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RSNL1990 CHAPTER I-9

INSURANCE ADJUSTERS, AGENTS AND BROKERS ACT

Amended:

1992 c.13 s.1; 1993 c.24; 1996 cR-10.1 s37; 1996 c35; 2001 c42 s22; 2004 c36 s19; 2005 cF-9.1 s14; 2008 cF-11.01 s39; 2010 c15 ss9-12; 2010 c17; 2013 c20

CHAPTER I-9

AN ACT RESPECTING INSURANCE ADJUSTERS, AGENTS AND BROKERS

Analysis


       
1.   Short title

       
2.   Definitions

       
3.   Non-application of Act

       
4.   Licence

       
5.   Qualifications and requirements

       
6.   Conditions, etc. of licence

       
7.   Transferring services

       
8.   Students

       
9.   Corporate licences

     
10.   Company or partnership dissolved

     
11.   Rep. by 1993 c24 s4

     
12.   Duration of licence

     
13.   Prohibition re licences

     
14.   Confusion of names

     
15.   Power to revoke, etc. a licence

     
16.   One year waiting period

     
17.   Notification of suspension, etc.

     
18.   Rep. by 2005 cF-9.1 s14

     
19.   Record of licences

     
20.   Advisory board

     
21.   Over-insurance

     
22.   Where name of insurer disclosed

     
23.   Confidentiality

     
24.   Special licence

     
25.   Unlicensed insurers

     
26.   Insurers responsible

     
27.   Life insurance agents, brokers and representatives

     
28.   Prohibition

     
29.   Payments of premium

     
30.   Trust funds

   
30.1   Exemption from S.30

     
31.   Trust funds paid to insurer

     
32.   Lien on policy

     
33.   Statement of financial affairs

     
34.   Insurers annual return

     
35.   Records audited

     
36.   Re holding out

     
37.   Collectors of life and accident insurance premiums

     
38.   Fraternal or sororal societies, etc.

     
39.   Payment of bonus, etc. to insurer's employees

     
40.   Privileged information

     
41.   Incapacity

     
42.   Superintendent's inquiries

     
43.   Investigations

 
43.01   Powers

 
43.02   Production order

   
43.1   Order for compliance

   
43.2   Property held in trust

     
44.   Regulations

   
44.1   Fees and forms

     
45.   Offence

     
46.   Penalty

     
47.   Limitation

     
48.   RSN1970 c176 Amdt.

     
49.   RSN1970 cc.175 and 204 Rep.

     
50.   Commencement


Short title

        1. This Act may be cited as the Insurance Adjusters, Agents and Brokers Act .

1986 c36 s1

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Definitions

        2. In this Act

             (a)  "accident and sickness insurance" means accident and sickness insurance as defined in the Insurance Companies Act ;

             (b)  [Rep. by 2010 c15 s9]

             (c)  "adjuster" means a natural person who,

                      (i)  for compensation or otherwise, directly or indirectly solicits the right to investigate a loss, assess damages, negotiate the settlement of a resultant claim for an insurer, self-insurer, claimant or insured under a contract of insurance or surety insurance or assumed liability instead of those contracts,

                     (ii)  for compensation or otherwise, holds himself or herself out to a claimant or an insured as an adjuster, investigator, consultant, or adviser with respect to the settlement of losses or claims referred to in subparagraph (i),

                    (iii)  for compensation or otherwise, in direct contact with a claimant or an insured, holds himself or herself out as an adjuster, assessor, investigator, consultant or adviser with respect to the settlement of losses or claims referred to in subparagraph (i), or

                    (iv)  for compensation or otherwise, in direct contact with a claimant or an insured, investigates a loss, assesses damage, negotiates the settlement for losses or claims referred to in subparagraph (i)

but does not include a person referred to in section 3;

             (d)  "adjustment company" means a corporation or partnership licensed to carry on the business of an adjuster under this Act, but does not include an insurer;

