence of provincial company
24 Ability to carry on class of insurance
25 Base capital
26 Compliance with market conduct laws
27 Issuing licence
28 Notice of licence
29 Expiry
30 Renewal of licence
31 Duty on expiration of licence
32 Terms and conditions
33 Automobile insurance
Classes of Insurance
34 Classes of insurance
35 Restriction on classes of insurance
36 Prohibited activities
37 Scope of fire insurance licence
38 Life insurance
Attorney for Service
39 Attorney for service
40 Attorney’s change of address
41 Change in attorney
42 No attorney for service
Reporting Requirements
43 Annual financial statements
44 Annual return
45 Change in officials
46 Report on business particulars
47 Records to be filed
48 Audit of records
49 Other information — licensed insurers
50 Additional information
Suspension,
Cancellation and Other Actions
Affecting Insurers’ Licences
51 Federally authorized companies
52 Extra‑provincial companies
53 Cancellation on request
54 Sanctions affecting licences
55 Non‑payment of claims
56 Effect of cancellation or suspension
57 Provisional liquidator
58 Remuneration of provisional liquidator
Municipal Licensing Fees
59 Exemption from certain fees
Regulations
60 Regulations
Subpart 2
Exceptions
Unsolicited Insurance
61 Unsolicited insurance
Reinsurance
62 Reinsurance
Special Brokers
63 Insurance through special broker
64 Certificate of authority
65 Financial guarantee
66 Application for special broker’s licence
67 Issuing certificates
68 Terms and conditions
69 Expiration
70 Status of certificate of authority
71 Reporting requirements
72 Payments in respect of premiums
73 Records
74 Financial guarantee not in force
75 Using different names
76 Release of financial guarantee
Regulations
77 Regulations
Subpart 3
Licensing of Reciprocal Insurance Exchanges
78 Definitions
79 Licence required
80 Exception
81 Classes of insurance
82 Automobile insurance
83 Fire insurance
84 Application for licence
85 Name of exchange
86 Issuing licence
87 Notice of licence
88 Premium deposit
89 Management of exchange
90 Term of licence
91 Annual return
92 Signing contracts
93 Court action
94 Attorney for service
95 Attorney’s change of address
96 Change in attorney for service
97 No attorney for service
98 Requirements for fire insurance
99 Amount of reserve
99.1 Temporary exclusion from premium calculation
100 Guarantee fund
101 Deficiency
102 Investments
103 Contracts
104 Reinsurance
105 Suspension or cancellation of licence
106 Regulations
Part 2
Provincial Companies
Subpart
1
Status and Powers of Provincial Companies
107 Capacity of provincial company
108 Constructive notice
109 Authority of directors, officers and agents
110 Main business
111 Networking
112 Life insurance
113 Security interests
114 Beneficial interests
115 Debt obligations
116 Guarantees
Segregated Funds
117 Segregated funds restricted to life companies
118 Where segregated funds required
119 Creation and maintenance of segregated funds
120 Transfers from segregated funds
121 Claims against segregated funds
122 Restriction of claims
Regulations
123 Regulations
Subpart
2
Incorporation, Fundamental Changes
and Dissolution of Provincial Companies
124 Alberta insurers
Division 1
Incorporation
125 Application
126 Factors to be considered
127 Incorporation
128 Contents of certificate of incorporation
129 Notice of incorporation
130 First directors
131 Effective date of incorporation
Division 2
Organization and Commencement after Incorporation
132 First directors’ meeting
133 Calling shareholders’ meeting
134 Term of first directors
135 Carrying on of business
136 Expenses charged to capital
137 No payments until licensed
138 Deposits and investments
139 Time limit to acquire licence
140 Allowed disbursements
Division 3
Continuance into Alberta
141 Restriction on continuance
142 Continuance from another jurisdiction
143 Certificate of continuance
144 Effect of certificate of continuance
145 Notice of continuance
146 Effects of continuance
Division 4
Continuance out of Alberta
147 Continuance in another jurisdiction
148 Requirements for other jurisdiction’s law
149 Abandoning application
150 Certificate of discontinuance
Division 5
Mutualization
151 Conversion into mutual provincial company
152 Regulations
153 Payment
Division 6
Demutualization
154 Conversion into provincial company with common shares
155 Regulations
Division 7
Change of Name, Financial Year and Terms and Conditions
156 Change of name and financial year
157 Changing terms and conditions
158 Proposal to amend
Division 8
Amalgamation
159 Amalgamation
160 Amalgamation agreement
161 Minister’s approval
162 Regulations
163 Policyholder and shareholder approval
164 Joint application to Minister
165 Certificate of amalgamation
166 Effect of certificate
167 Transitional
168 Notice to other jurisdiction
Division 9
Provincial Company Amalgamating Under the
Laws of Another Jurisdiction
169 Amalgamation agreement
170 Notice of intention
171 Participating policyholder and shareholder approval
172 Abandoning voting agreement
173 Application to Minister
174 Certificate of discontinuance
Division 10
Transfer of Business and Fundamental Reinsurance
175 Interpretation
176 Notice of intention
177 Participating policyholder and shareholder approval
178 Abandoning agreement
179 Application to Minister
180 Federal and extra‑provincial companies
Division 11
Dissolution and Revival
181 Application
182 Insolvent provincial companies
183 Returns to Minister
Simple Dissolution
184 No property and no liabilities
185 Property and liabilities
186 Application
187 Approval of Minister required
188 Certificate of dissolution
Court Supervised Liquidation
189 Court supervision — voluntary liquidation
190 Court supervision — involuntary liquidation
191 Application by provisional liquidator
192 Effect of Court supervision
193 Powers of Court
194 Cessation of business and powers
195 Vacancy in liquidator’s office
196 Duties and powers of liquidator
197 Reliance on statements
198 Examination of others
199 Costs of liquidation
200 Final accounts
201 Right to distribution of money
202 Final order
203 Certificate of dissolution
General
204 Continuation of actions
205 Limitations on liability
206 Where creditor cannot be found
207 Custody of records after dissolution
Revival
208 Revival
Division 12
Dissolution and Revival of Mutual Provincial Companies
209 Insolvent mutual provincial companies
210 Regulations
Division 13
General
211 Names
212 Regulations
213 Use of “insurance” in names
214 Rights preserved
215 Effective date of certificates
Subpart
3
Head Office, Records and Financial Statements
216 Head office
217 Records
218 Access to records
219 Standards of financial reporting
220 Approval of annual financial statements
221 Distribution of financial statements
222 List of shareholders
223 Use of list
224 Dealing in lists
225 Information to be given to Minister by provincial companies
226 Records as evidence
227 Certificate of company as evidence
228 Notices to policyholders, shareholders, directors
Subpart
4
Capital Structure
229 Definition
230 Application of Business Corporations Act
Requirements for Shares
231 Non‑par‑value shares
232 Classes of shares
233 Mutual provincial companies — shares
234 Issue of shares
235 Capital account
236 Shares in series
237 Shareholder’s pre‑emptive right
Changes to Shares
238 Changing shares
239 Class vote
240 Proposal to amend
241 Restriction on subordinated indebtedness
Other Matters
242 Conversion privileges, options and rights
243 Prohibited shareholdings
244 Restrictions on acquisition of shares
245 Acquisition of own shares
246 Alternative acquisition of own shares
247 Redemption of shares
248 Donated and escrowed shares
249 Reduction of share capital
250 Adjustment of capital account
251 Enforceability of contract to purchase shares
252 Commission on sale of shares
253 Payment of dividend
254 Lien on share
255 Restrictions on issue, transfer
256 Interpretation
257 Constraints on ownership
258 Previous approval obtained
259 Shares to underwriter
260 Exception for small holdings
261 Increasing large holdings
262 Minister’s approval
263 Minister’s right to information
264 Exemption
265 Bylaws re shareholder information
266 Reliance on information
Subpart 5
Participating Policyholders and Shareholders
Division 1
Meetings and Voting
267 Place of meetings
268 Calling meetings
269 Record date
270 Notice of meeting
271 Notice of adjourned meeting
272 Special business
273 Waiver of notice
274 Policyholder and shareholder proposals
275 Refusal of proposal
276 Policyholder and shareholder lists
277 Quorum
278 One shareholder meeting
279 Meeting by electronic means
280 One share — one vote
281 One participating policyholder — one vote
282 Changing policyholders’ right to vote
283 Proposal to amend
284 Representative participating policyholder or shareholder
285 Joint voting policyholders or shareholders
286 Voting by hands or ballot
287 Resolution instead of meeting
288 Requisitioned meetings
289 Meeting called by Court
290 Disputed elections and appointments
291 Notice to Minister
292 Triennial solicitation of policyholders
Take‑over Bids — — Compulsory Purchase
293 Application of Business Corporations Act
Participating Policies and Dividends
294 Participating Account
295 Allocation of income
296 Allocation of expenses
297 Filing of allocation method
298 Review of allocation method
299 Regulations
300 Declaration of policy dividend or bonus
Division 2
Proxies and Proxy Solicitation
301 Definitions
302 Appointing proxyholder
303 Deposit of proxies
304 Mandatory solicitation
305 Soliciting proxies
306 Attendance at meeting
307 Duty of registrant
308 Restraining order
Subpart 6
Directors and Officers
Duties
309 Duty to manage
310 Duty of care
Qualifications and Number of Directors
311 Minimum number of directors
312 Disqualified persons
313 No requirement to hold shares or policies
314 Affiliated directors
Election and Tenure of Directors
315 Number of directors
316 Changing number of directors
317 Proposal to amend
318 Term of directors
319 Determining election of directors
320 Cumulative voting
321 Class or series of shares
322 Re‑election of directors
Incomplete Elections and Director Vacancies
323 Void election or appointment
324 Ceasing to hold office
325 Removal of director
326 Statement of director
327 Circulation of statement
328 Shareholders or policyholders filling vacancy
329 Directors filling vacancy
330 Vacancy among shareholders’ or policyholders’ directors
331 Class vacancy
332 Unexpired term
Meetings of the Board
333 Meeting of directors
334 Notice of meeting
335 Quorum
336 Resident Canadian majority
337 Electronic meeting
338 Resolution instead of meeting
339 Dissent of director
340 Meeting required by Minister
Bylaws
341 Bylaws
342 Policyholder or shareholder proposal of bylaw
343 Minister to receive bylaws
344 Entitlement to copies of bylaws
Committees of the Board
345 Committees
346 Audit committee
347 Conduct review committee
Authority of Directors and Officers
348 Chief executive officer
349 Appointment of officers
350 Delegation
351 Remuneration
352 Validity of acts
353 Right to attend meetings
Conflicts of Interest
354 Disclosure of interest
355 Voting
356 Continuing disclosure
357 Avoidance standards
358 Application to Court
Liability and Indemnification
359 Liability for incorporation expenses
360 Liability for other matters
361 Contribution
362 Limitation
363 Liability for wages
364 Reliance on statement
365 Indemnification of directors and officers
366 Directors’ and officers’ insurance
367 Application to Court for indemnification
Subpart
7
Insider Trading
368 Interpretation
369 Application
370 Civil liability
Subpart
8
Auditors
371 Definition
372 Appointment of auditor
373 Designated individual
374 Qualifications of auditor
375 Revocation of auditor’s appointment
376 Declaration of vacancy by Court
377 Ceasing to hold office
378 Filling vacancy
379 Statement of auditor
380 Duty of replacement auditor
381 Right to attend meetings
382 Right to information
383 Auditor’s report
384 Requiring new financial statements
385 Report on director’s statement
386 Report to officers
387 Auditor of subsidiaries
388 Calling meeting
389 Notice of errors
390 Auditor’s report and extended examination
391 Protection from liability
Subpart
9
Actuaries
392 Definition
393 Notice of appointment
394 Designated individual
395 Qualifications of actuary
396 Certain officers precluded
397 Chief financial officer
398 Revocation of actuary’s appointment
399 Declaration of vacancy by Court
400 Ceasing to hold office
401 Filling vacancy
402 Statement of actuary
403 Duty of replacement actuary
404 Right to information
405 Actuary’s valuation
406 Special valuation
407 Actuary’s report
408 Report to directors
409 Report on matters requiring rectification
410 Actuary’s procedures
411 Protection from liability
412 Regulations
Subpart
10
Adequacy of Assets, Capital and Liquidity
414 Capital and liquidity
Subpart
11
Investments
415 Definitions
416 Prudent investment standards
417 Policies and procedures
418 Prohibited investments
419 Restriction on residential mortgages
420 Limitation on ownership of unincorporated body
421 Limitation on shareholding
422 Duty to provide information
423 Divestment order
Portfolio Limits
424 Exclusion from portfolio limits
425 Lending limit — life companies
426 Lending limit — property and casualty companies
427 Limit on real property interest
428 Limits on equity acquisitions
429 Aggregate limit
430 Assets transactions
431 Retaining investments
432 Regulations
Subpart
12
Transactions with Related Parties
433 Interpretation
434 Meaning of related party
435 Designated related party
436 Transactions contemplating related party status
437 Prohibited transactions, guarantees and investments
438 Exceptions to the prohibition
439 Permitted transactions
440 Transactions requiring directors’ approval
441 Procedures for approvals by directors
442 Disclosure
443 Transactions requiring Ministerial approval
444 Limits on permitted transactions
445 Review and approval procedures
446 Duty to report contraventions
447 Reliance on information
448 Onus of proof
448.1 Personal information
449 Applications to Court
450 Regulations
Part 3
Insurance Agents and Adjusters
451 Definitions
Insurance Agents
452 Insurance agent’s certificate
453 Exception
454 Restricted insurance agent’s certificate
455 Representation
456 Designated representative for businesses
457 Restricted certificate holders — designated individual
458 Recommendations —life insurance
459 Recommendations — property and casualty insurance
Adjusters
459.1 Insurer’s liability for employee
460 Adjuster’s certificate
462 Representation
463 Designated representative for businesses
464 Recommendation
Certificates of Authority
465 Financial guarantee
466 Names
467 Application for certificate
468 Refusing certificates — general grounds
469 Issuing certificates
470 Terms and conditions
471 Expiration
472 Reinstating certificates
473 Ceasing to be worker
474 Changes in designated representative
475 Cancellation of recommendation by insurer — businesses
476 Cancellation of recommendation by designated representative
477 Cancellation of recommendation by insurer — employees
478 Financial guarantee not in force
479 Notice of automatic suspension
480 Sanctions affecting certificates
480.1 Minister’s order
481 Demand for information
482 Appeal
482.1 Evidentiary provisions
483 Consequence of revocation
484 Exemption from municipal licence fee
Duties and Prohibitions
485 Screening procedures
486 Knowledgeable personnel
487 Information
488 Insurance broker
489 Advertising
490 Disclosure of business name
491 Representative’s duty of disclosure
Notices
492 Notices
Insurance Councils
493 Insurance councils
494 Delegated powers
495 Bylaws of insurance councils
496 Winding‑up of insurance councils
Regulations for Compensation Plan and Other Matters
497 Compensation plan
498 Regulations
Part 4
Market Conduct
499 Dealing with unauthorized insurance agents
500 Amount of premium
501 Premium refunds
502 Payments to agent
503 Agent receiving premiums
504 Agent trustee of premiums
505 Additional fees
506 Providing copies of policies
507 Prohibiting use of certain forms
508 Disclosure of name
509 Unfair practices
510 Dealing with unauthorized insurers
511 Regulations
Part 5
Insurance Contracts
Subpart
1
Insurance Contracts in Alberta
512 Application
513 Terms, etc., of contracts
514 Appraisals
515 Relief against forfeiture
516 Payment of insurance money
517 Waivers
518 Effect of delivery of policy
519 Insurer to furnish forms
520 When action may be brought
521 Relief from forfeiture
522 Consolidation of actions
523 Payment to payee domiciled or resident abroad
524 Notice
525 Furnishing of copy to insured
526 Inconsistencies
527 Imperfect compliance
528 Insurance against loss through negligence
529 Claim for indemnity
530 Execution against insured unsatisfied
Insurance as Collateral Security
531 Insurance as collateral security
532 Assignment of premium refund
533 Payment into Court by insurer
534 Filing of copy of policy, etc., with Superintendent
535 Variable life insurance policies
536 Regulations
Subpart
2
Fraternal Societies
537 Definition
538 Policy
539 Group insurance policy
540 Rules deliverable on demand
541 Member’s liability
542 Notice to members
Subpart 3
Fire Insurance
General Provisions
543 Application of Subpart
544 Extent of coverage
545 Over‑insurance
546 Application for fire insurance
547 Form of contract
548 Mortgagees and other payees
549 Statutory conditions
550 Limitation of liability clause
551 Rateable contributions
552 Special stipulations
553 Subrogation
Subpart
4
Life Insurance
554 Definitions
Application of Subpart
555 Annuity deemed life insurance
556,557 Application of Subpart
Issuance of Policy and Contents
558 Issuance of policy
559,560 Particulars in policy
561 Particulars in certificate
Formation of Contract
562 Insurable interest
563 Persons insurable
564 When contract takes effect
565 Cheque for premium not honoured
566 Payment of premium by beneficiary
567 Disclosure of material facts
568 Disclosure and misrepresentation by insured
569 Non‑disclosure and misrepresentation by insurer
570,571 Misstatement of age
572 Suicide clause
573 Reinstatement of contract
Designation of Beneficiaries
574 Designation of beneficiary
575 Irrevocable designation
576 Designation in will
577 Trustee for beneficiary
578 Beneficiary predeceasing life insured
579 Enforcement of payment by beneficiary
580 Insurance money not part of estate
Dealings with Contract
581 Assignment of insurance
582 Entitlement to dividends
583 Third party policies
584 Priority of interest
585 Enforcement of right
Minors
586 Minors
Proceedings under Contract
587 Proof of claim
588 Payment of insurance money
589 Action on contract made elsewhere
590 Limitation of actions
