MCD.INTRO Flashcards

1
Q

identify FEDERAL areas of exclusive authority (this is not specific to insurance) (6)

A
  • regulation of (trade, commerce)
  • taxation
  • banking
  • (bankruptcy, insolvency)
  • aliens & naturalization
  • criminal law
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2
Q

identify PROVINCIAL areas of exclusive authority (this is not specific to insurance) (4)

A
  • provincial taxes
  • civil property rights
  • hiring & supervising provincial employees
  • operating jails & hospitals
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3
Q

define intra vires, ultra vires

A

INTRA VIRES: within the powers of a particular Govt
ULTRA VIRES: beyond the powers of a particular Govt

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4
Q

Citizens Ins v Parsons (arson!!!)

A

FACTS: insurer disuptes ON’s Fire Insurance Act
- the Act required certain statutory conditions for fire policies in ON

ISSUE 1: is ON Fire Act ULTRA VIRES? (relates to regulation of trade, which is federal)

ISSUE 2: insurer claims province can’t legislate to deprive federally incorporated insurer of status & capacity

Ruling (Issue 1):
- ON Fire Act is INTRA VIRES
Reason:
- federal government can’t regulate an insurer operating in a single province
- such insurance contracts are INTRA-provincial and are not covered by federal trade regulations
- trade means INTER-provincial (not INTRA-provincial)

Ruling (Issue 2)
- status & capacity UNAFFECTED
- insurers are all treated equally, regardless of where they were incorporated

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5
Q

Insurance Reference Case: AG(Can) v AG(AB)

A

FACTS: The Federal Insurance Act required a Federal license of all insurers..
..EXCEPT IF (incorporated by Province) AND (operating solely in Province)

ISSUE: is this ultra-vires of the federal government

RULING (JCPC):
- licensing provisions are ‘ultra vires’:
- regulation of trade/commerce didn’t extend to a licensing system of a particular trade
- trespasses on Provincial authority in civil rights
(not covered by Federal power to legislate for Peace, Order, Good Government)

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6
Q

Implications of the ruling of the insurance reference case (3)

A
  • a provincial insurer has the capacity, but not the right to operate in another Province
    (need permission from other province)
  • federal insurer has the capacity and the right to operate in another province
  • federal government can require a federal license for a foreign insurer
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7
Q

BC Public Auto: CIC v AG(BC)

A

FATCS: BC legislature establishes compulsory public auto insurance plan
- legislature refuses license renewal of private insurers
- insurers sue

ARGUMENTS:
- insurers claimed BC legislation is ULTRA VIRES for 2 reasons:
- it relates to regulation of trade, which is federal
- province can’t legislate to deprive federally incorporated insurer of status &capacity

RULING: BC legislature acted within its powers (legislation is INTRA VIRES)

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8
Q

identify of examples FEDERAL regulation/legislation regarding insurer solvency (5)

A
  • CONDITIONS for entering business
  • INVESTMENTS
  • regular REPORTING
  • CALCULATION of assets & reserves
  • PROTECT policy holders
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9
Q

areas & matters under PROVINCIAL insurance legislation/regulation

A

CONTRACT MATTERS: (ppp-ird)
- (policy contents), (policy terms), (premium payment), (insurable interest), (reinstatement), (designation of beneficiaries)..
TRANSACTION MATTERS: (AUC)
- (Agent licensing), (Unfair practices), (Claims handling)

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10
Q

OSFI licensing requirements for domestic insurers (for Minister of Finance to approve letters patent) (6)

A
  • financial resources (must be sufficient)
  • business plan (detailed & realistic)
  • business record of applicants (check for past bankrupticies)
  • (character, competence, experience) of management
  • positive effect on Canadian financial system (jobs, GDP growth)
  • if owned by a foreign parent, OSFI must be satisfied that subsidiary will be treated fairly
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11
Q
A
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