Ontario is introducing a number of new regulations and amendments to its Insurance Act.
In a bulletin published on Jan. 6, the Financial Services Commission of Ontario (FSCO) noted that various amendments related to both life insurance and accident and sickness insurance are scheduled to come into effect on July 1, 2016, as are a number of new regulations.
"Affecting both individual and group insurance, the changes are aimed at modernizing key provisions dealing with: policy issuance; disclosure and related matters; providing greater consumer flexibility and protection; and harmonizing the law with other Canadian jurisdictions," reads the bulletin.
Provisions governing misrepresentation and incontestability are being changed, as are reinstatement provisions for life insurance policies. As far as group insurance is concerned, the new rules provide for the continuation of coverage where a group contract is terminated, and the list of particulars that must be disclosed in a group certificate has also been expanded.
In an accompanying list of frequently asked questions, the regulator outlined some of the ways that consumers will benefit from the new rules:
- The insurer will have to provide the insured or a claimant a copy of the insured’s application (and any relevant written statements or other records) and, upon request, a copy of the entire contract.
- There will be a new grace period of 30 days, during which the insured may make overdue insurance premium payments (with some restrictions) in order to reinstate a lapsed policy.
- Individuals whose lives and/or well-being are insured under a contract, but who are not the insured policyholder(s), will now have the option to apply to the court to terminate or reduce this insurance, if they reasonably believe their lives or health might be endangered by the insurance.
- When an insured person dies, the insurance money can now be paid to the deceased person’s personal representative, if the deceased person did not live in Ontario when he/she died.
"Insurance companies in Ontario are being informed about these amendments six months in advance, so that they have sufficient time to revise their insurance contracts, and inform their staff and insurance agents about these changes," says FSCO.