Definity capital cut; NAS branch; UFSC continuance

Summary#

This Canada Gazette page carries three notices about insurance companies and a fraternal society. It says Definity Insurance Company plans to reduce the stated capital of its common shares by up to $400,000,000; North American Specialty Insurance Company plans to apply to open a Canadian branch; and UFSC Heritage Life Insurance Fraternal Society plans to seek a change so it can continue under the Canada Not-for-profit Corporations Act.

What it does#

• Definity Insurance Company

  • Announces an intention to apply to the regulator under the Insurance Companies Act (Canada) to reduce the stated capital of its common shares.
  • The reduction would be up to $400,000,000 in total and could be paid to the company’s sole shareholder in one or more payments on or before March 31, 2022.
  • The special resolution approving this was passed by the sole shareholder on January 28, 2022.

• North American Specialty Insurance Company

  • Says it will file an application on or after February 21, 2022 to establish a Canadian branch and to be allowed to insure risks in many classes (property, automobile, marine, liability, surety, etc.).
  • The company’s head office is in Kansas City, Missouri; its planned Canadian chief agency would be in Toronto, Ontario.
  • It says Westport Insurance Corporation currently operates in Canada and that Westport’s Canadian branch operations would be moved to the proposed branch of NAS if regulators approve.
  • It also says the company intends to change its name to Swiss Re Corporate Solutions America Insurance Corporation, subject to U.S. regulatory approval.

• UFSC Heritage Life Insurance Fraternal Society

  • Announces an intention to apply to the Minister of Finance (Canada) on or after March 15, 2022 for approval to apply under the Canada Not-for-profit Corporations Act for a certificate of continuance.
  • If approved, the society would change its legal name to UFSC Heritage Life Association.
  • The notice invites objections to the discontinuance from the Insurance Companies Act (Canada) to be sent to the Superintendent of Financial Institutions (Canada) by March 15, 2022.

Who's affected#

• The sole shareholder of Definity Insurance Company (explicit beneficiary of the planned distribution).
• Policyholders, brokers, and employees connected to Westport Insurance Corporation and the proposed North American Specialty Insurance Company Canadian branch — especially those dealing with the listed classes of insurance.
• Members and stakeholders of UFSC Heritage Life Insurance Fraternal Society, who may be affected by the change of corporate status and name.
• Regulators: Superintendent of Financial Institutions (Canada) and Minister of Finance (Canada), who will receive and review the applications.
• It is not always clear from the notices how existing policy terms, claims handling, or consumer protections would change if the applications are approved.

Why it matters#

• A reduction of stated capital of up to $400,000,000 at Definity means a large payment to its shareholder is planned; regulators must approve that move, and it can affect the company’s reported capital position.
• The proposed Canadian branch of North American Specialty Insurance Company could change which legal entity issues and services certain insurance policies in Canada, and it may lead to a rebrand to Swiss Re Corporate Solutions America Insurance Corporation.
• The planned continuance of UFSC under the Canada Not-for-profit Corporations Act would move the society out from under the Insurance Companies Act (Canada) framework, which may change how it is governed and regulated. Members and others should watch for any practical changes to coverage, governance, or where to send objections or questions.
• All three items are notices of intent or planned applications — none are final until the relevant regulators approve them.