591 Persons to whom insurance money payable
592 Declaration by Court as to sufficiency of proof
593 Declaration of presumption of death
594 Court order re payment of insurance money
595 Order stays pending action
596 Right of appeal
597 Order re furnishing of further evidence
598 Order for payment into Court
599 Simultaneous deaths
600 Commutation of instalments of insurance money
601 Insurer holding insurance money
602 Order for payment into Court
603 Fixing of costs
604 Insurance money payable to minor
605 Payment to representative
Miscellaneous Provisions
606 Agent of insurer
607 Information as to notices
Subpart
5
Automobile Insurance
608 Definitions
609 Application of Subpart
Approval of Forms
610 Approval of forms
Application and Policy
611 Agents
612 Application for insurance
613 Misrepresentation, fraud or violation of condition
613.1 Prohibition on refusal to issue contract, etc.
614 Statutory conditions
615 Conditions not part of policy
Motor Vehicle Liability Policies
616 Coverage of owner’s policy
617 Coverage of non‑owner’s policy
618 Effect of lien on automobile
619 Territorial limits
620 Rights of unnamed insured
621 Liability of insurer
622 Liability arising from contamination
623‑626 Exceptions to liability of insurer
626.1 Reductions of automobile accident claim awards
627 Limits of motor vehicle liability policy
628 Hospitals Act
629 Accident insurance benefits
630 Stipulation in motor vehicle liability policy
631 Excess insurance
632 Agreements re deductible amounts
633 Coverage under motor vehicle liability
and
nuclear energy hazard liability policies
634 Determining which insurer to be liable
635 Rights of creditors
635.1 Regulations re notice of legal representation
636 Payment as release of claim
637 Notice of action against insured to insurer
637.1 Regulations re disclosure of policy limits
638 Physical damage cover
639 Adjustment of claim with insured
Limited Accident Insurances
640 Uninsured motorist
641 Medical expenses, etc.
642 Accident insurance benefits
643 Demand for particulars of insurance
644 Recovery by unnamed insured
645 Priority of payments
646 Payment of insurance money into Court
647 Limitation re commencement of action
648 Demand on claimant for particulars
649 Variations in policy
Other Insurance
650 Proportioning liability of insurer
Minor Injuries
650.1 Minor injury
Structured Judgments
650.2 Regulations re structured judgments
Subrogation
651 Subrogation of insurer to rights of recovery
Automobile Insurance Rate Board
652 Definitions
653 Rate Board established
654 Powers and duties of Board
655 Annual report
Premiums for Basic Coverage
656 Premiums for basic coverage
657 Discounts and surcharges
658 Procedures
659 Prohibition
Premiums for Additional Coverage
660 Premiums for additional coverage
660.1 Review of premiums for additional coverage
660.2 Regulations
661 Application of Government approved industry plan
661.1 Premium freeze
661.2 Withdrawal from business
Methods of Resolving Disputes
661.3 Dispute resolution
Previous Law and
Unforeseen and
Transitional Matters
661.4 Provision of insurance pursuant to previous law
661.5 Regulations re unforeseen matters
661.6 Transitional matters
Subpart
6
Accident and Sickness Insurance
662 Definitions
663,664 Application of Subpart
665 Issue of policy
666 Exceptions and particulars in policy
667 Particulars in group policy
668 Termination and replacement of group policies
669 Certificate covering group insurance
670 Exceptions or reductions
671 Statutory conditions
672 Omission or variation of conditions
673 Notice of statutory conditions
674 Termination for non‑payment
675 Unpaid premiums
676 Insurable interest
677 Lack of insurable interest
Policies on Lives of Minors
678 Capacity of minor
Misrepresentation and Non‑Disclosure
679 Non‑disclosure
680 Incontestability
681 Reinstatement
682 Pre‑existing conditions
683 Misstatement of age
Beneficiaries
684 Designation of beneficiary
685 Designation of “heirs”, etc.
686 Trustee for beneficiary
687 Payment of insurance money
688 Insurance money not part of estate
689 Enforcement of contract
690 Simultaneous deaths
691 Payment into Court
692 Insurance money payable to minor
693 Beneficiary under disability
694 Payments not exceeding $2000
695 Payment of insurance money
696 Action for payment
697 Insurer giving information
698 Undue prominence
699 Relief from forfeiture
700 Disability benefits
701 Presumption against agency
Subpart
7
Livestock Insurance
702 Application of Subpart
703 Scope of insurance
704 Application of Subpart 3 to livestock insurance
705 Application of Subpart 10
706 Term of contract
707 Renewals
708 Form of mutual contracts
709 Notice of claim
Subpart
8
Hail Insurance
710 Application of Subpart
711 Property insurable
712 Insurable interest
713 Application for contract
714 Information to appear on face of policy
715 Delivery of application to insurer
716 Effective date of contract
717 Reduction or increase in amount of premium
718 Consideration of applications
719 Notice to applicant
720 Policy in accordance with application
721 Expiration of hail insurance policies
722 Partial payment of loss clause
723 Rates of premium
724 Rate of commission
725 Notice of cancellation or alteration
726 Adjustment of loss
727 Refund of premium
728 Statutory conditions
Subpart
9
Weather Insurance
729 Application of Subpart
730 Insurability
731 Application of fire insurance provisions
732 Additional conditions
733 Duration of contract
734 Fixed payments on premium notes
Subpart 10
Mutual Insurance
Contracts
735 Application of Subpart 3
736 Minimum rates
737 Liability when policy is cancelled
738 Assignment of property insured
Premium Notes and Assessments
739 Premium notes
740 Payment on premium note
741 Form of premium note
742 Assessments on premium notes
743 Assessment
744 Notice of assessment
745 Assessment notices to mortgagee
746 Payment of assessment
747 Proportioning assessment
Recovery of Assessments
748 Recovery of assessments
749 Proof
750 Return of premium note
751 Retention of premium note
752 Lien
753 Judicial district
Part 6
Enforcement and Administration
Subpart
1
Enforcement
754 Definition
Division 1
Determining Compliance and Examinations
755 Exercising examiner’s powers
756 Annual examinations
757 Special examination
758 Demand for information
759 Entry into premises
760 Court order
761 Examiner’s report
762 Protection from liability
Division 2
Appraisal of Assets
763 Appraisal of assets
Division 3
Ministerial Orders
764 Minister’s order to comply
765 Compliance undertakings
766 Protecting property
767 Order for compliance
Division 4
Taking Control of Assets
768 Order for possession and control
769 Powers of Minister — provincial companies
770 Powers of Minister — extra‑provincial company
771 Application to the Court
772 Termination of possession and control
773 Payment of expenses of proceeding
Division 5
Remedial Actions
774 Definitions
775 Derivative action
776 Relief by Court from oppression or unfairness
777 Notice of application
778 Costs
779 Stay, etc., of application or action
Subpart
2
Offences and Penalties
780,781 Offences
782 Statements of financial standing
783 False or deceptive statements
784 Trafficking in life insurance policies
785 Liability of directors and officers
786 General penalty
787 Limitation on prosecution
788 Order to comply and make restitution
789 Administrative penalties
790 Regulations
Subpart 3
Administration, Appeals and General Matters
Administration
791 Delegation of powers
792 Superintendent of Insurance
792.1 Guidelines and interpretation bulletins
793 Examiners
794 Insurance Register
795 Inspection and copies of Register
796 Extension of time
797 Approval and consent
798 Orders, etc., binding on successors
799 Publication by Minister
800 Matters under oath
801 Fees
801.1 Regulations
802 Penalty
803 Forms
804 Filing by electronic means
805 Priority of Government claim
Appeals
806 Review by review board
807 Recording of evidence
808 Consent to apply to Court directly
809 Application to Court
810 Stay
General
811 Published notice as evidence
812 Certificate evidence
813 Copies of documents as evidence
814 Photocopies of documents
815 Court applications
816 Confidentiality of information
816.1 Privileged information
816.2 Insurance compliance self‑evaluative audit
Compensation Associations
817 Agreements with compensation associations
818 Compensation association regulations
819 Compensation associations
819.1 General Insurance OmbudService
Regulations
820 Regulations
Part 7
Financial Responsibility Cards
821 Definitions
822 Owner’s policy
823 Non‑Alberta policy — licensed insurer
824 Non‑Alberta policy — unlicensed insurer
825 Fund maintained by corporation
826 Regulations
Part 8
Transitional Provisions, Consequential Amendments, Repeals and Coming into Force
Subpart
1
Transitional Provisions
827 Definitions
828 Continuation of licensed special Act companies
829 Continuation of unlicensed special Act companies
830 Certificate of continuance
831 Effect of certificate of continuance
832 Effect of continuation
833 Application of Part 2, Subpart 2, Division 2
834 Bylaws
835 Shares with nominal or par value
836 Paid‑up capital
837 Deemed consent — significant interest
838 Voting by participating policyholder
839 Appointment of directors and officers continued
840 Directors’ remuneration
841 Participating policies
842 Bylaws
843 Deemed bylaws
844 Auditor
845 Actuary
846 Triennial solicitation of policyholders
847 Continuation of licences and certificates
848 Application of section 501
849 Regulations
Subpart
2
Consequential Amendments
850-870 Consequential amendments
Subpart
3
Repeals
871 Repeal of Acts
872 Repeal of Acts on Proclamation
873 Repeal of section
Subpart
4
Coming into Force
874 Coming into force
HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Alberta, enacts as follows:
Interpretation
Definitions
1 In this Act,
(a) “adjuster” has the meaning set out in section 2;
(b) “affiliate” has the meaning set out in section 3;
(c) “agency contract” means a contract between an insurance agent and an insurer in which the insurance agent agrees to act as an insurance agent in respect of insurance issued by the insurer, but does not include the arrangement that an insurance agent has with an insurer that is the service carrier for the Government approved industry plan under section 661;
(d) “automobile” includes a trolley bus and a self‑propelled vehicle, and the trailers, accessories and equipment of automobiles, but does not include watercraft, aircraft or railway rolling stock that runs on rails;
(e) “base capital” means base capital as defined in the regulations;
(f) “beneficial ownership” has the meaning set out in section 4;
(g) “body corporate” means any body corporate with or without share capital, wherever or however formed;
(h) “certificate of authority” means an insurance agent’s certificate of authority or an adjuster’s certificate of authority;
(i) “chief agency” means,
(i) in respect of a provincial company, the head office of the company, and
(ii) in respect of an insurer that is not a provincial company, the main office of the company in Alberta;
(i.1) repealed 2002 cA‑4.5 s45;
(j) “contract of insurance” includes any policy, certificate, interim receipt, renewal receipt or writing evidencing the contract, whether sealed or not, and a binding oral agreement;
(k) “control” has the meaning set out in section 5;
(l) “Court” means the Court of Queen’s Bench;
(m) “debt obligation” means a bond, debenture, note or other evidence of indebtedness whether secured or unsecured;
(n) “deposit‑taking institution” means
(i) Alberta Treasury Branches or a bank, credit union, loan corporation or trust corporation, or
(ii) a member institution of the Canada Deposit Insurance Corporation or of any other deposit insurance or guarantee plan prescribed under section 1(1)(l) of the Loan and Trust Corporations Act;
(o) “director” means an individual occupying the position of director of a body corporate regardless of the name given to the position, and “directors” refers to the directors of a body corporate as a body;
(p) “electronic media” means electronic media as defined in the regulations;
(q) “entity” means a body corporate, an unincorporated body, the Crown in right of Canada or in right of a province or territory, an agency of the Crown, a foreign government and any agency of a foreign government, but does not include an individual;
(r) “examiner” means an examiner appointed under section 793;
(s) “extra‑provincial company” means an insurer that is incorporated in a province or territory other than Alberta and that is authorized by that province or territory to carry on the business of insurance in that province or territory;
(s.1) “extra‑provincial Crown insurer” means an insurer that
(i) is formed by or under the laws of another province or territory,
(ii) has an exclusive right to perform an insurance activity in that province or territory, and
(iii) is beneficially owned or controlled by Her Majesty in right of that province or territory;
(t) “federally authorized company” means an insurer that is a company, society or foreign company as defined in the Insurance Companies Act (Canada) approved by order under that Act to carry on business or to insure risks in Canada;
(u) “financial institution” means
(i) a bank,
(ii) Alberta Treasury Branches,
(iii) a loan corporation or trust corporation incorporated by or under an Act of Canada, a province or a territory,
(iv) a credit union incorporated by or under an Act of Canada, a province or a territory,
(v) a federally authorized company, an extra‑provincial company or a licensed provincial company, and
(vi) any other prescribed entity;
(v) “fraternal society” means a body corporate that is a not for profit society, order or association formed for the purpose of making, with its members only, contracts of life, accident or sickness insurance in accordance with its constitution, bylaws and rules and this Act;
(w) “head office”, in respect of an insurer, means the place where the chief executive officer of the insurer transacts business;
(x) “holding body corporate” has the meaning set out in section 6;
(y) “incorporator”, in respect of a provincial company, means a person who applies for the incorporation of the company;
(z) “instrument of incorporation” means the certificate, special Act, charter, letters patent or other document incorporating, amalgamating or continuing a body corporate, and includes all amendments to it;
(aa) “insurance” means the undertaking by one person to indemnify another person against loss or liability for loss in respect of certain risk or peril to which the object of the insurance might be exposed or to pay a sum of money or other thing of value on the happening of a certain event and, without limiting the generality of the foregoing, includes life insurance;
(bb) “insurance agent” means a person who, for compensation,
(i) solicits insurance on behalf of an insurer, insured or potential insured,
(ii) transmits an application for insurance from an insured or potential insured to an insurer,
(iii) transmits a policy of insurance from an insurer to an insured,
(iv) negotiates or offers to negotiate insurance on behalf of an insurer, insured or potential insured or the continuance or renewal of insurance on behalf of an insurer or insured, or
(v) enrolls individuals in prescribed contracts of group insurance,
but does not include an insurer;
(cc) “insurance agent’s certificate of authority” includes a restricted insurance agent’s certificate of authority;
(dd) “insurance council” means an insurance council referred to in section 493;
(ee) “insurance money” includes all insurance money, benefits, surplus, profits, dividends, bonuses and annuities payable by an insurer under a contract of insurance;
(ff) “insurer” means any person that undertakes or effects, or agrees or offers for valuable consideration to undertake or effect, a contract of insurance, including the underwriters or syndicates of underwriters operating on the plan known as Lloyd’s, but does not include a person who exchanges with other persons reciprocal contracts of indemnity or inter‑insurance as part of a reciprocal insurance exchange;
(gg) “licence” means a licence under this Act unless the provision in which the term is used specifies otherwise;
(hh) “licensed provincial company” means a provincial company that holds a valid and subsisting licence or that holds an unexpired licence that has been suspended;
(ii) “life company” means an insurer that is permitted to insure
(i) only those risks falling within the class of life insurance, or
(ii) only those risks falling within the class of life insurance and accident and sickness insurance or another class of insurance specified in the regulations under section 35(2);
(jj) “market conduct activities” means activities that are carried out in the course of or for the purpose of the marketing, sale or distribution to the public of, or the performance of, any contract of insurance or service that an insurer offers to the public;
(kk) “Minister” means the Minister determined under section 16 of the Government Organization Act as the Minister responsible for this Act;
(ll) “motor vehicle liability policy” means a policy or part of a policy evidencing a contract insuring
(i) the owner or driver of an automobile, or
(ii) a person who is not the owner or driver of an automobile where the automobile is being used or operated by the person’s employee or agent or any other individual on the person’s behalf,
against liability arising out of bodily injury to or the death of an individual or loss or damage to property caused by an automobile or the use or operation of an automobile;
(mm) “mutual provincial company” means a provincial company that does not have common shares and that is formed for the purpose of issuing participating policies;
(nn) “non‑owner’s policy” means a motor vehicle liability policy insuring a person solely in respect of the use or operation by the person or on the person’s behalf of an automobile that the person does not own;
(oo) “officer” means
(i) in relation to a body corporate, a chief executive officer, president, vice‑president, secretary, controller, treasurer and any other individual designated as an officer of the body corporate by bylaw or by resolution of the directors of the body corporate, and
(ii) in relation to any other entity, any individual designated as an officer of the entity by bylaw, by resolution of the members of the entity or otherwise;
(pp) “owner’s policy” means a motor vehicle liability policy insuring a person in respect of the ownership, use or operation of an automobile owned by the person and within the description or definition of automobile in the policy and, if the contract so provides, in respect of the use or operation of any other automobile;
