Statutes of Newfoundland and Labrador 2022 Chapter 11

Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:

RSNL1990 cL-14
as amended

1. (1) Paragraph 2(c) of the Life Insurance Act is amended by deleting the words "his or her" and substituting the words "the insured's".

(2) Paragraph 2(g) of the Act is amended by deleting the words "his or her" and substituting the words "the creditor's".

(3) Paragraph 2(h) of the Act is amended by

(a) deleting the words "his or her" and substituting the words "the insured's"; and

(b) deleting the number "1" and substituting the word "one".

(4) Section 2 of the Act is amended by adding immediately after paragraph (h) the following:

(h.1) "exempt policy" means an exempt policy as defined in the Income Tax Regulations (Canada);

(5) Paragraph 2(n) of the Act is amended by deleting the words "him or her" and substituting the words "that person".

(6) Section 2 of the Act is amended by deleting the word "and" at the end of paragraph (w), by deleting the period at the end of paragraph (x) and substituting a semi-colon, by adding the word "and" at the end of paragraph (x) and by adding immediately after that paragraph the following:

(y) "side account" means an account, associated with or part of a contract, that may hold or receive funds in excess of the maximum amount permitted to be held in an exempt policy.

2. (1) Subsection 3(1) of the Act is repealed and the following substituted:

Application of Act

3. (1) Notwithstanding an agreement, condition or stipulation to the contrary, this Act applies to any contract or side account made in this province after June 30, 1962 and, subject to subsections (2) and (3), applies to a contract made in this province before July 1, 1962.

(2) Section 3 of the Act is amended by adding immediately after subsection (1) the following:

(1.1) The Securities Act does not apply to exempt policies and side accounts which are subject to this Act.

3. Paragraph 4(b) of the Act is amended by deleting the words "he or she became" and substituting the words "of becoming".

4. Section 8 of the Act is amended by deleting the words "him or her" wherever they appear and substituting the words "the group life insured".

5. (1) Paragraph 9(2)(b) of the Act is amended by deleting the words "his or her" and substituting the words "the person's".

(2) Subsection 9(3) of the Act is amended by

(a) deleting the words "his or her" wherever they occur and substituting the words "the person's"; and

(a) deleting the number "1" and substituting the word "one".

6. Section 10 of the Act is repealed and the following substituted:

Insurable interest defined

10. Without restricting the meaning of the expression "insurable interest", a person has an insurable interest in the person's own life and in the life of

(a) the person's child or grandchild;

(b) the person's spouse;

(c) a person upon whom the person is wholly or in part dependent or from whom the person is receiving support or education;

(d) the person's employee; and

(e) a person in the duration of whose life the person has a monetary interest.

7. Paragraph 11(1)(a) of the Act is amended by deleting the words "his or her" and substituting the words "the insured's".

8. Subsection 14(1) of the Act is amended by deleting the words "his or her" and substituting the words "each of their".

9. Subsection 21(1) of the Act is amended by deleting the words "his or her" and substituting the words "the insured's".

10. Subsection 22(1) of the Act is amended by deleting the words "his or her" wherever they appear and substituting the words "the insured's".

11. Paragraph 25(1)(c) of the Act is amended by deleting the words "his or her" and substituting the words "the insured's".

12. Section 26 of the Act is repealed and the following substituted:

Right to sue

26. A beneficiary may enforce for the beneficiary's own benefit, and a trustee appointed under section 24 may enforce as trustee, the payment of insurance money made payable to the beneficiary in a contract or by a declaration and in accordance with the contract or declaration, but the insurer may set up a defence that it could have set up against the insured or the insured's personal representative.

13. (1) Paragraph 30(1)(a) of the Act is amended by deleting the words "his or her" and substituting the words "the insured's".

(2) Subsection 30(2) of the Act is amended by deleting the words "his or her" and substituting the word "each of their".

(3) Subsection 30(3) of the Act is amended by deleting the words "his or her" and substituting the words "the insured's".

14. Section 32 of the Act is repealed and the following substituted:

Group life insured enforcing rights

32. A group life insured may in the group life insured's own name enforce a right given to the group life insured under a contract, subject to a defence available to the insurer against the group life insured or against the insured.

15. Section 33 of the Act is amended by deleting the words "his or her".

16. Section 34 of the Act is amended by deleting the words "him or her" and substituting the words "the beneficiary".

17. (1) Subsection 36(3) of the Act is amended by deleting the words "his or her" and substituting the words "the person's".

(2) Subsection 36(4) of the Act is amended by deleting the words "he or she became" and substituting the words "of becoming".

18. The Act is amended by adding immediately after section 37 the following:

Amount held in contracts

37.1 (1) In this section, "actuarial basis" means the assumptions and methods generally accepted and used by fellows of the Canadian Institute of Actuaries to establish the cost of life insurance.

(2) With respect to a contract that is an exempt policy, the amount that may be held in a side account shall not exceed the lesser of

(a) the sum of

(i) the amount that would be required to pay future costs of insurance, related premium taxes and administrative fees or charges, and

(ii) any additional funds that could, in the future, be eligible to be held in the exempt policy; or

(b) the limit provided under the terms of the contract.

(3) With respect to a contract that is not an exempt policy, the amount that may be held in a contract together with an associated side account shall not exceed the amount required to pay future costs of insurance, related premium taxes and administrative fees or charges.

(4) The amounts in paragraph (2)(a) and subsection (3) shall be determined by the insurer on an actuarial basis using the remaining lifetime of the persons then insured under the contract.

(5) Any amount that exceeds the limits in subsections (2) and (3)

(a) is not a premium;

(b) is considered to have never been a premium; and

(6) This section does not apply to annuities.

(7) Notwithstanding anything in this section, where, on the day this section comes into force, a side account holds an amount of funds in excess of the maximum amount permitted under subsection (2),

(a) the amount is not required to be refunded in respect of the funds held in excess;

(b) additional funds may not be added to the account until the amount of funds held in the side account is below the maximum amount permitted under subsection (1); and

(c) once the amount of funds held in the side account is below the maximum amount permitted under subsection (1), the maximum amount permitted under subsection (1) applies in respect of the side account.

19. Section 41 of the Act is amended by deleting the words "his or her" and substituting the words "the person".

20. Section 47 of the Act is amended by deleting the words "his or her" and substituting the words "the person's".

21. Section 48 of the Act is amended by deleting the words "his or her" wherever they appear and substituting the words "the beneficiary's".

22. Subsection 52(3) of the Act is repealed and the following substituted:

(3) An order is not necessary for payment into court under subsection (1), but the public trustee shall receive the money upon the insurer filing with the public trustee an affidavit showing the amount payable and the name, date of birth and residence of the minor and upon the payment being made the insurer shall immediately notify a provincial director appointed under the Children, Youth and Families Act and deliver to the provincial director a copy of the affidavit.

23. Section 54 of the Act is amended by deleting the words "he or she" and substituting the words "the person".