The federal government recently passed a law allowing La Capitale Financial Security Insurance Company to apply to be regulated under the laws of Quebec.
Bill S-1001 – which was signed into law June 17 – is “a private bill requested by a private insurance company to allow it to apply to change from being a federally regulated insurance company to being a provincially regulated, in this case Quebec-regulated, insurance company,” said Senator Dennis Dawson during a session May 19.
Dawson, a Quebec Liberal Senator, noted there were “no provisions authorizing an insurance company governed by the Insurance Companies Act of Canada to be continued under the laws of the province.”
La Capitale Financial – federally incorporated in 1993 under the Insurance Companies Act – was originally known as Penncorp Life Insurance Company, Dawson told the senate.
“Its name was changed to the La Capitale Financial Security Insurance Company in 2014, and its principal business activity is the City of Mississauga, Ontario,” Dawson said. “For a corporation to cease being governed under a federal charter to receive a provincial charter, federal legislation has to be passed in the form of a private bill because the Insurance Companies Act of Canada does not contain any provisions for the transfer of a corporation from a federal charter to a provincial charter.”
The parent company – Quebec City-based La Capitale Financial Group – also owns property & casualty insurers La Capitale General Insurance, Mississauga-based Unica Insurance Inc. and L’Unique General Insurance.
Unica was known as York Fire & Casualty Insurance Company before York Fire was sold by Kingsway Financial Services Inc., in 2008, to La Capitale.
Bill S-1001 was originally tabled May 12, passed third reading in the Senate June 10 and third reading in the House of Commons June 16.
“This bill does not set a precedent,” Dawson told the Senate May 19. “Since 1994, five such initiatives have been taken by life insurance companies that have moved from federal charters to provincial charters in the Province of Quebec. The first was Bill S-3 in 1994, followed by Bill S-27 and Bill S-28, both of which were passed in 2001. In 2011, we had Bill S-1002, and in 2012, Bill S-1003.”