             (e)  "advisory board" means the board appointed to assist and advise the superintendent under section 20;

              (f)  "agent" means a corporation or partnership

                      (i)  which, for compensation, solicits insurance on behalf of an insurer or transmits, for a person other than itself, an application for or a policy of insurance to or from the insurer or offers or assumes to act in the negotiation of insurance or in negotiating its continuance or renewal, or

                     (ii)  which holds itself out as an insurance consultant or examines, appraises, reviews or evaluates an insurance policy, plan or program or makes recommendations or gives advice with regard to any of the above;

             (g)  [Rep. by 2005 cF-9.1 s14]

             (h)  "broker" means a corporation or partnership, other than an agent, which for compensation with respect to persons or property in the province, deals directly with the public and

                      (i)  acts or helps in soliciting, negotiating or procuring the making of a contract of insurance whether or not it has arrangements with insurers allowing it to bind coverage and countersign insurance documents on behalf of insurers,

                     (ii)  provides risk management services including claims assistance where required to a corporation other than itself, or

                    (iii)  holds itself out as an insurance consultant or examines, appraises, reviews or evaluates an insurance policy, plan or program or makes recommendations or gives advice with regard to any of the above;

              (i)  "claimant" means a person other than an insured to whom money may be payable under a contract;

              (j)  "compensation" includes a promise of or intention to or hope of or expectation of obtaining a commission, fee, bonus, salary or a direct benefit;

             (k)  "contract" means a contract of insurance and includes a policy, certificate, interim receipt, renewal receipt or writing evidencing the contract, whether sealed or not, and a binding oral agreement;

              (l)  [Rep. by 2010 c15 s9]

            (m)  [Rep. by 2010 c15 s9]

             (n)  [Rep. by 2010 c15 s9]

             (o)  "insurance" means the undertaking by a person to indemnify another person against loss or liability for loss in respect of a certain risk or peril to which the object of the insurance may be exposed, or to pay a sum of money or other thing of value upon the happening of a certain event, and includes life insurance;

             (p)  "insured" means a person insured by a contract whether named or not;

             (q)  "insurer" means a person who undertakes or agrees or offers to undertake a contract;

              (r)  "licence" means an adjuster's licence, adjustment company's licence, agent's licence, broker's licence, representative's licence, student's licence or a class of licence that may be prescribed which has been issued under this Act or the regulations and which has not been suspended, revoked or cancelled by the superintendent;

             (s)  "licensee" means a person to whom a licence has been issued under this Act and the regulations;

              (t)  "life insurance" means life insurance as defined in the Insurance Companies Act ;

             (u)  "life insurer" means a corporation licensed to transact the business of life insurance or annuities under the Insurance Companies Act ;

          (u.1)  "minister" means the minister appointed under the Executive Council Act to administer this Act;

             (v)  "non-resident" means

                      (i)  an individual not ordinarily resident in the province, or

                     (ii)  a partnership or corporation whose principal place of business is located outside the province and does not maintain an office in the province;

            (w)  "policy" means the instrument evidencing a contract;

             (x)  "representative" means

                      (i)  a person who under authority conferred by an insurer, agent or broker, for compensation or commission or other thing of value solicits insurance on behalf of the person conferring that authority, or transmits, for a person other than that person, an application for or policy of insurance, to or from an insurer or the person conferring that authority, or offers or assumes to act on behalf of the person conferring that authority, in the negotiation of a policy of insurance or in negotiation of its continuance or renewal, or

                     (ii)  a person who holds out as an insurance consultant or examines, appraises, reviews or evaluates an insurance policy, plan or program or makes recommendations or gives advice with regard to any of the above;

             (y)  "self insurer" means an individual, partnership or corporation which retains all or part of a risk for its own account whether or not an excess of loss cover exists to protect itself in the event of a catastrophe;

             (z)  "sponsor" means a person who

                      (i)  recommends that an applicant is suitable for a licence under this Act,

                     (ii)  acknowledges directly or indirectly that an agent-principal or employer-employee relationship exists between that person and an applicant, or

                    (iii)  recommends an applicant and acknowledges that a relationship exists under subparagraph (ii);

           (aa)  "student" means a natural person who is studying to become qualified as an adjuster or representative;

          (bb)  "superintendent" means the Superintendent of Insurance appointed in the manner authorized by law; and

           (cc)  "surety bond" means a guarantee of the performance of an expressed obligation; and

          (dd)  "surety insurance" means surety insurance as defined in the Insurance Companies Act .