(qq) “participating policy” means a policy issued by an insurer that entitles its holder to participate in the profits of the insurer;
(rr) “participating policyholder” means the holder of a participating policy;
(ss) “person” means an individual, entity or personal representative;
(tt) “personal representative” means an executor, administrator, guardian, committee, trustee, assignee, receiver or liquidator;
(uu) “policy” means an instrument evidencing a contract of insurance;
(vv) “premium” means the single or periodical payment to be made for insurance, and includes dues, assessments and other consideration;
(ww) “premium note” means an instrument given as consideration for insurance by which the maker of the instrument undertakes to pay the sum or sums that may be legally demanded by the insurer, the aggregate of those sums not to exceed an amount specified in the instrument;
(xx) “professional advisor” means
(i) an auditor,
(ii) an actuary,
(iii) a lawyer, accountant, appraiser, architect or engineer, or
(iv) any other person whose membership in a profession would tend to lend credibility to a statement made or opinion given by that person,
and includes an individual who is a member of or who works in a professional capacity for a partnership, body corporate or other association of persons that is a professional advisor;
(yy) “property” that is the subject of a contract of insurance includes
(i) profits, earnings and other pecuniary interests, and
(ii) expenditure for rents, interest, taxes and other expenses and charges and expenditures in respect of inability to occupy the insured premises, but only to the extent provided for in the contract;
(zz) “property and casualty company” means an insurer that is not a life company;
(aaa) “provincial company” means an insurer incorporated under this Act;
(bbb) “provincial life company” means a provincial company that is a life company;
(ccc) “provincial property and casualty company” means a provincial company that is a property and casualty company;
(ddd) “proxy” means a completed and executed form of proxy by means of which a participating policyholder or shareholder appoints a proxyholder to attend and act on behalf of the participating policyholder or shareholder at a meeting of participating policyholders or shareholders;
(eee) “proxyholder” means the person appointed by proxy to attend and act on behalf of a participating policyholder or shareholder at a meeting of participating policyholders or shareholders;
(fff) “reciprocal insurance exchange” means a group of subscribers exchanging reciprocal contracts of indemnity or inter‑insurance with each other through a principal attorney as defined in section 78(b);
(ggg) “relative”, when used with respect to individuals, means related by blood, marriage or adoption or by virtue of an adult interdependent relationship;
(hhh) “reporting issuer” means a reporting issuer within the meaning of that term in the Securities Act;
(iii) “security” means
(i) in relation to a body corporate, a share of any class of shares of the body corporate or a debt obligation of the body corporate, and includes a warrant of the body corporate, but does not include a deposit with a deposit‑taking institution or any instrument evidencing such a deposit, and
(ii) in relation to any other entity, any ownership interest in or debt obligation of the entity,
but does not include a policy;
(jjj) “security interest” means an interest in or charge on property by way of mortgage, lien, pledge or otherwise taken by a creditor or guarantor to secure the payment or performance of an obligation;
(kkk) “significant interest” has the meaning set out in section 8;
(lll) “special broker” means a person who, for compensation, negotiates or offers to negotiate insurance, or the continuance or renewal of insurance, with unlicensed insurers in respect of any matter or thing in Alberta;
(mmm) “special resolution” means a resolution passed by a majority of not less than 2/3 of the votes cast by the participating policyholders or shareholders who voted in respect of that resolution or signed by all the participating policyholders or shareholders entitled to vote on that resolution;
(mmm.1) “spouse” means the husband or wife of a married person but does not, for the purposes of sections 256, 314 and 434, include a spouse who is living separate and apart from the person if the person and spouse have separated pursuant to a written separation agreement or if their support obligations and family property have been dealt with by a court order;
(nnn) “subsidiary” has the meaning set out in section 9;
(ooo) “subsisting” means, in respect of a licence or certificate of authority, that the licence or certificate has not expired and has not been cancelled;
(ppp) “substantial investment” has the meaning set out in section 10;
(qqq) “Superintendent” means the Superintendent of Insurance appointed under this Act;
(rrr) “total assets” means total assets as defined in the regulations;
(sss) “unincorporated body” means a trust, partnership, fund or other unincorporated association or organization;
(ttt) “valid” means, in respect of a licence or certificate of authority, that the licence or certificate is not under suspension and has not been cancelled;
(uuu) “voting share” means a share of any class of shares of a body corporate carrying voting rights under all circumstances or by reason of an event that has occurred and is continuing or by reason of a condition that has been fulfilled.
RSA 2000 cI‑3 s1;2002 cA‑4.5 s45;2005 c27 s2
Adjuster
2(1) For the purposes of this Act, “adjuster” means a person who, for compensation,
(a) directly or indirectly solicits the right to negotiate the settlement of a loss under a contract of insurance on behalf of an insured or insurer or a reciprocal insurance exchange, or
(b) negotiates the settlement of a loss under a contract of insurance on behalf of an insured or insurer or a reciprocal insurance exchange.
(2) For the purposes of this Act, an adjuster does not include
(a) a lawyer when practising law,
(b) a trustee of property or an agent of an owner of or person having an insurable interest in property who negotiates a settlement of a loss under a contract of insurance in respect of the property,
(c) an insurer, or
(d) an employee of an insured who negotiates the settlement of a loss under a contract of insurance on behalf of the insured.
1999 cI‑5.1 s2
Affiliate
3(1) An entity is affiliated with another entity if one of them is controlled by the other or both of them are controlled by the same person.
(2) The affiliates of an entity are deemed to be affiliated with all other entities with which the entity is affiliated.
1999 cI‑5.1 s3
Beneficial ownership
4(1) A security or other interest is beneficially owned by a person when it is held
(a) directly by that person, or
(b) through a personal representative or other intermediary
for the use or benefit of that person otherwise than as a security interest.
(2) A person is deemed to own beneficially securities that are beneficially owned by an entity controlled by that person.
(3) If a person owns securities in a corporation that itself owns securities in a body corporate, in determining the person’s beneficial ownership of securities in the body corporate for the purposes of subsection (2) no regard is to be taken of the securities of the body corporate that are owned by the corporation.
1999 cI‑5.1 s4
Control
5(1) A person controls a body corporate if the person holds or beneficially owns securities of the body corporate to which are attached more than 50% of the votes that may be cast to elect directors of the body corporate and the votes attached to those securities are sufficient, if exercised, to elect a majority of the directors of the body corporate.
(2) A person controls an unincorporated body if the person holds or beneficially owns more than 50% of the beneficial interest, however designated, into which the body is divided and the person is able to direct the affairs of the entity.
(3) Despite subsections (1) and (2), a person controls an entity if the person has, in relation to the entity, any direct or indirect influence that, if exercised, would result in control in fact of the entity.
(4) A holding body corporate is deemed to control any entity that is controlled or deemed to be controlled by a subsidiary of the holding body corporate.
(5) An entity that controls another entity is deemed to control any entity that is controlled or deemed to be controlled by the other entity.
1999 cI‑5.1 s5
Holding body corporate
6 A body corporate is the holding body corporate of a body corporate that is its subsidiary.
1999 cI‑5.1 s6
Ordinarily resident in Canada
7 An individual is ordinarily resident in Canada if the individual is
(a) a Canadian citizen ordinarily resident in Canada,
(b) a Canadian citizen who does not live in Canada but is a member of a prescribed class of individuals, or
(c) a permanent resident within the meaning of the Immigration and Refugee Protection Act (Canada) and ordinarily resident in Canada, except a permanent resident who has been ordinarily resident in Canada for more than one year after the time at which the individual first became eligible to apply for Canadian citizenship.
RSA 2000 cI‑3 s7;2008 c19 s3
Significant interest
8 A person has a significant interest in a class of shares of a body corporate where the aggregate of
(a) any shares of that class beneficially owned by the person, and
(b) any shares of that class beneficially owned by entities controlled by the person
exceeds 10% of all of the outstanding shares of that class of shares of the body corporate.
1999 cI‑5.1 s8
Subsidiary
9 A body corporate is a subsidiary of another body corporate if
(a) it is controlled by
(i) that other,
(ii) that other and one or more bodies corporate each of which is controlled by that other, or
(iii) 2 or more bodies corporate each of which is controlled by that other,
or
(b) it is a subsidiary of a body corporate that is that other’s subsidiary.
1999 cI‑5.1 s9
Substantial investment
10(1) A person has a substantial investment in a body corporate when
(a) the voting rights attached to the aggregate of any voting shares of the body corporate beneficially owned by the person exceed 10% of the voting rights attached to all of the outstanding voting shares of the body corporate, or
(b) the aggregate of any shares of the body corporate beneficially owned by the person represents ownership of more than 25% of the shareholders’ equity of the body corporate.
(2) A person has a substantial investment in an unincorporated body where the person beneficially owns more than 25% of all the ownership interests, however designated, into which the body is divided.
1999 cI‑5.1 s10
Incorporated
11(1) When this Act or the regulations refer to a body corporate in relation to the jurisdiction in which it was incorporated or to the legislation under which it was incorporated, “incorporated” includes amalgamated and continued.
(2) This section does not apply to Divisions 1 and 2 of Part 2, Subpart 2.
1999 cI‑5.1 s11
Contracts made in Alberta
12(1) A contract of insurance is deemed to have been made in Alberta if
(a) it insures a person who is domiciled or resident in Alberta when the contract is made, or
(b) the subject‑matter of the contract is property that is or will be located in Alberta.
(2) Subsection (1) does not apply to a contract of life insurance to which Part 5, Subpart 4 applies.
(3) This section has effect despite any agreement, condition or stipulation to the contrary.
1999 cI‑5.1 s12
Application
Mutual benefit societies
13(1) In this section, “mutual benefit society” means a body corporate formed for the purpose of providing sick, disability or funeral benefits for its members.
(2) This Act does not apply to a mutual benefit society if,
(a) in the case of sick or disability benefits, the society provides benefits of $12 or less per week, and
(b) in the case of funeral benefits, the society provides benefits of $400 or less in respect of one funeral.
1999 cI‑5.1 s13
Benefits provided under authority of federal Act
14 This Act does not apply to
(a) a body corporate that has, by or under the authority of an Act of the Parliament of Canada, created a fund for paying a gratuity on the event of death, sickness, infirmity, casualty, accident or disability or on any change of physical or mental condition, or
(b) a body corporate that has, by or under the authority of an Act of the Parliament of Canada, an insurance and provident society or association or an insurance or guarantee fund in connection with the body corporate.
1999 cI‑5.1 s14
Benefit plans for medical care, accident and sickness benefits
15(1) This Act, except section 626.1, does not apply to a prescribed entity to the extent of its provision to participants of prescribed benefits relating to medical care, accident and sickness benefits.
(2) For the purposes of this section and section 15.1, “participant” includes a beneficiary or dependant of a participant.
RSA 2000 cI‑3 s15;2003 c19 s30;2005 c27 s3
Employee benefit schemes for income replacement
15.1(1) In this section, “non‑accountable entities” means entities that are not accountable organizations within the meaning of section 16 of the Government Accountability Act.
(2) Subject to any regulations made under subsection (3), this Act, except section 570, does not apply to an entity to the extent of its provision to its participants of prescribed benefits whose subject‑matter is income replacement due to disability, sickness or disease, provided that no death benefit is payable.
(3) The Lieutenant Governor in Council may make regulations
(a) applying this Act to prescribed classes of non‑accountable entities in respect of their provision to their participants of benefits referred to in subsection (2), and
(b) respecting such provision of those benefits by those classes, and in particular, in relation to each such class,
(i) the nature and sufficiency of its financial resources as a source of continuing financial support for the financial obligations implicit in providing the benefits,
(ii) the availability of financial statements, prepared comparably to those referred to in section 219(1), to participants,
(iii) the degree of segregation of any assets relating to the provision of the benefits, or offer of the benefits, to participants from the assets of the entity,
(iv) the adequacy of any capital or reserves maintained by the entity to support the provision or offer of the benefits, and
(v) the extent to which matters referred to in this subsection are to be disclosed to participants, and the timing of any such disclosure.
(4) Notwithstanding subsection (3)(b)(v), where a non‑accountable entity provides benefits referred to in subsection (2) that are not underwritten by an insurer, it shall disclose to its participants, prior to or at the time that the benefits are offered, that the benefits are not underwritten by an insurer and that the benefits would be payable from the net income, retained earnings or other financial resources of the non‑accountable entity.
2003 c19 s30;2005 c27 s4;2008 c19 s6
Regulations
16 The Lieutenant Governor in Council may make regulations
(a) defining base capital, electronic media and total assets for the purposes of this Act;
(b) respecting any matter that is to be prescribed under sections 1 to 15.1;
(c) establishing the classes and subclasses of insurance for the purposes of this Act;
(c.1) defining, enlarging or restricting the meaning of any word or phrase used in this Act but not defined in this Act;
(d) exempting from the application of this Act
(i) a specific contract of insurance,
(ii) any type of contract of insurance that indemnifies a person who has an interest in a product against the product’s malfunction, failure or breakdown, or
(iii) contracts of insurance issued by a specified person or class of persons who operate on a non‑profit basis;
(e) respecting the terms and conditions that must be met to maintain an exemption under clause (d).
RSA 2000 cI‑3 s16;2003 c19 s31;2008 c19 s7
Crown Immunity
Crown immunity
16.1(1) In this section,
(a) “Crown” means the Crown in right of Alberta and includes a Minister of the Crown and agents and employees of the Crown;
(b) “reform amendments” means the amendments made to this Act by the Insurance Amendment Act, 2003 (No. 2) and the Insurance Amendment Act, 2005, and any regulations, orders in council, ministerial orders or board orders made pursuant to or by virtue of those amendments.
(2) No liability attaches to the Crown for any loss or damages that have arisen or may arise in respect of the reform amendments.
(3) All existing and future causes of action in law or in equity against the Crown in respect of the reform amendments, including, without limitation, Alberta Court of Queen’s Bench action number 0403‑14323 and the claims made in that action, are extinguished without costs.
(4) Nothing in this section acknowledges, admits, validates or recognizes a cause of action referred to in subsection (3).
2005 c27 s5
Part 1
Licensing of Insurers and Reciprocal Insurance Exchanges
Subpart 1
Licensing of Insurers
Insurer’s Duty to be Licensed
Undertaking insurance and carrying on business
17(1) An insurer undertaking a contract of insurance that is made in Alberta, whether the contract is original or renewed, except the renewal from time to time of life insurance policies, is, for the purposes of this Act, undertaking insurance in Alberta.
(2) An insurer is, for the purposes of this Act, carrying on business in Alberta if the insurer
(a) undertakes or offers to undertake insurance in Alberta,
(b) sets up or causes to be set up in Alberta any sign or inscription that contains the name of the insurer or that refers to insurance,
(c) carries on market conduct activities in Alberta,
(d) solicits or negotiates insurance in Alberta orally or in writing or by electronic media or any other medium of communication or by vending machines,
(e) issues or delivers any policy of insurance or interim receipt in Alberta,
(f) collects or receives or negotiates for or causes to be collected or received or negotiated for any premium for a contract of insurance in Alberta,
(g) inspects any risk in Alberta,
(h) adjusts any loss under a contract of insurance in Alberta,
(i) prosecutes or maintains in Alberta any action or proceeding in respect of a contract of insurance, or
(j) is listed in a telephone directory for any part of Alberta.
(3) Any body corporate or unincorporated body that receives in Alberta contributions from its members out of which any gratuities or benefits are paid directly or indirectly on the death of any of its members is, for the purposes of this Act, an insurer carrying on business in Alberta.
