On February 2, 2012, the Ontario Superior Court of Justice ordered that Union of Canada Life cease all business operations and that its remaining assets be liquidated, having found that the insurance company had insufficient capital to ensure long-term viability.
“Union of Canada Life was faced with unique challenges that caused the company to seek court protection,” Gordon Dunning, president and CEO of Assuris, told Advisor.ca. “Our analysis indicates this company had extremely high strategic, market, and operational risks and insufficient capital to ensure the long-term viability of the company in a low interest rate environment.”
Assuris is a non-profit organization that is under a Canadian federal regulation to protect policyholders should their insurance company become insolvent. This means that Union of Canada policyholders will maintain their benefits — their policies will simply be transferred to another insurance company in good financial standing.
Grant Thornton Limited has been named as liquidator, and Assuris will be working with them to keep policyholders informed as to how their respective benefits are protected.
“The Canadian life insurance industry is very stable,” Dunning continued to Advisor.ca, “and Canada has one of the best regulatory systems monitoring financial institutions. The Financial Services Commission of Ontario (FSCO) has been closely monitoring Union of Canada Life and has kept Assuris fully informed of all developments.”
While the liquidator is arranging the transfer of policies to a new, financially viable insurance company, the remaining operations of Union of Canada Life will continue from its head office in Ottawa.
“If full recovery of policyholders’ benefits is not achieved in the transfer process, Assuris is committed to providing its protection to all policyholders.”
Union of Canada Life Insurance, founded in 1863, is one of the oldest insurance companies in Canada. They offer life and accident insurance, mortgage, and investment products, and presently operate in the province of Ontario, Québec, New Brunswick, and Prince-Edward Island.
For more information on the ordered liquidation, go to /
Source: Advisor.ca