1986 c36 s2; 1989 c19 Sch B; 1993 c24 s1; 1996 c35 s35; 2001 c42 s22; 2005 cF-9.1 s14; 2010 c15 s9

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Non-application of Act

        3. The provisions of this Act relating to adjusters and adjustment companies do not apply to

             (a)  a barrister or solicitor who is practising in the province and who is acting in the usual course of his or her profession;

             (b)  a liquidator or trustee in bankruptcy, in the performance of his or her duties;

             (c)  a testamentary executor, director, trustee or fiduciary, in the performance of his or her duties;

             (d)  a person who is employed as an appraiser, engineer or other expert who is employed solely for the purpose of giving expert advice or evidence;

             (e)  members of a police force, fire department or fire commissioner's office in the performance of their duties; and

              (f)  those classes of insurance, persons or claims exempted by the regulations.

1986 c36 s3

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Licence

        4. (1) The superintendent may, where a person pays the prescribed fee, issue a licence to that person.

             (2)  A person applying for a licence shall file with the superintendent a written application in the prescribed form.

1986 c36 s4; 1996 c35 s36

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Qualifications and requirements

        5. (1) A person applying for a licence and a licensee are subject to the qualifications and requirements for licensing set out in this Act and the regulations.

             (2)  Where the superintendent is not satisfied or it appears to the superintendent that the person applying for a licence or the licensee is not a suitable person to exercise the rights and privileges of a holder of a licence, the superintendent may refuse to issue a licence to or may revoke the licence of that person.

             (3)  A natural person who on the date of the coming into force of this Act was carrying on business and had been carrying on business for a number of years as may be prescribed and does not meet the educational requirements set out in the regulations may apply to the superintendent and has the right to obtain from the superintendent a licence under this Act where the application is accompanied by the prescribed fee and the other requirements of the regulations.

             (4)  Every licensee shall be covered by a policy of insurance against liability in respect of an occurrence with regard to errors and omissions, and other insurance, in the amounts that may be prescribed by the regulations.

1986 c36 s5; 1993 c24 s2; 2010 c15 s10

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Conditions, etc. of licence

        6. The superintendent may attach to a licence those restrictions, limitations or conditions the superintendent considers appropriate.

1986 c36 s6

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Transferring services

        7. (1) An adjuster or representative who transfers his or her services from one sponsor to another shall immediately notify the superintendent, and the sponsor, adjuster or representative shall immediately return the licence to the superintendent, who may cancel the licence.

             (2)  If the superintendent is satisfied with the transfer and the adjuster or representative meets the qualifications and requirements for licensing set out in this Act and the regulations, the superintendent may issue another licence to that adjuster or representative.

             (3)  Where an adjuster or representative ceases to be sponsored by the sponsor whose name is specified in his or her licence, the licence of the adjuster or representative is considered to be suspended for the purposes of this Act, and the sponsor, adjuster or representative shall immediately return the licence to the superintendent, who may cancel that licence.

             (4)  The superintendent may issue another licence to that adjuster or representative where the adjuster or representative meets the qualifications and requirements for licensing set out in this Act and the regulations.

1996 c35 s37

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Students

        8. (1) An adjuster, adjustment company, representative, insurer, agent or broker shall not employ as a student adjuster or student representative, a person who does not hold a prescribed licence.