1999 cI‑5.1 s17
Requirement for licence
18(1) Except as provided for in this Act, no insurer may carry on business in Alberta unless the insurer holds a valid and subsisting licence.
(2) Except as provided for in this Act, no insurer may insure a risk in Alberta unless the insurer holds a valid and subsisting licence for a class of insurance that covers that risk.
(3) Except as provided for in this Act, no person may enter into or renew a contract of insurance to insure a risk in Alberta with an insurer unless
(a) the insurer holds a valid and subsisting licence, and
(b) the licence held by the insurer authorizes the insurer to undertake a class of insurance that covers the risk that is insured.
1999 cI‑5.1 s18
Licensing Requirements
Types of insurers
19(1) Only the following insurers are eligible for a licence under this Part:
(a) a provincial company;
(b) an extra‑provincial company;
(b.1) an extra‑provincial Crown insurer or an affiliate of an extra‑provincial Crown insurer;
(c) a federally authorized company;
(d) an insurer made up of underwriters or syndicates of underwriters operating on the plan known as Lloyd’s or any other plan approved by the Minister.
(2) Despite subsection (1), a fraternal society is eligible for a licence under this Part only if
(a) the fraternal society is a federally authorized company, or
(b) the fraternal society is incorporated under the laws of a province other than Alberta.
RSA 2000 cI‑3 s19;2005 c27 s6;2009 c7 s6
Application requirements
20(1) An application for a licence must
(a) be filed with the Minister,
(b) specify the classes of insurance that the applicant wishes to be authorized to undertake, and
(c) contain the information, material and evidence required by the Minister.
(2) An application for a licence must be accompanied with
(a) a plan for the conduct and development of the business of the company,
(b) in the case of an applicant other than a provincial company, a certified copy of its instrument of incorporation and bylaws,
(c) if the applicant is a federally authorized company, a certified copy of the order under the Insurance Companies Act (Canada) approving the company to carry on business or to insure risks in Canada,
(d) if the applicant is an extra‑provincial company, a certified copy of its authority to carry on business from the jurisdiction in which the company is incorporated and a certified copy of the latest audited financial statements of the company,
(e) copies of all policy forms and forms of application for insurance proposed to be used by the applicant in Alberta,
(f) the appointment of an individual as its attorney for service and the consent of the individual to act as the attorney for service, and
(g) the address of its chief agency in Alberta.
(3) After filing an application for a licence, the applicant must provide to the Minister any additional information, material and evidence the Minister considers necessary.
(4) An application by a provincial company for its first licence after its incorporation under this Act must
(a) set out the sums of money paid or to be paid by the company in connection with its incorporation and organization, and
(b) contain evidence satisfactory to the Minister that the directors have performed their duties under section 309.
1999 cI‑5.1 s20
Names
21(1) No insurer may be licensed with a name that does not meet the requirements of section 211(1) and the regulations under section 212.
(2) Subject to this Act and the regulations, an insurer may be licensed with a name in an English form, a French form, an English form and a French form or a combined English and French form, and it may be legally designated in Alberta by any such name.
(3) Where an insurer has a name that contravenes subsection (1), the Minister may license the insurer if it undertakes either to change its name to a name that does not contravene subsection (1) or to carry on business in Alberta under a name that does not contravene subsection (1).
(4) Where, through inadvertence or otherwise, an insurer becomes licensed with a name that contravenes subsection (1), the Minister may order as a condition of being licensed that the insurer carry on business under a name specified in the order.
1999 cI‑5.1 s21
22 Repealed 2005 c27 s7.
First licence of provincial company
23 Before issuing the first licence to a provincial company, the Minister must be satisfied that
(a) the meeting of shareholders referred to in section 133 has been held,
(b) the expenses of incorporation or organization that have been paid or are to be paid by the company are reasonable,
(c) the management, directors or persons who hold a significant interest in any class of shares of the company are fit as to character, and
(d) the management and directors have the competence and experience suitable for involvement in the operation of a financial institution.
1999 cI‑5.1 s23
Ability to carry on class of insurance
24 Before issuing the first licence to an insurer, the Minister must be satisfied that the insurer has the capacity and power to carry on the classes of insurance that it has specified in its application.
1999 cI‑5.1 s24
Base capital
25(1) Before issuing a licence to or renewing a licence of a provincial or extra‑provincial company, the Minister must be satisfied that
(a) the amount of the company’s base capital is at least,
(i) for life companies, $5 000 000 or any greater amount specified by the regulations, and
(ii) for property and casualty companies, $3 000 000 or any greater amount specified by the regulations,
and
(b) the company’s base capital is adequate, taking into account the nature of the business that it proposes to engage in, the expected volume of its business and any restrictions on its business.
(2) If, at any time during a year, a provincial or extra‑provincial company that is licensed ceases to have an adequate base capital as required under subsection (1)(a), the company must promptly
(a) give written notice of that fact to the Superintendent, and
(b) cease to undertake or to offer to undertake insurance in Alberta
until the Superintendent gives written notice to the company that the Superintendent is satisfied that the company’s base capital once again meets the requirements of subsection (1)(a).
RSA 2000 cI‑3 s25;2003 c40 s2
Compliance with market conduct laws
26 The Minister may refuse to issue a licence to or renew a licence of an insurer if the Minister is satisfied that the insurer is not complying with the laws respecting market conduct activities of other jurisdictions in which it is licensed.
1999 cI‑5.1 s26
Issuing licence
27 An insurer that applies for a licence under this Subpart or to renew such a licence is entitled to the licence if the Minister is satisfied that
(a) the requirements of this Act and the regulations relating to the licence have been met, and
(b) the insurer is in compliance with this Act and the regulations.
1999 cI‑5.1 s27
Notice of licence
28(1) The Minister must publish a notice of the licence of an insurer in The Alberta Gazette.
(2) This section does not apply to a renewal of a licence.
1999 cI‑5.1 s28
Expiry
29 A licence expires on December 31 of the year in which it is issued or renewed.
1999 cI‑5.1 s29
Renewal of licence
30 An application for a renewal of a licence must
(a) be filed with the Minister,
(b) specify the classes of insurance that the applicant wishes to be authorized to undertake, and
(c) contain the information, material and evidence required by the Minister.
1999 cI‑5.1 s30
Duty on expiration of licence
31(1) An insurer must not allow its licence to expire unless
(a) the insurer gives the Minister 30 days’ notice of its intention not to renew its licence, and
(b) the insurer provides the Minister with a statutory declaration stating that
(i) the insurer has no unpaid claims in respect of the insurer’s contracts of insurance made in Alberta,
(ii) all of the insurer’s contracts of insurance made in Alberta are discharged or expired or have been transferred or assigned to another licensed insurer, and
(iii) the insurer has no outstanding fees or taxes payable to the Government.
(2) When an insurer does not renew its licence, the Minister must publish a notice in The Alberta Gazette stating that the licence of the insurer has expired and setting out any information about the insurer or its business in Alberta that the Minister considers appropriate.
1999 cI‑5.1 s31
Terms and conditions
32(1) The Minister may, when issuing or renewing a licence, or at any time during the term of a licence, impose on the licence any terms or conditions that are consistent with this Act that the Minister considers appropriate.
(2) Before imposing terms or conditions under this section, the Minister must notify the insurer of the proposed terms or conditions and provide the insurer with an opportunity to make representations to the Minister.
RSA 2000 cI‑3 s32;2005 c27 s8
Automobile insurance
33 An insurer’s licence to undertake automobile insurance in Alberta is subject to the following conditions:
(a) in any action in Alberta against the licensed insurer or its insured arising out of an automobile accident in Alberta, the insurer must appear and must not set up any defence to a claim under a contract made outside Alberta, including any defence as to the limit or limits of liability and prescribed accident benefits under the contract, that could not be set up if the contract were evidenced by a motor vehicle liability policy issued in Alberta;
(b) in any action in another province or territory against the licensed insurer or its insured arising out of an automobile accident in that province or territory, the insurer must appear and must not set up any defence to a claim under a contract evidenced by a motor vehicle liability policy issued in Alberta, including any defence as to the limit or limits of liability and prescribed accident benefits under the contract, that could not be set up
(i) if the contract were evidenced by a motor vehicle liability policy issued in the other province or territory, or
(ii) under a scheme of no fault insurance that has been established by statute in the other province or territory.
1999 cI‑5.1 s33
Classes of Insurance
Classes of insurance
34(1) A licence issued by the Minister must set out the classes of insurance that the licensee is authorized to undertake.
(2) If a question arises as to the class of insurance into which any specific contract of insurance or form of policy falls, the Minister may determine the question and that determination is final for the purposes of this Act.
1999 cI‑5.1 s34
Restriction on classes of insurance
35(1) Subject to subsection (2), no licence may be issued that authorizes the licensee to undertake life insurance and any other class of insurance.
(2) A licence may be issued that authorizes the licensee to undertake life insurance and
(a) accident and sickness insurance, or
(b) any other prescribed class of insurance in the prescribed circumstances.
1999 cI‑5.1 s35
Prohibited activities
36(1) Except as permitted under this Act and the regulations, no licensed insurer may
(a) carry on business as an information management corporation as defined in the regulations, except in relation to the main business of an insurer;
(b) carry on business as a financial leasing corporation as defined in the regulations;
(c) accept deposits;
(d) carry on the business of offering services to the public as or accepting or executing the office of
(i) executor or administrator or trustee, or
(ii) guardian or trustee of a minor’s estate or of the estate of a mentally incompetent person;
(e) carry on any other activity that is prescribed for the purposes of this subsection.
(2) Nothing in this section prevents a subsidiary of a insurer from engaging in the activities described in subsection (1).
1999 cI‑5.1 s36
Scope of fire insurance licence
37(1) An insurer licensed to undertake fire insurance may, subject to its instrument of incorporation and any term or condition of its licence, insure or reinsure any property in which the insured has an insurable interest
(a) against loss or damage by fire, lightning or explosion,
(b) against loss or damage from falling aircraft, earthquake, windstorm, tornado, hail, sprinkler leakage, riot, malicious damage, weather, water damage, smoke damage, civil commotion and impact by vehicles, and
(c) against any one or more perils falling within any other prescribed classes of insurance.
(2) An insurer licensed to undertake fire insurance may, under a contract falling within Part 5, Subpart 3, insure an automobile against loss or damage.
1999 cI‑5.1 s37
Life insurance
38 An insurer licensed to undertake life insurance may, unless the licence expressly provides otherwise, include disability insurance in any policy of life insurance in respect of the same life or lives insured by the policy.
1999 cI‑5.1 s38
Attorney for Service
Attorney for service
39(1) Every insurer licensed under this Subpart must have an attorney for service who meets the requirements of subsection (2).
(2) The attorney for service must be an individual who is resident in Alberta.
(3) Service of any document in a legal action, suit or proceeding on an insurer may be effected by
(a) delivering the document to its attorney according to the Minister’s records,
(b) delivering the document to the address of its attorney according to the Minister’s records, or
(c) sending the document by registered mail to that address.
(4) A document sent by registered mail to the attorney’s address in accordance with subsection (3)(c) is deemed to be served 7 days from the date of mailing unless there are reasonable grounds for believing that the attorney did not receive the document at that time or at all.
(5) Every licensed insurer must ensure that its attorney’s office is open during normal business hours.
1999 cI‑5.1 s39
Attorney’s change of address
40 An attorney for service who changes addresses must, before the change occurs, notify the Minister of the date of the change and the new address.
1999 cI‑5.1 s40
Change in attorney
41(1) If the attorney for service of an insurer dies or resigns or if an insurer revokes the appointment of its attorney for service, the insurer must, as soon as is reasonably possible, provide the Minister with
(a) the appointment of its new attorney for service, and
(b) the consent of the individual to act as the attorney for service.
(2) An attorney for service of an insurer who intends to resign must
(a) give not less than 60 days’ notice to the insurer, and
(b) send a copy of the notice to the Minister.
1999 cI‑5.1 s41
No attorney for service
42 If an insurer does not have an attorney for service, service on the insurer may be effected by serving the Superintendent.
1999 cI‑5.1 s42
Reporting Requirements
Annual financial statements
43(1) Every insurer licensed under this Act must within 180 days after the end of the insurer’s financial year provide the Minister with a copy of the insurer’s audited financial statements for the financial year.
(2) Every licensed provincial company that has a subsidiary must within 180 days after the end of the subsidiary’s financial year provide the Minister with a copy of the subsidiary’s audited financial statements for the financial year.
(3) The Minister may, by written notice, require the holding body corporate of a licensed provincial company to provide the Minister with the holding body corporate’s annual audited financial statements and the annual audited financial statements in respect of any of the holding body corporate’s subsidiaries.
(4) Every licensed insurer must provide, on written request without charge, one copy of the insurer’s latest audited financial statements to a person who is resident in Alberta and who is a policyholder.
1999 cI‑5.1 s43
Annual return
44(1) Every licensed provincial company must file an annual return within the time period specified in subsection (2) that meets the requirements of subsections (3) and (4).
(2) The annual return must be filed
(a) in the case of a provincial company that is limited by the Minister to the reinsurance of risks, within 105 days after the end of the financial year in respect of which the return is prepared, or
(b) in the case of any other provincial company, within 60 days after the end of the financial year in respect of which the return is prepared.
(3) The annual return must
(a) set out the provincial company’s name and the address of its head office, the names and residential addresses of its directors, the names of its officers and auditor, the name and address of its attorney for service and, if the company’s records are held outside Alberta under section 217(4), the address at which those records are located,
(b) set out the assets, liabilities, receipts and expenditures of the company for the financial year and be audited in a manner that is satisfactory to the Minister,
(c) set out particulars of the business done in Alberta during the financial year,
(d) be accompanied with the actuary’s valuation referred to in section 405,
(e) set out any other information considered necessary by the Minister, and
(f) be approved and signed by the president, vice‑president or managing director or other director appointed for the purpose by the board of directors and by the secretary or manager of the company.
(4) The assets of a provincial company must be valued in accordance with the method established by the regulations under section 432(f).
1999 cI‑5.1 s44
Change in officials
45 If the directors, officers or auditor of a provincial company change, or if the residential addresses of the directors change, the company must notify the Minister of the new names or addresses within 15 days of the change.
1999 cI‑5.1 s45
Report on business particulars
46(1) Every insurer, other than a provincial company, licensed under this Act for all or part of a year (the “reporting year”) must submit to the Minister before the last day of February of the year following the reporting year a report that sets out the particulars of the insurer’s insurance business written in Alberta during the reporting year.
(2) Instead of submitting the report referred to in subsection (1) to the Minister, the Minister may allow an insurer to submit the report to an official of a government in Canada who has an information sharing agreement with the Minister.
1999 cI‑5.1 s46
Records to be filed
47(1) Every licensed insurer that carries on in Alberta the business of automobile insurance or any other class of insurance designated by the Minister must prepare and file with the Minister, or with a statistical agency designated by the Minister,
(a) a record of its premiums and of its loss and expense costs in Alberta, and
(b) a record of any other information required by the Minister,
in a manner and according to a system of classification that the Minister approves.
(2) A statistical agency designated by the Minister must compile the data in the records filed under subsection (1) in a manner approved by the Minister and submit the compiled data to the Minister.
(3) The reasonable remuneration and expenses of the statistical agency designated by the Minister are payable by the insurers whose data is compiled and, if there is a dispute with respect to the amount payable, the Minister’s decision is final.
(4) An amount determined by the Minister under subsection (3) is a debt owing to the statistical agency by the insurer specified by the Minister and may be recovered from the insurer by the agency in an action for debt.
RSA 2000 cI‑3 s47;2008 c19 s10
Audit of records
48(1) If at any time it appears to the Minister that an insurer is not keeping records in a manner that shows correctly the experience of the insurer in Alberta as required by section 46 or 47, the Minister may hire an accountant
(a) to audit the books and records of the insurer, and
(b) to give instructions that will enable the officers of the insurer to comply with those sections.
(2) The reasonable remuneration and expenses of the accountant that are approved by the Minister for an audit of an insurer under subsection (1) must be paid by the insurer.
(3) If the amount approved under subsection (2) is not paid by the insurer, the Minister may pay the amount and then recover it from the insurer in an action for debt.
1999 cI‑5.1 s48
Other information — licensed insurers
49 Every licensed insurer, other than a provincial company, must provide the Minister with a copy of
(a) any change to its instrument of incorporation within 7 days of the change’s being made, and
(b) notice of its being subject to an arrangement in a jurisdiction in which it is licensed other than Alberta that is in the nature of a compliance undertaking, within 7 days of the arrangement’s being made.
