Echelon–Orion amalgamation and QAC reinsurance

Summary#

• This Canada Gazette notice (published September 10, 2022) contains two corporate notices about insurance companies.
• One says Orion Travel Insurance Company plans to become a federal insurer and then merge with Echelon Insurance; the other says Quebec Assurance Company plans to have some of its policies reinsured by Intact Insurance Company and to seek continuance under the Canada Business Corporations Act (CBCA).

What it does#

• For Orion Travel Insurance Company and Echelon Insurance:
  • Orion Travel Insurance Company intends to apply to continue as a federal company under the Insurance Companies Act (Canada).
  • Immediately after that continuance, the two companies plan a joint application to amalgamate into one company named Echelon Insurance / Échelon Assurance.
  • The proposed head office for the amalgamated company would be in Mississauga, Ontario.
  • The proposed effective date for the continuance and amalgamation is January 1, 2023 (or another date set in the letters patent).
  • Anyone who objects can send a written objection to the Office of the Superintendent of Financial Institutions on or before October 3, 2022.
• For Quebec Assurance Company:
  • Quebec Assurance Company intends to ask the Superintendent of Financial Institutions for approval to have Intact Insurance Company assume (reinsure) less than substantially all of its policy liabilities.
  • A copy of the proposed assumption reinsurance agreement will be available for policyholders to inspect at QAC’s head office for 30 days after the notice was published.
  • QAC also intends to apply to the Minister of Finance for approval to apply for a certificate of continuance under the Canada Business Corporations Act (CBCA) on or after September 5, 2022.
  • Policyholders or other interested persons can object to the Superintendent by email on or before September 12, 2022.
• The notices make clear that publishing the notice does not mean the approvals will be granted; the usual review process and ministerial discretion apply.

Who's affected#

• Policyholders of Quebec Assurance Company — they can inspect the proposed reinsurance agreement and may be affected if another company assumes some liabilities.
• Customers, policyholders and business partners of Echelon Insurance and Orion Travel Insurance Company — corporate structure and regulator could change if the continuance and amalgamation proceed.
• Employees and creditors of the companies may be affected by the corporate changes.
• The Office of the Superintendent of Financial Institutions and the Minister of Finance are the officials who will review and decide on these applications.
• If it’s unclear who else might be affected, the notices invite objections and provide inspection rights so interested people can learn more.

Why it matters#

• A change from a provincial to a federal insurance charter and an amalgamation can change which federal or provincial rules apply, and where legal or regulatory decisions are made.
• Reinsurance by another insurer can affect how claims are paid and who ultimately handles them. Policyholders who want to protect their interests should read the proposed agreement (for Quebec Assurance Company) and consider whether to submit an objection by the listed deadlines.
• None of these actions are final yet — they are intended applications that must still be approved by the relevant federal authorities.