             (2)  A student may be employed by only 1 adjuster, adjustment company, representative, insurer, agent or broker,

             (a)  who shall sponsor the student's application for a licence; and

             (b)  whose name shall be specified on the student's licence.

             (3)  A student who transfers his or her services from one sponsor to another shall immediately notify the superintendent and the student or sponsor whose name is on the student's licence shall immediately return the licence to the superintendent, who may cancel the licence.

             (4)  If the superintendent is satisfied with the transfer and the student meets the qualifications and requirements for licensing set out in this Act and the regulations, the superintendent may issue another licence to that student.

             (5)  Where a student ceases to be sponsored by the sponsor whose name is specified in his or her licence, the licence of the adjuster or representative is considered to be suspended for the purposes of this Act, and the student or sponsor whose name is on the student's licence shall immediately return the licence to the superintendent, who may cancel that licence.

             (6)  The superintendent may issue another licence to that student where the student meets the qualifications and requirements for licensing set out in this Act and the regulations.

1986 c36 s8; 1993 c24 s3; 1996 c35 s38

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Corporate licences

        9. (1) A partnership or corporation may, in accordance with this Act, apply for an adjustment company licence, an agent's licence or a broker's licence.

             (2)  All officers, partners or employees who act under an adjustment company's licence, an agent's licence or a broker's licence shall be individually licensed.

             (3)  An adjustment company licence, an agent's licence or a broker's licence may be issued to a corporation that is incorporated expressly for the purpose of acting as an adjustment company, agent or broker or for that and those purposes that the superintendent expressly approves of and where the corporation has been incorporated under the Corporations Act , the articles of incorporation shall have been approved by the superintendent before incorporation.

1986 c36 s9

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Company or partnership dissolved

      10. (1) Where a partnership licensed as an adjustment company, agent or broker is dissolved or otherwise terminated, the partnership shall immediately notify in writing the superintendent who shall revoke the licence and the partnership shall immediately return the licence to the superintendent.

             (2)  Where a corporation, which has been licensed under this Act, is dissolved or wound up or its charter is cancelled, the corporation by its principal officers, the liquidator or trustee shall within a reasonable time notify in writing the superintendent who shall revoke the licence and the corporation shall return the licence to the superintendent.

             (3)  Where a corporation which has been licensed under this Act ceases doing business in the province the corporation by its principal officers shall within a reasonable period of time notify in writing the superintendent and shall return the licence to the superintendent who may cancel the licence.

1996 c35 s39

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Rep. by 1993 c24 s4

      11. [Rep. by 1993 c24 s4]

1993 c24 s4

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Duration of licence

      12. (1) A licence remains in effect, subject to the filing of annual reports and payment of an annual fee as prescribed by the minister, and subject to the qualifications and the requirements of the Act and regulations until it is suspended, revoked or cancelled under this Act.

             (2)  The superintendent may issue a licence for a period of time the superintendent considers appropriate.

1996 c35 s40

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Prohibition re licences

      13. (1) The superintendent shall not issue an adjuster's licence to a licensed representative or student representative.

             (2)  The superintendent shall not issue a representative's, agent's or broker's licence to a licensed adjuster or adjustment company or its employees.

1986 c36 s13; 1993 c24 s5

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Confusion of names

      14. (1) The superintendent shall refuse to issue a licence to an adjuster, adjustment company, an agent or broker in a name that is likely to be confused with that of another adjuster, adjustment company, agent or broker.

             (2)  An adjuster, adjustment company, representative, agent or broker shall not identify himself, herself or itself by a name other than that specified by the licence issued to him, her or it.

1986 c36 s14

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Power to revoke, etc. a licence

      15. The superintendent may revoke, suspend or cancel a licence issued under this Act, where, after investigation, the superintendent determines that the licensee has contravened this Act or the regulations.

1986 c36 s15; 1996 c35 s41

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One year waiting period

      16. The superintendent shall not issue a licence to an individual, partnership or corporation whose licence has been revoked until at least 1 year after the date of revocation and unless that individual, partnership or corporation complies with the qualifications for licensing under this Act and the regulations.