1999 cI‑5.1 s49
Additional information
50 A licensed insurer must provide to the Minister, within the time specified by the Minister,
(a) any information that is required by the Minister to enable the Minister to respond to inquiries on the company’s market conduct activities;
(b) any information that is required by the Minister for analytical or policy‑making purposes.
RSA 2000 cI‑3 s50;2008 c19 s11
Suspension, Cancellation
and Other Actions
Affecting Insurers’ Licences
Federally authorized companies
51(1) In this section, “order” means an order under the Insurance Companies Act (Canada) that approves a federally authorized company to carry on business or to insure risks in Canada.
(2) If the order of a federally authorized company is rescinded, the licence of the company under this Act is automatically cancelled.
(3) The Minister must revive the licence of a federally authorized company that has been cancelled under this section if the company obtains a new order before the licence would have expired.
(4) If the authority to insure a class of risks is deleted from the order of a federally authorized company, that class of insurance is automatically deleted from the licence of the company under this Act.
(5) The Minister must restore the class of insurance to the licence of the federally authorized company referred to in subsection (4) if the class of insurance is restored to the company’s order before the licence has expired.
1999 cI‑5.1 s51
Extra-provincial companies
52(1) If the licence of an extra‑provincial company is cancelled or suspended with or without conditions under the laws of the jurisdiction under which the company is incorporated, the Minister must,
(a) if the jurisdiction cancelled the licence, cancel the licence held by the company under this Act, or
(b) if the jurisdiction suspended the licence, suspend the licence on the same conditions.
(2) If under the laws of the jurisdiction under which an extra‑provincial company is incorporated terms, conditions or restrictions are imposed on its licence to carry on business in that jurisdiction, the licence held by the company under this Act is automatically subject to the same terms, conditions or restrictions unless the Minister provides otherwise under subsection (3).
(3) If the Minister suspends a licence under subsection (1) or if subsection (2) applies, the Minister may make any modifications to the terms, conditions or restrictions imposed under the laws of the other jurisdiction that the Minister considers necessary to take into account circumstances in Alberta.
(4) If under the laws of the jurisdiction under which an extra‑provincial company is incorporated a class of insurance is deleted from its licence issued in that jurisdiction, the class of insurance is automatically deleted from the licence held by the company under this Act.
(5) The Minister may revive the licence of an extra‑provincial company that has been cancelled under subsection (1), delete or vary terms or conditions imposed on the licence of an extra‑provincial company under subsection (2) or (3) or restore to the licence of an extra‑provincial company a class of insurance that is deleted under subsection (4) if the revival, deletion, variance or restoring occurs in the jurisdiction in which the extra‑provincial company is incorporated.
1999 cI‑5.1 s52
Cancellation on request
53(1) The Minister may, on the request of a licensed insurer, cancel the insurer’s licence.
(2) The Minister must not cancel the licence of an insurer under subsection (1) unless the Minister is satisfied that
(a) the insurer has no unpaid claims in respect of the insurer’s contracts of insurance made in Alberta,
(b) all of the insurer’s contracts of insurance made in Alberta are discharged or expired, or have been transferred or assigned to another licensed insurer, and
(c) the insurer has no outstanding fees or taxes payable to the Government.
(3) The Minister must publish a notice of the cancellation of a licence under this section in The Alberta Gazette.
1999 cI‑5.1 s53
Sanctions affecting licences
54(1) Where
(a) a licensed insurer or other person denies the Minister, the Superintendent or an examiner access to any information, records, documents or property that the Minister, Superintendent or examiner is authorized by this Act to have access to,
(b) the holding body corporate of a licensed provincial company fails to forward to the Minister audited financial statements in accordance with a notice under section 43(3),
(c) a licensed insurer or other person contravenes
(i) an order of the Minister,
(ii) a decision of a review board under section 806, or
(iii) an order of the Court under section 767 or 809,
(d) a licensed insurer is convicted of an offence under section 531(8) or 657,
(e) grounds exist for the possession and control of the assets of a provincial company by the Minister,
(f) a provincial company is carrying on or soliciting business in any jurisdiction other than Alberta without first being authorized to do so under the laws of that jurisdiction,
(g) a licensed insurer fails to comply with any term or condition to which its licence is subject,
(h) a licensed insurer does not, for a period of 5 years or more, engage in the business of insurance,
(i) a licensed insurer fails to comply with the provisions of Part 4, or
(j) the amount of a licensed extra‑provincial company’s base capital at any time falls below the respective amount specified in or under section 25(a),
the Minister may cancel, suspend or refuse to renew the licence of the insurer, or may impose terms or conditions on its licence.
(2) Where the Minister proposes to act under subsection (1), the Minister must give notice of that intention to the licensed insurer.
(3) If, in the Minister’s opinion, the public interest may be prejudiced or adversely affected by any delay in acting under subsection (1), the Minister may, without notice, cancel or suspend the licence of the insurer or impose terms or conditions on its licence.
(4) The Minister must forthwith give notice to the insurer of any action taken under subsection (3).
(5) An insurer that receives a notice under subsection (2) or (4) and who wishes to have a hearing before the Minister must serve a written request for the hearing on the Minister within 15 days after receipt of the notice.
(6) If an insurer requests a hearing in accordance with subsection (5) in respect of an action taken by the Minister under subsection (3), the Minister may, after giving the insurer an opportunity to be heard, confirm the action taken or modify or reverse the action taken.
(7) If an insurer requests a hearing in accordance with subsection (5) in respect of the Minister’s proposed action under subsection (1), the Minister may, after giving the insurer an opportunity to be heard, take any of the proposed actions set out in the notice with or without modifications or decide not to take any of those actions.
(8) The Minister must publish in The Alberta Gazette notice of every cancellation or suspension of a licence under this section.
RSA 2000 cI‑3 s54;2003 c19 s32
Non‑payment of claims
55(1) The Minister must cancel the licence of an insurer if the Minister is satisfied that
(a) a judgment arising out of a contract of insurance made in Alberta has been issued against the insurer, and
(b) the judgment has become final in the regular course of law, is enforceable in Alberta and has remained unpaid for 30 or more days after becoming final.
(2) The Minister may revive a licence that has been cancelled under subsection (1) if the judgment against the insurer is paid within 6 months after the cancellation and the licence would not have expired.
1999 cI‑5.1 s55
Effect of cancellation or suspension
56(1) When an insurer’s licence is cancelled under this Subpart, the insurer may carry on business in Alberta only to the extent that it is necessary for the winding‑up of its business in Alberta.
(2) When an insurer’s licence is suspended under this Subpart, the insurer may carry on business in Alberta only in accordance with the terms and conditions of the suspension.
(3) When a class of insurance has been deleted from an insurer’s licence under this Subpart, the insurer must cease to undertake or to offer to undertake that class of insurance in Alberta.
1999 cI‑5.1 s56
Provisional liquidator
57(1) The Minister may appoint a provisional liquidator to be in charge of the affairs of a provincial company if
(a) the company fails to renew its licence without complying with section 31,
(b) the company’s application to renew its licence is refused, or
(c) the company’s licence is cancelled in circumstances other than those set out in section 53.
(2) Until a permanent liquidator is appointed by the Court, the provisional liquidator has all of the powers of the insurer, and none of the officers or directors of the provincial company may enter into a contract or incur any liability on behalf of the company without the approval of the provisional liquidator.
(3) A provisional liquidator of a provincial company must apply to the Court under section 190 for an order winding up the company.
(4) Despite subsection (3), a provisional liquidator of a provincial company may, with the approval of the Court, sell the business of the company as a going concern.
1999 cI‑5.1 s57
Remuneration of provisional liquidator
58(1) The Minister is responsible for establishing the remuneration of a provisional liquidator.
(2) The remuneration of a provisional liquidator of a provincial company and the provisional liquidator’s costs and expenses while acting as the provisional liquidator are payable by the company and are a first lien or charge on the assets of the company.
1999 cI‑5.1 s58
Municipal Licensing Fees
Exemption from certain fees
59 An insurer that holds a licence under this Act is exempt from the payment of any licence fee for the transaction of the business of insurance imposed by a municipality or Metis settlement.
1999 cI‑5.1 s59
Regulations
Regulations
60 The Lieutenant Governor in Council may make regulations
(a) specifying an amount of base capital for life or property and casualty companies for the purposes of section 25(a);
(b) respecting any matter that is to be prescribed under this Subpart;
(c) respecting the issuance of a licence to an extra‑provincial Crown insurer or an affiliate of an extra‑provincial Crown insurer including, without limitation, regulations suspending or modifying the application or operation of any one or more provisions of this Act in respect of the extra‑provincial Crown insurer or the affiliate, as the case may be.
RSA 2000 cI‑3 s60;2005 c27 s9
Subpart 2
Exceptions
Unsolicited Insurance
Unsolicited insurance
61(1) Despite section 18, an insurer that is not licensed may undertake insurance in Alberta with an insured if
(a) the insurance is effected without any solicitation whatsoever on the part of that insurer, and
(b) the insured, not later than 30 days after signing the contract of insurance or receiving any policy, interim receipt or insuring document issued by or on behalf of the insurer, whichever occurs first,
(i) notifies the Superintendent in writing under oath of the terms of the insurance, the insurer with whom the insurance is placed and the amount of premium paid or payable or premium notes given or to be given in connection with the insurance, and
(ii) at the same time pays to the Minister a charge equal to 50% of the premium paid or payable or premium notes given or to be given in connection with the insurance.
(2) If the charge referred to in subsection (1)(b)(ii) is not paid within 30 days from the time it becomes payable, a sum equal to 50% of the charge remaining unpaid becomes a penalty that forms a part of the charge and is recoverable with the charge.
(2.1) Despite subsection (1)(b)(ii), the Minister may reduce the charge to an amount not less than 10% of the premium paid or payable or premium notes given or to be given in connection with the insurance if the Minister is satisfied that the insurance was not available through a licensed insurer.
(3) Despite section 18, a person may enter into or renew a contract of insurance to insure a risk in Alberta with an unlicensed insurer if the requirements of subsection (1)(a) and (b) have been met.
(4) This section does not apply to a contract of insurance that may be evidenced by a motor vehicle liability policy.
RSA 2000 cI‑3 s61;2005 c27 s19;2008 c19 s13
Reinsurance
Reinsurance
62(1) In this section, “Alberta contract” means a contract of insurance made in Alberta, but does not include a contract of reinsurance.
(2) Despite section 18, an insurer, other than a provincial company, that is not licensed may enter into a contract as the insurer that reinsures risks in respect of an Alberta contract if the insurance business in Alberta of the insurer is restricted to the reinsurance of risks.
(3) Despite section 18, a licensed insurer that is the insurer under an Alberta contract may, subject to the regulations, enter into a contract of reinsurance in respect of the Alberta contract with an insurer referred to in subsection (2).
1999 cI‑5.1 s62
Special Brokers
Insurance through special broker
63(1) Despite section 18, an insurer that is not licensed may undertake insurance in Alberta with an insured if
(a) the insurance cannot be obtained from licensed insurers,
(b) the insurance is effected through a person who holds a valid and subsisting special broker’s licence for that class of insurance,
(c) before the insurance is undertaken the special broker obtains from the proposed insured a signed and dated document
(i) describing the nature and amount of the insurance required, and
(ii) stating that the insurance cannot be obtained from licensed insurers and specifying the licensed insurers who refused the proposed insured’s application,
and
(d) before the insurance is undertaken the special broker discloses in writing to the proposed insured that the insurance will be placed with an unlicensed insurer.
(2) Despite section 18, a person may enter into or renew a contract of insurance to insure a risk in Alberta with an unlicensed insurer if, subject to subsection (2.1), the requirements of subsection (1)(a) to (d) have been met.
(2.1) Subsection (1)(c) and (d) do not apply if
(a) the special broker is an affiliate of the insurance agent that places the insurance, and
(b) the insurance is placed outside Alberta.
(3) This section does not apply to a contract of insurance that may be evidenced by a motor vehicle liability policy.
RSA 2000 cI‑3 s63;2008 c19 s14
Certificate of authority
64 No person may be issued a special broker’s licence for a class of insurance or have a special broker’s licence renewed for a class of insurance unless the person holds an insurance agent’s certificate of authority, other than a restricted insurance agent’s certificate of authority, for that class of insurance.
1999 cI‑5.1 s64
Financial guarantee
65 No person may be issued a special broker’s licence or have a special broker’s licence renewed unless the person maintains a financial guarantee in a form satisfactory to the Minister in the prescribed amount.
1999 cI‑5.1 s65
Application for special broker’s licence
66(1) An application for a special broker’s licence or to renew a special broker’s licence must
(a) be filed with the Minister,
(b) specify the classes of insurance in respect of which the applicant wishes to transact business,
(c) contain the information, material and evidence required by the Minister, and
(d) be accompanied with proof that the financial guarantee referred to in section 65 is being maintained.
(2) After filing an application, the applicant must provide to the Minister any additional information, material and evidence the Minister considers necessary.
1999 cI‑5.1 s66
Issuing certificates
67 An applicant who applies for a special broker’s licence or a renewal of a special broker’s licence is entitled to the licence if the Minister is satisfied that the requirements of this Act and the regulations relating to the licence have been met.
1999 cI‑5.1 s67
Terms and conditions
68(1) The Minister may issue a special broker’s licence subject to terms and conditions provided for in the regulations.
(2) Every holder of a special broker’s licence must comply with the terms and conditions to which the licence is subject.
1999 cI‑5.1 s68
Expiration
69 A special broker’s licence expires on December 31 of the year in which it is issued or renewed.
1999 cI‑5.1 s69
Status of certificate of authority
70(1) When a person’s insurance agent’s certificate of authority expires, the person’s special broker’s licence is automatically cancelled.
(2) When a person’s insurance agent’s certificate of authority is suspended or cancelled, the person’s special broker’s licence is automatically suspended.
(3) The Minister must reinstate a person’s special broker’s licence that has been suspended under subsection (1) or (2) for a class of insurance if
(a) the person submits an application for reinstatement to the Minister,
(b) before the special broker’s licence would have expired, the certificate of authority is reinstated or the person is issued an insurance agent’s certificate of authority for that class of insurance, and
(c) the Minister is satisfied that the person is in compliance with the requirements of this Act and the regulations relating to special brokers.
1999 cI‑5.1 s70
Reporting requirements
71 A licensed special broker must within 10 days after the end of each month submit to the Minister a return containing the following information with respect to the insurance effected under section 63 by the broker during the month:
(a) the names of the insured;
(b) the nature of the insurance;
(c) the names of the unlicensed insurers;
(d) the amount of insurance placed with each unlicensed insurer and the rate and amount of premium paid to each unlicensed insurer.
1999 cI‑5.1 s71
Payments in respect of premiums
72(1) In respect of all premiums on insurance effected by a licensed special broker, the special broker must pay to the Minister the taxes on premiums that would be payable if the premiums had been received by a licensed insurer, and the payment must accompany the monthly return provided for in section 71.
(2) If the amount referred to in subsection (1) is not paid within 30 days from the time it becomes payable, a sum equal to 50% of the amount remaining unpaid becomes a penalty that forms a part of the amount referred to in subsection (1) and is recoverable with the amount.
RSA 2000 cI‑3 s72;2008 c19 s15
Records
73 A special broker must keep a separate account of insurance effected by the special broker.
1999 cI‑5.1 s73
Financial guarantee not in force
74(1) If, during the term of a special broker’s licence, the financial guarantee referred to in section 65 maintained in respect of that licence is no longer in force, the special broker must immediately notify the Minister, in writing, that the guarantee is not in force.
(2) If, during the term of a special broker’s licence, the financial guarantee referred to in section 65 maintained in respect of the licence is no longer in force, the licence is automatically suspended unless, while the guarantee is in force, the special broker satisfies the Minister that the special broker has obtained a new guarantee that meets the requirements of section 65.
(3) The Minister must reinstate a special broker’s licence that has been suspended under subsection (2) if
(a) the broker submits an application for reinstatement to the Minister,
(b) the broker satisfies the Minister that the broker has obtained a new financial guarantee that meets the requirements of section 65 before the licence would have expired, and
(c) the Minister is satisfied that the broker is in compliance with the requirements of this Act and the regulations relating to special brokers.
1999 cI‑5.1 s74
Using different names
75 No person may advertise or carry on business as a special broker in a name other than the name set out in the person’s special broker’s licence.
1999 cI‑5.1 s75
Release of financial guarantee
76 A special broker is entitled to a release or cancellation of the financial guarantee submitted by the special broker when the Minister is satisfied that all insurance effected under section 63 by the broker is no longer in force or has been reinsured.
