Echelon and Orion Amalgamation; Quebec Assurance Reinsurance

Summary#

Two insurance-related notices appeared in the Canada Gazette. One says Echelon Insurance and Orion Travel Insurance Company plan to combine and operate as a single company beginning January 1, 2023 (subject to approval). The other says Quebec Assurance Company plans to transfer some of its policies to Intact Insurance Company and to change its corporate charter under the Canada Business Corporations Act, with key application and objection dates in September 2022.

What it does#

• For Echelon Insurance and Orion Travel Insurance Company:

  • Orion Travel Insurance Company intends to continue under the Insurance Companies Act (Canada) and then immediately merge with Echelon Insurance into one company called Echelon Insurance / Échelon Assurance.
  • The merged company’s head office would be in Mississauga, Ontario.
  • The proposed effective date is January 1, 2023. Objections could be sent to the Office of the Superintendent of Financial Institutions by October 3, 2022.

• For Quebec Assurance Company:

  • Quebec Assurance Company plans to be reinsured, on an assumption basis, by Intact Insurance Company for less than all of its policy liabilities.
  • A copy of the proposed reinsurance agreement was made available for policyholders to inspect at QAC’s Toronto head office for 30 days after the notice.
  • QAC also plans to apply to the Minister of Finance for a certificate of continuance under the Canada Business Corporations Act. That application was to be made on or after September 5, 2022.
  • Policyholders or other persons could object to the continuance to the Office of the Superintendent of Financial Institutions by September 12, 2022. The proposed reinsurance application to the Superintendent was to be made on or after September 20, 2022.

Who's affected#

• Policyholders of Echelon Insurance, Orion Travel Insurance Company, and Quebec Assurance Company. They are most likely to see any practical changes in who handles their claims or who they deal with for renewals and service.
• Employees, agents, brokers, and business partners of those insurers, because corporate structure and administrative arrangements may change.
• The notices also matter to anyone who wants to file an objection by the listed deadlines. If you are unsure whether you’re affected, the documents say policyholders can inspect the proposed reinsurance agreement or contact the regulator for information.

Why it matters#

• Mergers and continuances change who owns and runs an insurance company and where it is based. That can affect customer service, claims handling, and which company is responsible for policies.
• An assumption reinsurance means another insurer (Intact Insurance Company) would take on some of Quebec Assurance Company’s policy obligations. That can affect who pays claims in the future.
• These changes require approval from federal regulators (the Office of the Superintendent of Financial Institutions and the Minister of Finance). The notices give policyholders a chance to see agreements and raise objections by the listed dates. The notices do not guarantee the changes will be approved.