1986 c36 s16

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Notification of suspension, etc.

      17. (1) Where the superintendent refuses to issue a licence or suspends or revokes a licence, the superintendent shall in writing notify the applicant whose application the superintendent has refused or the licensee whose licence the superintendent has suspended or revoked and state the reason for the refusal, suspension or revocation.

             (2)  Notification of refusal, suspension or revocation under subsection (1) shall be delivered by registered mail and the action shall take effect 15 days after notice is received at the post office to which it is addressed.

             (3)  Where the superintendent refuses to issue a licence or suspends, revokes or amends a licence the person aggrieved by that refusal, suspension, revocation or amendment decision may, in accordance with the Financial Services Appeal Board Act , appeal that decision to the board established under that Act.

1986 c36 s17; 2005 cF-9.1 s14

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Rep. by 2005 cF-9.1 s14

      18. [Rep. by 2005 cF-9.1 s14]

2005 cF-9.1 s14

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Record of licences

      19. (1) The superintendent shall keep a record of licences that the superintendent issues.

             (2)  The record referred to in subsection (1) shall at reasonable times be open for inspection on payment of the prescribed fee.

             (3)  A copy of the record referred to in this section may be provided by the superintendent upon the payment of the prescribed fee for providing the copy.

             (4)  The superintendent may publish from time to time a list of persons to whom licences have been issued or whose licences have been cancelled, suspended or revoked.

1986 c36 s19; 1996 c35 s43

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Advisory board

      20. (1) The superintendent may appoint an advisory board consisting of not more than 7 persons.

             (2)  The advisory board shall meet when the superintendent considers necessary and make those reports and recommendations that it considers appropriate.

             (3)  The superintendent is not bound by and may disregard a report, recommendation or advice of the advisory board and nothing in this section limits, abridges, impairs or derogates from the powers and duties conferred or imposed upon the superintendent by this or another Act.

             (4)  The superintendent or the person who represents the superintendent is the chairperson of the advisory board.

1986 c36 s20

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Over-insurance

      21. An adjuster who in adjusting a loss of or damage to property by fire, finds that there is over-insurance upon the property or finds that there are circumstances which indicate that there is over-insurance upon the property, shall report his or her findings in writing to the Provincial Fire Commissioner appointed under the Fire Protection Services Act and to the superintendent, together with information on circumstances which indicate that an offence may have been committed against the laws of the province or those of Canada.

1986 c36 s21; 2008 cF-11.01 s39

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Where name of insurer disclosed

      22. Where an adjuster on behalf of an insurer, enters into negotiations with a person having a claim against an insured for which indemnity is provided by the insurer, the adjuster shall, where requested, disclose to the claimant the name and address of the insurer.

1986 c36 s22

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Confidentiality

      23. (1) Unless required to do so by law, an adjuster and the employees of an adjustment company shall not disclose to a person other than their employer or principal, without the authorization of the employer or principal, information obtained in the course of their duties.

             (2)  Nothing in subsection (1) shall prevent the superintendent or the superintendent's representative from having access to those books, files or other records that are necessary to investigate criminal or non-criminal complaints against

             (a)  the adjuster;

             (b)  the principal or employer of the adjuster;

             (c)  the adjustment company; or

             (d)  the principal or employer of the adjustment company.

1986 c36 s23

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Special licence

      24. (1) The superintendent may, on the payment of the prescribed fee issue a special licence to a suitable corporation or partnership to act as a special insurance broker to negotiate, continue or renew contracts of insurance in the province with insurers not authorized to transact that business in the province.

             (2)  An applicant for a special licence under this section shall file with the superintendent a written application on the prescribed form.

             (3)  Where the superintendent is satisfied with the statements and information provided, the superintendent may issue a special licence, subject to suspension or revocation at the discretion of the superintendent.