1999 cI‑5.1 s76
Regulations
Regulations
77 The Lieutenant Governor in Council may make regulations
(a) respecting the maximum proportion of risks that may be reinsured with unlicensed insurers for the purposes of section 62(3);
(b) respecting the requirement, conditions, training and experience that must be met before a special broker’s licence is issued or renewed;
(c) respecting terms and conditions that may be imposed on a special broker’s licence;
(d) respecting any matter that is to be prescribed under this Subpart.
1999 cI‑5.1 s77
Subpart 3
Licensing of Reciprocal
Insurance Exchanges
Definitions
78 In this Subpart,
(a) “approved securities” means
(i) in respect of a reciprocal insurance exchange that has its principal office in Alberta, investments that the exchange would be authorized to make if the exchange were a provincial company,
(ii) in respect of a reciprocal insurance exchange that has its principal office in a province other than Alberta, investments that the exchange is authorized to make under the laws of that province, and
(iii) in respect of a reciprocal insurance exchange that has its principal office outside Canada, investments that the exchange is authorized to make under Part XIII of the Insurance Companies Act (Canada);
(b) “principal attorney” means a person authorized by subscribers under a power of attorney to sign reciprocal contracts on their behalf and to act on the subscribers’ behalf in respect of any matter specified in the power of attorney relating to those contracts;
(c) “principal office” means the main office of the principal attorney;
(d) “reciprocal contract” means a reciprocal contract of indemnity or inter‑insurance;
(e) “subscribers” means persons exchanging reciprocal contracts with each other.
1999 cI‑5.1 s78
Licence required
79(1) No person may exchange a reciprocal contract unless
(a) the exchange is made by the person’s principal attorney,
(b) the exchange is part of a reciprocal insurance exchange that is licensed under this Subpart, and
(c) the reciprocal contract falls within a class of insurance that the reciprocal insurance exchange is authorized to undertake.
(2) No person may act as principal attorney or on behalf of a principal attorney in the exchange of reciprocal contracts for persons who are resident in Alberta unless the exchange is part of a reciprocal insurance exchange that is licensed under this Subpart.
1999 cI‑5.1 s79
Exception
80(1) Despite section 79, a person may, with respect to property located in Alberta, exchange a reciprocal contract that is a contract of property insurance and that is part of an unlicensed reciprocal insurance exchange if
(a) the exchange of the contracts is done for protection only and not for profit,
(b) the contracts are effected outside Alberta,
(c) the exchange of contracts is effected without any solicitation by the unlicensed reciprocal insurance exchange, and
(d) the person who owns the property, within 30 days after signing the contract,
(i) notifies the Superintendent in writing under oath of the terms of the contract, the persons with whom the insurance is placed and the amount of premium paid or payable or premium notes given or to be given or mutual liability assumed in connection with the insurance, and
(ii) at the same time pays to the Minister a fee equal to 50% of the premium paid or payable or premium notes given or to be given or mutual liability assumed in connection with the insurance.
(2) If the fee referred to in subsection (1)(d)(ii) is not paid within 30 days from the time when it becomes payable, a sum equal to 50% of the fee remaining unpaid becomes a penalty that forms a part of the fee and is recoverable with the fee.
RSA 2000 cI‑3 s80;2005 c27 s19;2008 c19 s16
Classes of insurance
81 Subject to section 82, a reciprocal insurance exchange may be licensed to undertake any class of insurance that a provincial company may be licensed to undertake except for the following classes:
(a) life insurance;
(b) accident insurance;
(c) sickness insurance;
(d) guarantee insurance.
1999 cI‑5.1 s81
Automobile insurance
82(1) No reciprocal insurance exchange may be licensed to undertake the type of automobile insurance that is evidenced by a standard owner’s policy referred to in section 610(6) or a standard garage policy.
(2) The Minister may issue a licence to a reciprocal insurance exchange that authorizes the exchange to undertake automobile insurance, other than the type described in subsection (1), if the Minister is satisfied that
(a) the exchange has signed reciprocal contracts or bona fide applications for such contracts for at least the prescribed number of automobiles, and
(b) arrangements are in effect for the reinsurance of all liabilities in excess of the prescribed limits.
RSA 2000 cI‑3 s82;2005 c27 s10
Fire insurance
83 The Minister must not issue a licence to a reciprocal insurance exchange that authorizes the exchange to undertake fire insurance unless the Minister is satisfied that the exchange has bona fide applications for reciprocal contracts for at least the prescribed number of separate fire insurance risks in Alberta or elsewhere and for at least the prescribed aggregate amount.
1999 cI‑5.1 s83
Application for licence
84(1) Persons who wish to have a reciprocal insurance exchange licensed must submit the following to the Minister:
(a) the name of the exchange;
(b) the name and address of its principal attorney;
(c) the classes of insurance that cover the reciprocal contracts to be exchanged;
(d) a copy of the form of the contract, agreement or policy under or by which the reciprocal contracts are to be effected or exchanged;
(e) a copy of the form of power of attorney under which the contracts are to be effected or exchanged;
(f) the location of the office from which the contracts are to be issued;
(g) if the exchange is required by section 94 to have an attorney for service, the appointment of an individual as its attorney for service and the consent of the individual to act as the attorney for service;
(h) any other information required by the Minister.
(2) Persons who wish to have a reciprocal insurance exchange’s licence renewed must submit the following to the Minister:
(a) the name of the exchange;
(b) the name of its principal attorney;
(c) any other information required by the Minister.
1999 cI‑5.1 s84
Name of exchange
85 The Minister may refuse to issue a licence to a reciprocal insurance exchange if the name or designation under which contracts are issued is so similar to a name or designation of a licensed exchange or licensed insurer that confusion or deception is likely.
1999 cI‑5.1 s85
Issuing licence
86 Applicants who apply for a licence for a reciprocal insurance exchange or to renew such a licence are entitled to the licence if the Minister is satisfied that
(a) the requirements of this Act and the regulations relating to the licence have been met, and
(b) in the case of an existing reciprocal insurance exchange, the exchange is in compliance with the requirements of this Act and the regulations.
1999 cI‑5.1 s86
Notice of licence
87(1) The Minister must publish a notice of the licence of a reciprocal insurance exchange in The Alberta Gazette.
(2) This section does not apply to the renewal of a licence.
1999 cI‑5.1 s87
Premium deposit
88 Every reciprocal insurance exchange must require its subscribers to provide to its principal attorney, as a condition of membership in the exchange, a premium reasonably sufficient for the risk assumed by the exchange.
1999 cI‑5.1 s88
Management of exchange
89 The affairs of a reciprocal insurance exchange must be managed by an advisory board or committee of subscribers established in accordance with the power of attorney.
1999 cI‑5.1 s89
Term of licence
90 A licence issued under this Subpart expires on December 31 of the year in which it is issued or renewed.
1999 cI‑5.1 s90
Annual return
91(1) Every licensed reciprocal insurance exchange must file an annual return for each calendar year within the time period specified in subsection (2) that meets the requirements of subsection (3).
(2) The annual return for a calendar year must be filed by the last day of the following February.
(3) The annual return must
(a) set out the name of the reciprocal insurance exchange and the name and address of its principal attorney and of its attorney for service,
(b) set out the financial information required by the Minister that is audited in a manner that is satisfactory to the Minister,
(c) set out any other information considered necessary by the Minister, and
(d) be signed by the principal attorney and at least 2 members of the advisory board or committee of subscribers of the reciprocal insurance exchange.
(4) If, in the Minister’s opinion, an annual return prepared by a reciprocal insurance exchange for another jurisdiction meets the requirements of subsection (3), the exchange may file that return to satisfy the requirements of subsection (1).
1999 cI‑5.1 s91
Signing contracts
92 After a reciprocal insurance exchange is licensed under this Subpart, a principal attorney may sign a reciprocal contract on behalf of a subscriber if the attorney is authorized by a power of attorney from the subscriber.
1999 cI‑5.1 s92
Court action
93 Despite any condition or stipulation in a power of attorney or in a reciprocal contract, any action or proceeding in respect of any such contract may be maintained in any court of competent jurisdiction in Alberta.
1999 cI‑5.1 s93
Attorney for service
94(1) Every reciprocal insurance exchange whose principal attorney is not located in Alberta must have an attorney for service who meets the requirements of subsection (2).
(2) The attorney for service must be an individual who is resident in Alberta.
(3) Service of any document in a legal action, suit or proceeding on a reciprocal insurance exchange may be effected by
(a) delivering the document to its attorney according to the Minister’s records,
(b) delivering the document to the address, according to the Minister’s records, of its attorney, or
(c) sending the document by registered mail to that address.
(4) A document sent by registered mail to the attorney’s address in accordance with subsection (3)(c) is deemed to be served 7 days from the date of mailing unless there are reasonable grounds for believing that the attorney did not receive the document at that time or at all.
(5) Every reciprocal insurance exchange that is required to have an attorney for service must ensure that its attorney’s office is open during normal business hours.
1999 cI‑5.1 s94
Attorney’s change of address
95 An attorney for service who changes addresses must, before the change occurs, notify the Minister of the date of the change and the new address.
1999 cI‑5.1 s95
Change in attorney for service
96(1) If the attorney for service of a reciprocal insurance exchange dies or resigns or if an exchange revokes the appointment of an attorney for service, the exchange must, as soon as is reasonably possible, provide the Minister with
(a) the appointment of its new attorney for service, and
(b) the consent of the individual to act as the attorney for service.
(2) An attorney for service of a reciprocal insurance exchange who intends to resign must
(a) give not less than 60 days’ notice to the exchange, and
(b) send a copy of the notice to the Minister.
1999 cI‑5.1 s96
No attorney for service
97 If a reciprocal insurance exchange that is required to have an attorney for service does not have an attorney for service, service on the exchange may be effected by serving the Superintendent.
1999 cI‑5.1 s97
Requirements for fire insurance
98(1) A reciprocal insurance exchange that is authorized to undertake fire insurance must ensure that no subscriber has assumed on any single fire insurance risk an amount greater than 10% of the net worth of the subscriber.
(2) The principal attorney of a reciprocal insurance exchange that is authorized to undertake fire insurance must file, when requested by the Minister, a statement under oath
(a) showing the maximum amount of indemnity on any single fire insurance risk, and
(b) stating that no subscriber has assumed on any single fire insurance risk an amount greater than 10% of the net worth of the subscriber.
1999 cI‑5.1 s98
Amount of reserve
99 Every reciprocal insurance exchange must maintain with the principal attorney as a reserve fund a sum in cash or approved securities equal to an amount calculated in accordance with the following formula:
(50% of (A‑B)) + (C‑D)
where
A is the amount of premiums collected or credited to the accounts of subscribers on reciprocal contracts in force having one year or less to run;
B is the amount paid to licensed insurers to reinsure the reciprocal contracts referred to in A;
C is the amount of premiums collected or credited to the accounts of subscribers on reciprocal contracts in force that have more than one year to run less the amount of those premiums that is attributable to the expired portion of the contracts;
D is the amount paid to licensed insurers to reinsure the reciprocal contacts referred to in C less the amount that is attributable to the expired portion of the reinsurance contracts.
1999 cI‑5.1 s99
Temporary exclusion from premium calculation
99.1(1) In this section, “premiums” means premiums collected or credited to the accounts of subscribers in respect of reciprocal contracts in force.
(2) A reciprocal insurance exchange may provide for the assessment on its subscribers of a premium surcharge over and above the premiums required by section 88.
(3) The premium surcharge may be assessed only during the year in which the reciprocal insurance exchange’s licence is initially issued and during the first full year of its renewal after its initial issue, except that the Minister may, on application by the exchange, extend the period of authorization of the surcharge for further one‑year periods until the 2nd anniversary of the end of that year in which the licence was initially issued.
(4) The reciprocal insurance exchange may exclude the premium surcharges from “premiums” for the purpose of calculating the reserve fund requirements of section 99.
2003 c19 s33
Guarantee fund
100(1) In addition to the reserve fund referred to in section 99, every reciprocal insurance exchange must maintain a guarantee fund in cash or approved securities in an amount calculated in accordance with the following formula:
(A ‑ B) + C
where
A is all liabilities associated with the operation of the exchange, including liabilities under reciprocal contracts undertaken by the exchange;
B is any amount that is recoverable from licensed insurers that have reinsured the reciprocal contracts referred to in A;
C is an amount set out in the regulations.
(2) Cash or approved securities maintained in the reserve fund referred to in section 99 must not be included in the guarantee fund.
1999 cI‑5.1 s100
Deficiency
101(1) If a reciprocal insurance exchange does not have the minimum amount required under sections 99 and 100, the subscribers or the principal attorney of the exchange must make up the deficiency forthwith.
(2) If funds other than those that accrued from premiums of subscribers are supplied to make up a deficiency, the funds must, so long as a deficiency exists, be deposited and held for the benefit of subscribers under the terms and conditions specified by the Minister.
1999 cI‑5.1 s101
Investments
102(1) Every reciprocal insurance exchange that has its principal office in a province or territory other than Alberta must ensure that the funds of the exchange that are required by the laws of the province or territory in which the principal office is located to be invested
(a) are invested in approved securities, and
(b) are within the limits for investments established by the laws of that province or territory for reciprocal insurance exchanges.
(2) Every reciprocal insurance exchange that has its principal office outside Canada must ensure that the funds of the exchange that are required by Part XIII of the Insurance Companies Act (Canada) to be invested
(a) are invested in approved securities, and
(b) are within the limits for investments established by Part XIII of the Insurance Companies Act (Canada).
1999 cI‑5.1 s102
Contracts
103 No reciprocal insurance exchange may, without the approval of the Superintendent, undertake any liability on a reciprocal contract or on any other contract of insurance except on behalf of a subscriber.
RSA 2000 cI‑3 s103;2008 c19 s20
Reinsurance
104 No principal attorney or reciprocal insurance exchange may effect reinsurance of any risks undertaken by the exchange in any other reciprocal insurance exchange.
1999 cI‑5.1 s104
Suspension or cancellation of licence
105(1) If a reciprocal insurance exchange or principal attorney fails or refuses to comply with or contravenes any provision of this Act or the regulations, the licence issued to the exchange may be suspended or cancelled by the Minister after notice and opportunity for a hearing before the Minister has been given to the exchange or its principal attorney.
(2) A suspension or cancellation under subsection (1) does not affect the validity of any reciprocal contracts effected before the suspension or cancellation of the rights and obligations of subscribers under the contracts.
(3) The principal attorney must give the subscribers notice of the suspension or cancellation and the Minister must publish notice of the suspension or cancellation in The Alberta Gazette.
1999 cI‑5.1 s105
Regulations
106 The Lieutenant Governor in Council may make regulations
(a) respecting the number of automobiles and limits for the purposes of section 82(2);
(b) prescribing the amount for “C” for the purposes of section 100;
(c) respecting any matter that is to be prescribed under this Subpart.
1999 cI‑5.1 s106
Part 2
Provincial Companies
Subpart 1
Status and Powers of
Provincial Companies
Capacity of provincial company
107(1) Subject to this Act, the regulations, its bylaws and any term or condition in its instrument of incorporation or licence, a provincial company
(a) has the capacity and the rights, powers and privileges of an individual, and
(b) has the capacity to carry on its business, conduct its affairs and exercise its powers in any jurisdiction outside Alberta to the extent that the laws of that jurisdiction permit.
(2) A provincial company must not
(a) carry on business or exercise any right, power or privilege that it is prohibited from carrying on or exercising by this Act, the regulations, its bylaws or any term or condition in its instrument of incorporation or licence, or
(b) exercise any of its rights, powers and privileges in a manner that contravenes this Act or the regulations.
1999 cI‑5.1 s107
Constructive notice
108 No person is affected by or is deemed to have notice or knowledge of the contents of a document concerning a provincial company by reason only that the document has been filed with the Minister or is available for inspection at an office of the company.
1999 cI‑5.1 s108
Authority of directors, officers and agents
109 A provincial company, a guarantor of an obligation of the company or a person claiming through the company must not assert against a person dealing with the company or dealing with any person who has acquired rights from the company
(a) that the instrument of incorporation or bylaws have not been complied with,
(b) that the persons named in the most recent notice of directors filed with the Minister under this Act are not the directors of the company,
(c) that a person held out by the company as a director, an officer or an agent of the company
(i) has not been duly appointed, or
(ii) has no authority to exercise a power or perform a duty that the director, officer or agent might reasonably be expected to exercise or perform,
or
(d) that a document issued by any director, officer or agent of the company with actual or usual authority to issue the document is not valid or not genuine,
unless the person has, or by virtue of the person’s position with or relationship to the company ought to have, knowledge of those facts at the relevant time.
