Bill 92, tabled in Quebec's National Assembly, significantly alters financial sector regulations. A primary focus is the merger of the Chambre de la sécurité financière and the Chambre de l’assurance de dommages to form the Chambre de l'assurance.
The bill details the terms and conditions of this merger, aiming to streamline the oversight of life, health, and general insurance representatives.
The Minister emphasized the government's commitment to updating laws governing financial and real estate brokerage, ensuring both business agility and consumer protection.
The government seeks greater flexibility in claims adjustment services, allowing the Autorité des marchés financiers (AMF) to authorize individuals to act as adjusters even without certification, for claims exceeding $5,000. This follows recent amendments causing resignations from the Chambre de l'assurance de dommages board.
Insurance brokerage firms will be required to disclose the names of financial institutions holding over 20% of their equity, along with the names of the financial group they belong to.
On Tuesday, April 8, Finance Minister Éric Girard tabled Bill 92 in the National Assembly of Québec, amending various provisions mainly in the financial sector. In particular, he announced the merger of the two self regulatory organizations (SROs) responsible for overseeing life and health insurance and general insurance representatives.
The omnibus bill (PL-92) comprises 186 sections and amends many laws. The first chapter is entitled: Fusion de la Chambre de la sécurité financière et de la Chambre de l’assurance de dommages (Merger of the Chambre de la sécurité financière and the Chambre de l'assurance de dommages).
In the explanatory notes, the Minister states that the merger of the two SROs will create the Chambre de l'assurance. The terms and conditions of this merger comprise some forty articles.Â
In the press release announcing the tabling of PL-92, Minister Girard placed particular emphasis on the regulation of real estate brokerage. "We are committed to regularly updating the laws that govern the financial and real estate brokerage sectors. We are working closely with the players in these sectors to offer businesses the agility they need to continue evolving. At the same time, we are ensuring that Quebec consumers are adequately protected.”
Following the tabling of the bill, the Leader of the Official Opposition, Monsef Derraji, indicated that he would review it and reserve the right to request consultations.
In addition to changes to the self-regulation model for the distribution of financial products and services, the proposed amendments include the introduction of a new administrative penalty regime for financial institutions.
The government also wants to provide greater flexibility in the provision of claims adjustment services when circumstances so require. Quebec’s financial markets regulator, the Autorité des marchés financiers (AMF), will have “the power to allow certain persons to act as claims adjusters even though they do not hold a certificate authorizing them to act as such, and for a claim settlement of an amount greater than $5,000 that it determines.”
This is the second time in a year that the government has amended the law to revise the framework governing the work of claims adjusters. Following the adoption of Bill 30 in May 2024, two members of the Board of Directors of the Chambre de l'assurance de dommages resigned because of these changes.
The presence of an insurance company in the ownership of a brokerage firm is also the subject of a legislative amendment. “The bill provides that a damage insurance brokerage firm must disclose the name of the financial institution that holds an interest representing more than 20% of the firm's equity value and the name of the financial group to which it belongs, if any.”
The name of the financial group will also have to be disclosed if a legal entity related to a financial group holds an interest representing more than 20% of the value of the firm's equity.
The bill contains other measures, including a reduction in the number of members on the board of directors of the Groupement des assureurs automobiles, and the power granted to the AMF to adopt a regulation concerning the management rules applicable to a firm, independent partnership or independent representative.Â
PL-92 amends section 266 of the Insurers Act. The government wants to impose the obligation “that one-third of the directors of an insurance company reside in Quebec when the company is part of a financial group and more than 40% of the premiums are collected by the group outside Quebec, provided that the majority of the company's directors reside in Canada.”
Other provisions of PL-92 affect the provisions that created the Compensation Fund, which will now come under the Act respecting the regulation of the financial sector, so that investment brokers will be covered by the Compensation Fund.
The powers of the Tribunal administratif des marchĂ©s financiers (financial markets administrative tribunal) have also been broadened, enabling it to impose administrative penalties for breaches of a greater number of laws. New penal provisions have been added, and fines will be higher.Â
The AMF's powers to oversee the activities of persons registered under the Derivatives Act or the Securities Act are also specified. Trading platforms will also have to be recognized by the AMF in order to operate under the Securities Act.
PL-92 also includes changes to the operation of a caisse federation. The AMF will be able to inspect the federation, its security fund or a caisse that is not a member of a federation whenever it deems appropriate, instead of once a year. Another change concerns the publication of “the internal regulations of the Desjardins Cooperative Group”.
In addition, the number of mutual companies required to create a federation of mutual companies will be reduced from nine to five.Â
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