Canadian mutual property & casualty insurance firms who demutualize would not be involved in allocating benefits among mutual and non-mutual policyholders, if draft regulations published last month are implemented, a spokesperson for Economical Insurance suggests. However, there is a question as to whether those regulations “will embody the orderly and transparent process hoped for to ensure the fair and equitable treatment of all policyholders,” according to an article published by a major law firm.
Canada currently has regulations allowing for the demutualization of life insurance firms but not for property & casualty insurers.
Draft regulations for demutualization of P&C firms were published Feb. 28 in the Canada Gazette for a 30-day comment period. In its budget document for 2014-15, the ruling Conservatives had promised to “develop and consult on a proposed P&C demutualization framework that would ensure the fair and equitable treatment of policyholders and establish an orderly and transparent process for demutualizing.”
CANADIAN UNDERWRITER.CA – MARCH 25, 2015.
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