1999 cI‑5.1 s109
Main business
110(1) Subject to this Act and the regulations, a provincial company must not engage in or carry on any business other than
(a) the business of insurance, or
(b) the business of providing financial services.
(2) For the purposes of this Act, the business of insurance includes any activity that is reasonably ancillary to the business of insurance.
(3) For the purposes of this Act, the business of providing financial services includes in respect of a provincial company
(a) acting as a receiver, liquidator or sequestrator,
(b) issuing payment, credit or charge cards and, in co‑operation with others including other financial institutions, operating a payment, credit or charge card plan,
(c) providing real property brokerage services,
(d) holding and otherwise dealing with real property,
(e) providing information processing services that the company has developed for its own use and that are an integral part of the company’s operations to entities in which the company has a substantial investment that do not provide information processing services to other entities,
(f) promoting merchandise and services to the holders of any payment, credit or charge card issued by the company,
(g) acting as a custodian of property,
(h) acting as a trustee for a trust in respect of a prescribed class of transaction,
(i) any of the activities referred to in section 111, and
(j) with the consent of the Minister, any other activity that is reasonably ancillary to the business of providing financial services.
(4) Subject to subsection (5), a provincial company must not carry on an activity that requires registration under the Securities Act.
(5) A provincial company may carry on an activity that is regulated under the Securities Act if the Securities Act allows the company to carry on the activity without being registered under that Act.
1999 cI‑5.1 s110
Networking
111 A provincial company may
(a) act as agent for any person in respect of the provision of any service that is provided by a financial institution or a body corporate in which the company is permitted to have a substantial investment,
(b) enter into an arrangement with any person in respect of the provision of that service, or
(c) refer any person to any such financial institution or body corporate.
1999 cI‑5.1 s111
Life insurance
112 No provincial company may issue a contract of life insurance that does not appear to be self‑supporting on reasonable assumptions as to interest, mortality and expenses.
1999 cI‑5.1 s112
Security interests
113(1) Subject to subsection (2), a provincial company must not create a security interest in any property of the company to secure an obligation of the company.
(2) This section does not apply to the creation of a security interest
(a) in relation to the reinsurance by the provincial company of risks insured by another insurer,
(b) on prescribed classes of personal property or prescribed classes of transactions, or
(c) on property having an aggregate value that is less than the prescribed amount.
1999 cI‑5.1 s113
Beneficial interests
114 A provincial company must not acquire any beneficial interest in property, other than by way of realization, that is subject to a security interest.
1999 cI‑5.1 s114
Debt obligations
115(1) A provincial life company shall not, and shall not permit its prescribed subsidiaries to, enter into a debt obligation or issue any share, other than a common share, if as a result the aggregate of the total debt obligations and the book value of the prescribed shares of the company and its prescribed subsidiaries would exceed 20% of the total assets of the company and its prescribed subsidiaries.
(2) A provincial property and casualty company shall not, and shall not permit its prescribed subsidiaries to, enter into a debt obligation or issue any share, other than a common share, if as a result the aggregate of the total debt obligations and the book value of the prescribed shares of the company and its prescribed subsidiaries would exceed 2% of the total assets of the company and its prescribed subsidiaries.
RSA 2000 cI‑3 s115;2008 c19 s21
Guarantees
116(1) A provincial company must not guarantee on behalf of any person other than itself the payment or repayment of any sum of money unless
(a) the sum of money is a fixed sum of money with or without interest on the fixed sum, and
(b) the person on whose behalf the company has undertaken to guarantee the payment or repayment has an unqualified obligation to reimburse the company for the full amount of the payment or repayment to be guaranteed.
(2) Subsection (1) does not apply in respect of any indemnity referred to in section 365.
(3) Subsection (1)(a) does not apply to a provincial life company where the person on whose behalf the provincial life company has undertaken to guarantee a payment or repayment is a subsidiary of the company and is primarily engaged in insuring risks that fall within a class of insurance that the company is authorized to insure.
1999 cI‑5.1 s116
Segregated Funds
Segregated funds restricted to life companies
117 A provincial property and casualty company must not
(a) issue policies, or
(b) accept or retain on the direction of a policyholder or beneficiary policy dividends or bonuses or policy proceeds that are payable on the surrender or maturity of the policy or on the death of the person whose life is insured,
where the liabilities of the company in respect of the policies or the amounts accepted or retained vary in amount depending on the market value of a fund consisting of a specified group of assets.
1999 cI‑5.1 s117
Where segregated funds required
118 A provincial life company that issues policies described in section 117 or accepts or retains amounts described in section 117 must, in respect of those policies or amounts,
(a) maintain separate accounts, and
(b) establish and maintain one or more funds consisting of assets that are segregated from the other assets of the company and that are specified as the assets on the market value of which the liabilities of the company in respect of those policies or amounts depend.
1999 cI‑5.1 s118
Creation and maintenance of segregated funds
119(1) A provincial life company may transfer an amount to a separate account referred to in section 118(a) for the purpose of maintaining or establishing a segregated fund under section 118.
(2) Subsection (1) is subject to the regulations and, in the case of a transfer from a participating account maintained pursuant to section 294, to the regulations under section 299.
1999 cI‑5.1 s119
Transfers from segregated funds
120 A provincial life company may, with the approval of the Minister, return the current value of an amount transferred pursuant to section 119 to the account from which the amount was transferred.
1999 cI‑5.1 s120
Claims against segregated funds
121 A claim against a segregated fund maintained pursuant to section 118 under a policy or for an amount in respect of which the fund is maintained has priority over any other claim against the assets of that fund.
1999 cI‑5.1 s121
Restriction of claims
122 The liability of a provincial life company under a policy or for an amount in respect of which a segregated fund is maintained pursuant to section 118
(a) does not, except to the extent that the assets of the fund are insufficient to satisfy a claim for any minimum amount that the company agrees to pay under the policy or in respect of the amount, give rise to a claim against any assets of the company other than the assets of that fund,
but
(b) to the extent that the assets of the fund are insufficient to satisfy such a claim, gives rise to a claim against the assets of the company, other than the assets of that fund.
1999 cI‑5.1 s122
Regulations
Regulations
123 The Lieutenant Governor in Council may make regulations
(a) respecting the business that a provincial company may engage in or carry on;
(b) respecting the disclosure of
(i) the name of the principal for whom a provincial company is acting as agent pursuant to section 111, and
(ii) whether any commission is being earned by a provincial company when acting as agent pursuant to section 111;
(c) respecting the transfer of amounts in respect of a segregated fund for the purposes of section 119;
(d) respecting any matter that is to be prescribed under this Subpart.
1999 cI‑5.1 s123
Subpart 2
Incorporation, Fundamental Changes and Dissolution of Provincial Companies
Alberta insurers
124(1) No insurer may be incorporated, amalgamated or continued in Alberta unless it is incorporated, amalgamated or continued under this Act.
(2) No fraternal society may be incorporated or continued under the laws of Alberta.
RSA 2000 cI‑3 s124;2009 c9 s6
Division 1
Incorporation
Application
125(1) One or more persons who wish to incorporate a provincial company must submit an application to the Minister that contains the following:
(a) the information, material and evidence specified by the Minister;
(b) a plan for the future conduct and development of the business of the company;
(c) its proposed financial year;
(d) the location of the head office of the company in Alberta;
(e) the names of the first directors of the company.
(2) After filing an application for incorporation, the applicants must
(a) provide to the Minister any additional information, material and evidence the Minister considers necessary, and
(b) publish a notice of the application, containing any information that the Minister specifies, in The Alberta Gazette and in a newspaper having general circulation in the place where the head office of the provincial company is to be located.
(3) Any person who objects to the proposed incorporation of a provincial company may, within 30 days after the date of publication of the notice in The Alberta Gazette under subsection (2), submit an objection in writing to the Minister.
(4) On receipt of an objection under subsection (3), the Minister may direct that a public hearing into the objection be held.
(5) The Minister may make rules governing the proceedings at public hearings held under subsection (4), and the Regulations Act does not apply to the rules.
(6) On the completion of the hearing, the Minister must ensure that a report of the hearing is made available to the public.
1999 cI‑5.1 s125
Factors to be considered
126 Before recommending that a provincial company be incorporated, the Minister must take into account all matters that the Minister considers relevant to the application, including
(a) the nature and sufficiency of the financial resources of the applicants as a source of continuing financial support for the company,
(b) the soundness and feasibility of the plan for the future conduct and development of the business of the company,
(c) the business record and experience of the applicants, and
(d) whether the company will be operated by persons who are fit as to character or who have the competence and experience suitable for involvement in the operation of an insurer.
1999 cI‑5.1 s126
Incorporation
127 The Lieutenant Governor in Council may, on the application of one or more persons and on the recommendation of the Minister, incorporate a provincial company by issuing a certificate of incorporation.
1999 cI‑5.1 s127
Contents of certificate of incorporation
128(1) The certificate of incorporation of a provincial company must set out the name of the company, its financial year and whether the company is a mutual provincial company.
(2) The Lieutenant Governor in Council may set out in the certificate of incorporation of a provincial company any term or condition not contrary to this Act that the Lieutenant Governor in Council considers advisable to deal with the particular circumstances of the company.
1999 cI‑5.1 s128
Notice of incorporation
129 The Minister must publish a notice of the incorporation of a provincial company in The Alberta Gazette.
1999 cI‑5.1 s129
First directors
130 The first directors of a provincial company are the directors named in the application for incorporation.
1999 cI‑5.1 s130
Effective date of incorporation
131(1) A provincial company comes into existence and is incorporated on the date set out in its certificate of incorporation.
(2) A certificate of incorporation is conclusive proof for the purposes of this Act and for all other purposes
(a) that the provisions of this Act in respect of incorporation and all requirements precedent and incidental to incorporation have been complied with, and
(b) that the provincial company has been incorporated under this Act on the date set out in the certificate of incorporation.
1999 cI‑5.1 s131
Division 2
Organization and Commencement
after Incorporation
First directors’ meeting
132(1) After a provincial company is incorporated, the directors of the company must hold a meeting.
(2) At that meeting the directors may, subject to this Subpart,
(a) make bylaws,
(b) adopt forms of share certificates and corporate records,
(c) authorize the issue of shares of the company,
(d) appoint officers,
(e) appoint an auditor to hold office until the first meeting of shareholders,
(f) make banking arrangements, and
(g) deal with any other matters necessary to organize the company.
(3) An incorporator or a director of the provincial company may call the meeting referred to in subsection (1) by giving not less than 5 days’ notice to each director, stating the time and place of the meeting.
1999 cI‑5.1 s132
Calling shareholders’ meeting
133(1) When the base capital of a provincial company reaches the amount required under section 25, the directors of the company must forthwith call a meeting of
(a) the shareholders of the company, in the case of a company that is not a mutual provincial company, or
(b) the incorporators of the company, in the case of a mutual provincial company.
(2) The shareholders or incorporators of a provincial company must, by resolution at the meeting called pursuant to subsection (1),
(a) approve, amend or reject any bylaw made by the directors of the company,
(b) elect directors to hold office for a term expiring not later than the close of the first annual meeting of shareholders following the election or, in the case of a mutual provincial company, not later than the close of the first annual meeting of policyholders following the election, and
(c) appoint an auditor to hold office until the close of the first annual meeting of shareholders or, in the case of a mutual provincial company, until the close of the first annual meeting of policyholders.
1999 cI‑5.1 s133
Term of first directors
134 A director named in the application for incorporation of a provincial company holds office until the election of directors at the meeting of shareholders or incorporators referred to in section 133(1).
1999 cI‑5.1 s134
Carrying on of business
135 Except as permitted in sections 136 and 137, a provincial company must not carry on any business until it is licensed under this Act.
1999 cI‑5.1 s135
Expenses charged to capital
136 A provincial company must pay all incorporation and organization expenses from the capital of the company or interest on the capital and the company must not charge directly or indirectly its policyholders for those expenses.
1999 cI‑5.1 s136
No payments until licensed
137 Until a provincial company is licensed under this Act, the company must not make any payment on account of incorporation or organization expenses except reasonable sums
(a) for the payment of remuneration of not more than 2 officers,
(b) for the payment of costs related to the issue of shares of the company, and
(c) for the payment of clerical assistance, legal services, accounting services, office accommodation at one location, office expenses, advertising, stationery, postage and travel expenses.
1999 cI‑5.1 s137
Deposits and investments
138 Until a provincial company is licensed under this Act, the company may
(a) deposit its capital and interest on the capital only in a deposit‑taking institution, and
(b) invest its capital and interest on the capital only in securities issued or guaranteed by the Government of Canada or any province or territory.
1999 cI‑5.1 s138
Time limit to acquire licence
139 If a provincial company does not become licensed within one year after it comes into existence or within any further period that the Minister may on application allow,
(a) its directors must forthwith take all reasonable steps to ensure that the company is dissolved under Division 11, and
(b) the company must not carry on any business or activity except for the sole purpose of dissolving the company.
1999 cI‑5.1 s139
Allowed disbursements
140(1) If the directors of a provincial company are required under section 139 to take all reasonable steps to ensure that the company is dissolved, no part of the capital of the company or interest on the capital may be used for the payment of incorporation and organization expenses, other than remuneration and costs referred to in section 137, unless the payment has been approved by a special resolution.
(2) If the amount of a payment approved by a special resolution for the payment of any incorporation and organization expenses is considered insufficient by the directors or if no special resolution for the payment of such expenses is passed, the directors may apply to the Court to settle and determine the amounts to be paid out of the capital of the company and interest on the capital before distribution of the balance to the shareholders or, where there are no shareholders, to the incorporators.
(3) The directors must, at least 21 days prior to the date fixed for the hearing of the application referred to in subsection (2), send to the shareholders or incorporators, as the case may be, a notice of the application, which notice must contain a statement of the amounts that are proposed to be settled and determined by the Court.
(4) In order that the amounts paid and payable under this section may be equitably borne by the shareholders or incorporators, as the case may be, the directors must, after the amounts of the payments have been approved by special resolution or settled and determined by the Court, fix the proportionate part of the amount of the payment chargeable to each shareholder or incorporator in the ratio of the amount paid in by each shareholder or incorporator to the aggregate of all the amounts paid in by all the shareholders or incorporators.
(5) After the amounts referred to in this section have been paid, the directors must pay to the shareholders or incorporators the respective balances of the money paid in by them together with any interest earned on that money, less the amount chargeable to each shareholder or incorporator under subsection (4).
1999 cI‑5.1 s140
Division 3
Continuance into Alberta
Restriction on continuance
141 Despite anything in this Division, no insurer formed outside Canada may be continued as a provincial company under this Act.
1999 cI‑5.1 s141
Continuance from another jurisdiction
142 A federally authorized company or an extra‑provincial company may be continued as a provincial company if
(a) the company submits an application to the Minister,
(b) the continuance of the company is authorized under the Act under which the company is incorporated,
(c) the applicant meets the requirements for incorporation under this Act,
(d) the Minister has received evidence showing the proposed continuance has been approved in conformity with the laws of the jurisdiction in which the company was incorporated,
(e) the Minister is satisfied that continuance as a provincial company will not adversely affect the policyholders, security holders or creditors of the company, and
(f) the company intends to undertake the classes of insurance in Alberta that it was authorized to undertake in the jurisdiction in which it was incorporated.
1999 cI‑5.1 s142
Certificate of continuance
143(1) The Lieutenant Governor in Council may, on the recommendation of the Minister, issue a certificate of continuance continuing a federally authorized company or an extra‑provincial company as a provincial company.
(2) The certificate of continuance must set out the name of the company, its financial year and whether the company is a mutual provincial company.
(3) The Lieutenant Governor in Council may set out in the certificate of continuance any term or condition that the Lieutenant Governor in Council considers advisable to deal with the particular circumstances of the company.
1999 cI‑5.1 s143
Effect of certificate of continuance
144(1) On the date set out in the certificate of continuance continuing a federally authorized company or an extra‑provincial company as a provincial company,
(a) the company becomes a provincial company as if it had been incorporated under Division 1, and
(b) the certificate of continuance is the instrument of incorporation of the continued company.
(2) A certificate of continuance is conclusive proof for the purposes of this Act and for all other purposes
(a) that the provisions of this Act in respect of continuance and all requirements precedent and incidental to continuance have been complied with, and
(b) that the provincial company has been continued under this Act on the date set out in the certificate of continuance.
1999 cI‑5.1 s144
Notice of continuance
145(1) The Minister must publish a notice of the continuance of a federally authorized company or an extra‑provincial company in The Alberta Gazette.
(2) When a federally authorized company or an extra‑provincial company is continued as a provincial company, the Minister must forthwith send a copy of the certificate of continuance to the appropriate official or public body in the jurisdiction in which the federally authorized company or extra‑provincial company was authorized to apply to be continued under this Division.
1999 cI‑5.1 s145
Effects of continuance
146 When a federally authorized company or an extra‑provincial company (referred to as the “body corporate”) is continued as a provincial company under this Division,
(a) the property of the body corporate continues to be the property of the provincial company,
(b) the provincial company continues to be liable for the obligations of the body corporate,
(c) an existing cause of action or claim by or against the body corporate or any liability of the body corporate to prosecution is unaffected,
(d) a civil, criminal or administrative action or proceeding pending by or against the body corporate may continue to be prosecuted by or against the provincial company,
(e) a conviction against or ruling, order or judgment in favour of or against the body corporate may be enforced by or against the provincial company,
(f) a person who, on the day the body corporate becomes a provincial company, was the holder of a security issued by the body corporate is not deprived of any right or privilege available to the person at that time in respect of the security or relieved of any liability in respect of the security, but any such right or privilege may be exercised only in accordance with this Act, and
(g) the bylaws of the body corporate, except those bylaws that are in conflict with this Act, continue as the bylaws of the provincial company.
1999 cI‑5.1 s146
Division 4
Continuance out of Alberta
Continuance in another jurisdiction
147(1) Subject to section 148, a provincial company may, if
(a) the proposed continuance is approved by a special resolution of the participating policyholders and shareholders, and
(b) the Minister approves the proposed continuance on being satisfied that the continuance will not adversely affect the policyholders, security holders or creditors of the company,
apply to the appropriate official or public body of another jurisdiction requesting that the company be continued in that other jurisdiction as if it had been incorporated under the laws of that other jurisdiction.
(2) The directors of the provincial company must submit the proposed continuance to a meeting of the participating policyholders and shareholders for approval.
(3) The directors must give notice of the meeting and particulars of the proposed continuance
(a) in accordance with section 270, and
(b) to the Minister at least 21 days before the meeting.
(4) The provincial company must advise the Minister if the special resolution approving the continuance is passed.
1999 cI‑5.1 s147
Requirements for other jurisdiction’s law
148 A provincial company may be continued as a body corporate under the laws of another jurisdiction only if those laws provide in effect that, if the company is continued,
(a) the property of the provincial company continues to be the property of the body corporate,
(b) the body corporate continues to be liable for the obligations of the provincial company,
(c) an existing cause of action, claim or liability to prosecution is unaffected by the continuance,
(d) a civil, criminal or administrative action or proceeding pending by or against the provincial company may continue to be prosecuted by or against the body corporate, and
(e) a conviction against or ruling, order or judgment in favour of or against the provincial company may be enforced by or against the body corporate.
1999 cI‑5.1 s148
Abandoning application
149 The directors of a provincial company may, if authorized by the participating policyholders and shareholders at the time of approving a proposed continuance under this Division, abandon the application for continuance without further approval of the participating policyholders or shareholders.
1999 cI‑5.1 s149
Certificate of discontinuance
150(1) On receipt of notice satisfactory to the Minister that the provincial company has been continued under the laws of another jurisdiction, the Minister must file the notice and issue a certificate of discontinuance, and the continued company is no longer a provincial company.
(2) The Minister must publish a notice of the certificate of discontinuance in The Alberta Gazette.
1999 cI‑5.1 s150
Division 5
Mutualization
Conversion into mutual provincial company
151(1) On the application of a provincial company, the Minister may issue a certificate converting the provincial company into a mutual provincial company.
(2) The Minister must not issue the certificate unless the requirements of the regulations have been met.
1999 cI‑5.1 s151
Regulations
152 The Lieutenant Governor in Council may make regulations respecting mutualization proposals and procedures and requirements that must be met before a provincial company may be converted into a mutual provincial company.
1999 cI‑5.1 s152
Payment
153 Despite anything in this Act, a provincial company may, with the approval of the Minister, pay for shares purchased or otherwise acquired pursuant to a mutualization proposal by
(a) making a promissory note that is, or issuing debt securities that are, payable at a fixed or determinable future time not later than 10 years after the date of its making or their issue, or
(b) issuing shares that a mutual provincial company may issue.
1999 cI‑5.1 s153
Division 6
Demutualization
Conversion into provincial company with common shares
154(1) On the application of a mutual provincial company, the Minister may issue a certificate converting the mutual provincial company into a provincial company with common shares.
(2) The Minister must not issue the certificate unless the requirements of the regulations have been met.
(3) On the day that the certificate becomes effective the policyholders of the company cease to have any rights with respect to the company as a mutual provincial company or any interest in the company as a mutual provincial company.
1999 cI‑5.1 s154
Regulations
155(1) The Lieutenant Governor in Council may make regulations
(a) respecting demutualization proposals and procedures and requirements that must be met before a mutual provincial company may be converted into a provincial company with common shares;
(b) governing the ownership of shares issued by a mutual provincial company that has been converted into a provincial company with common shares.
(2) A regulation made under this section may provide that the Minister may, by order, on such terms and conditions as the Minister considers appropriate, exempt a provincial company from prescribed requirements of that regulation.
(3) The Minister may, on such terms and conditions as the Minister considers appropriate, exempt a mutual provincial company from any requirement of this Act or the regulations if
(a) the company is applying to convert the company into a company with common shares, and
(b) the Minister is of the opinion that the company is, or is about to be, in financial difficulty and that the exemption would help to facilitate an improvement in the financial condition of the company.
1999 cI‑5.1 s155
Division 7
Change of Name, Financial Year and Terms and Conditions
Change of name and financial year
156(1) On the application of a provincial company authorized by special resolution, the Minister may issue a certificate
(a) changing the name of the company, or
(b) changing the financial year of the company.
(2) Before an application is made under subsection (1) to change the name of a provincial company, a notice of intention to make the application must be published by the applicant in The Alberta Gazette and in a newspaper in general circulation in the place where the head office of the company is located.
1999 cI‑5.1 s156
Changing terms and conditions
157 On the application of a provincial company authorized by special resolution, the Lieutenant Governor in Council may issue a certificate adding, changing or removing any term or condition that is set out in the company’s instrument of incorporation.
1999 cI‑5.1 s157
Proposal to amend
158(1) Subject to subsection (2), a director or a participating policyholder or shareholder of a provincial company may, in accordance with sections 274 and 275, make a proposal to make an application referred to in section 156 or 157.
(2) Notice of a meeting of participating policyholders or shareholders at which a proposal to amend the instrument of incorporation is to be considered must set out the proposal.
1999 cI‑5.1 s158
Division 8
Amalgamation
Amalgamation
159(1) Two or more provincial companies may amalgamate under this Division to become one provincial company.
(2) One or more provincial companies may amalgamate under this Division with one or more extra‑provincial or federally authorized companies that are licensed under this Act to become one provincial company.
(3) Despite anything in this Division, no insurer formed outside Canada may be amalgamated under this Act.
1999 cI‑5.1 s159
Amalgamation agreement
160(1) The companies proposing to amalgamate must enter into an amalgamation agreement.
(2) An amalgamation agreement does not take effect until the Minister’s approval under section 161 and the participating policyholders’ and shareholders’ approval under section 163 have been obtained.
1999 cI‑5.1 s160
Minister’s approval
161(1) Before an amalgamation agreement is submitted for participating policyholders’ and shareholders’ approval under section 163, the agreement must be submitted to the Minister for approval, and any participating policyholders’ or shareholders’ approval under section 163 is invalid if it is obtained prior to the Minister’s approval.
(2) An amalgamation agreement submitted to the Minister for approval must be accompanied with the report of an independent actuary on the agreement.
(3) The Minister must not approve the amalgamation agreement unless the Minister is satisfied that
(a) the agreement meets the requirements of the regulations,
(b) the laws of the jurisdiction in respect of each company that is proposing to amalgamate permit the proposed amalgamation, and the proposed amalgamation has obtained the approvals required under the laws of those jurisdictions, and
(c) the requirements of the regulations for amalgamation have been met.
1999 cI‑5.1 s161
Regulations
162 The Lieutenant Governor in Council may make regulations
(a) respecting the requirements for amalgamation agreements;
(b) respecting requirements that must be met before companies may be amalgamated under this Division.
1999 cI‑5.1 s162
Policyholder and shareholder approval
163(1) In this section, “company” means a company that is proposing to amalgamate under this Division.
(2) The directors of each company must submit an amalgamation agreement for approval to a meeting of the participating policyholders and shareholders of the company of which they are directors and, subject to subsection (4), to the holders of each class or series of shares.
(3) Each share of a company carries the right to vote in respect of an amalgamation whether or not it otherwise carries the right to vote.
(4) The holders of shares of a class or series of shares of a company are entitled to vote separately as a class or series in respect of an amalgamation if the amalgamation agreement contains a provision that, if contained in a proposed amendment to the bylaws or instrument of incorporation of the company, would entitle those holders to vote separately as a class or series.
(5) Participating policyholders are entitled to vote separately from shareholders in respect of an amalgamation agreement.
(6) Subject to subsections (4) and (5), an amalgamation agreement is approved when the participating policyholders and shareholders of each company have approved the amalgamation by special resolution.
(7) An amalgamation agreement may provide that, at any time before the issue of a certificate of amalgamation, the agreement may be terminated by the directors of a company even though the agreement has been approved by the participating policyholders or shareholders of all or any of the companies that are proposing to amalgamate.
1999 cI‑5.1 s163
Joint application to Minister
164(1) Subject to subsection (2), unless an amalgamation agreement is terminated in accordance with section 163(7), companies that are proposing to amalgamate must, within 3 months after the Minister approves their amalgamation agreement, jointly apply to the Minister for a certificate of amalgamation continuing the companies as one provincial company.
(2) No application for the issue of a certificate of amalgamation may be made unless
(a) notice of intention to make such an application has been published in The Alberta Gazette and in a newspaper in general circulation in the place where the head office of each applicant is located, and
(b) the application is supported by satisfactory evidence that the applicants have complied with the requirements of this Division and the regulations relating to amalgamation.
1999 cI‑5.1 s164
Certificate of amalgamation
165(1) Where an application has been made to the Minister in accordance with section 164, the Lieutenant Governor in Council may issue a certificate of amalgamation continuing the applicants as one provincial company.
(2) Section 128 applies with such modifications as the circumstances require when a certificate of amalgamation is issued pursuant to this section.
(3) The Minister must publish notice of the issuance of the certificate of amalgamation in The Alberta Gazette.
1999 cI‑5.1 s165
Effect of certificate
166(1) On the date set out in the certificate of amalgamation issued under section 165,
(a) the amalgamation of the applicants and their continuance as one provincial company are effective;
(b) the property of each applicant is the property of the amalgamated company;
(c) the amalgamated company is liable for the obligations of each applicant;
(d) any existing cause of action, claim or liability to prosecution is unaffected;
(e) any civil, criminal or administrative action or proceeding pending by or against an applicant may be prosecuted by or against the amalgamated company;
(f) any conviction against or ruling, order or judgment in favour of or against an applicant may be enforced by or against the amalgamated company;
(g) if any director or officer of an applicant continues as a director or officer of the amalgamated company, any disclosure of a material interest in any contract made to the applicant by that director or officer is deemed to be disclosure to the amalgamated company;
(h) the certificate of amalgamation is the instrument of incorporation of the amalgamated company.
(2) Any deemed disclosure under subsection (1)(g) must be recorded in the minutes of the first meeting of the directors of the amalgamated company.
1999 cI‑5.1 s166
Transitional
167(1) Despite anything in this Act or the regulations, the Minister may grant to a company in respect of which a certificate of amalgamation has been issued under this Division permission
(a) to engage in a business activity that a provincial company is not otherwise permitted by this Act to engage in and that one or more of the amalgamating companies was engaging in at the time the application for the certificate was made,
(b) to continue to have issued and outstanding debt obligations the issue of which is not authorized by this Act if the debt obligations were outstanding at the time the application for the certificate was made,
(c) to hold assets that a provincial company is not otherwise permitted by this Act to hold if the assets were held by one or more of the amalgamating companies at the time the application for the certificate was made,
(d) to acquire and hold assets that a provincial company is not otherwise permitted by this Act to acquire or hold if one or more of the amalgamating companies was obliged, at the time the application for the certificate was made, to acquire those assets, and
(e) to maintain outside Canada any records or registers required by this Act to be maintained in Canada and maintain and process, outside Canada, information and data relating to the preparation and maintenance of such records or registers.
(2) The permission granted under subsection (1) must be expressed to be granted for a specific period not exceeding
(a) with respect to any matter described in subsection (1)(a), 30 days after the date of issue of the certificate or, where the activity is conducted pursuant to an agreement existing on the date of issue of the certificate, the expiration of the agreement,
(b) with respect to any matter described in subsection (1)(b), 10 years, and
(c) with respect to any matter described in subsection (1)(c), (d) or (e), 2 years.
(3) Subject to subsection (4), the Minister may renew a permission granted under subsection (1) with respect to any matter described in subsection (1)(b), (c) or (d) for such further period or periods as the Minister considers necessary.
(4) The Minister must not grant to a provincial company any permission
(a) with respect to matters described in subsection (1)(b) that purports to be effective more than 10 years after the amalgamation became effective unless the Minister is satisfied on the basis of evidence on oath provided by an officer of the company that the company will not be able at law at the end of the 10 years to redeem the outstanding debt obligations to which the permission relates, and
(b) with respect to matters described in subsection (1)(c) and (d), that purports to be effective more than 10 years after the amalgamation became effective.
1999 cI‑5.1 s167
Notice to other jurisdiction
168 When a federally authorized company or an extra‑provincial company is amalgamated with a provincial company under this Division, the Minister must forthwith send a copy of the certificate of amalgamation to the appropriate official or public body in the jurisdiction in which the federally authorized company or extra‑provincial company was authorized to apply to be amalgamated under this Division.
1999 cI‑5.1 s168
Division 9
Provincial Company Amalgamating Under the Laws of Another Jurisdiction
Amalgamation agreement
169(1) A provincial company proposing to amalgamate with one or more companies under the laws of another jurisdiction must enter into an amalgamation agreement with the other companies.
(2) A provincial company must not proceed with an amalgamation referred to in subsection (1) unless the Minister approves the amalgamation agreement.
1999 cI‑5.1 s169
Notice of intention
170(1) Before an amalgamation agreement referred to in section 169 is made, a notice of intention to make the agreement must be published
(a) in The Alberta Gazette, and
(b) in a newspaper in general circulation in the place where the head office of the provincial company is located,
stating the date on or after which the application will be made to the Minister to approve the agreement, that date being at least 30 days after the date of publication of the notice.
(2) Where a provincial company publishes a notice referred to in subsection (1), the Minister may direct the company to provide its policyholders and shareholders with the information the Minister specifies.
(3) Where a provincial company publishes a notice referred to in subsection (1), the company must make the proposed agreement to which the notice relates available for inspection by the policyholders and shareholders of the company at the head office of the company for a period of at least 30 days after the publication of the notice and provide a copy of the agreement to any policyholder or shareholder who sends a request in writing to the head office of the company.
(4) Where the Minister is of the opinion that it is in the best interests of a group of policyholders affected by an agreement, the Minister may shorten the periods of 30 days referred to in subsections (1) and (3).
(5) The Minister may designate a professional advisor to evaluate the agreement and the provincial company that is proposing to enter into the agreement must provide any assistance required by the professional advisor to enable the advisor to complete the evaluation.
(6) The remuneration and expenses of the professional advisor for carrying out the evaluation under subsection (5) are payable by the provincial company on being approved by the Minister.
1999 cI‑5.1 s170
Participating policyholder and shareholder approval
171(1) A provincial company proposing to make an amalgamation agreement referred to in section 169 must submit the proposed agreement for approval at a meeting of the participating policyholders and shareholders and, subject to subsection (3), to the holders of each class or series of shares.
(2) Each share of the provincial company carries the right to vote in respect of a proposed agreement whether or not the share otherwise carries the right to vote.
(3) The holders of shares of a class or series of shares of a provincial company are entitled to vote separately as a class or series in respect of a proposed agreement submitted under subsection (1) if the effect of the agreement on the shares of the class or series is different from the effect on the shares of another class or series.
(4) Participating policyholders are entitled to vote separately from shareholders in respect of an agreement.
(5) For the purpose of subsection (1), and subject to subsections (3) and (4), an agreement is approved when the participating policyholders and shareholders have approved the agreement by special resolution.
1999 cI‑5.1 s171
Abandoning voting agreement