             (4)  [Rep. by 1996 c35 s44]

             (5)  A corporation or partnership shall, before receiving a special licence, execute and deliver to the superintendent security to the satisfaction of the superintendent in the prescribed sum that that corporation or partnership will faithfully comply with all the requirements of this Act and the regulations.

             (6)  A corporation or partnership licensed under this section shall pay to the Department of Finance the taxes that would be payable if the premiums had been received by a licensed insurer.

             (7)  Where it is shown to the satisfaction of the superintendent that all insurance effected under this section is no longer in force or has been reinsured, the corporation or partnership that is licensed is entitled to a release or cancellation of the security.

             (8)  [Rep. by 1993 c24 s6]

             (9)  A corporation or partnership which contravenes this section forfeits the special licence issued to that corporation or partnership and is guilty of an offence and the licence shall be referred immediately to the superintendent who shall cancel it.

1986 c36 s24; 1993 c24 s6; 1996 c35 s43

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Unlicensed insurers

      25. (1) An agent, broker or representative is liable to the insured on all contracts of insurance unlawfully made through the agent, broker or representative directly or indirectly with an insurer not licensed to undertake insurance in the province in the same manner as if that agent, broker or representative were the insurer.

             (2)  A corporation or partnership shall not place a contract with an unlicensed insurer unless that corporation or partnership has obtained a licence under section 24 and complies with subsection (4).

             (3)  Where sufficient insurance in respect of a matter or thing in the province cannot be obtained from insurers licensed in the province, a corporation or partnership licensed under section 24 may effect insurance with an unlicensed insurer where that corporation or partnership complies with subsection (4).

             (4)  Where sufficient insurance cannot be obtained from an insurer licensed in the province, the agent, broker or representative shall obtain from the insured an executed and dated declaration including:

             (a)  a full description of the nature of the insurance;

             (b)  the amount of insurance required;

             (c)  a statement that the insurance cannot be obtained from licensed insurers; and

             (d)  a statement that application for the insurance was previously made to and refused by named insurers licensed in the province.

1986 c36 s25

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Insurers responsible

      26. (1) A sponsor who sponsors the application for a licence of an agent, broker or representative accepts responsibility for actions of the agent, broker or representative relating to all applications for insurance submitted to the insurer and all contracts of insurance issued as a result of those applications.

             (2)  An insurer by its acceptance of an application for insurance from an agent, broker or representative whose application for licence was sponsored by another insurer accepts responsibility for the actions of the agent, broker or representative relating to the application submitted on a policy which may be issued as a result of that application.

             (3)  Nothing in this section shall prejudice the agent-principal relationship between an insured and a broker, agent or representative.

1986 c36 s26

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Life insurance agents, brokers and representatives

      27. (1) A licensed agent, broker or representative holding a licence to write life insurance shall not

             (a)  act as an agent, broker or representative for more than 1 life insurer; or

             (b)  hold out to the public by advertisement or otherwise that the licensee is the agent, broker or representative of more than 1 life insurer.

             (2)  Where a licensee holding a licence to write life insurance is unable to negotiate life insurance on behalf of an applicant with the insurer which sponsors the licensee, the licensee may obtain the life insurance from another insurer where that other insurer obtains, in each case, the written consent of the insurer which sponsors the licensee and files a copy of that consent with the superintendent.

             (3)  Subsections (1) and (2) do not apply to an agent, broker or representative who has held a licence to write life insurance for at least 3 consecutive years.

             (4)  Subsection (2) does not apply to an agent, broker or representative who represents an insurer that is, in the opinion of the superintendent, affiliated or associated with or is a member of a group of companies sharing common ownership with the insurer that sponsors the agent's, broker's or representative's application for a licence.

             (5)  The insurer referred to in subsection (4) shall be specified in the licence of the agent, broker or representative, in addition to the insurer who sponsors the agent's, broker's or representative's application for licence, in a manner determined by the superintendent.

1986 c36 s27

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Prohibition

      28. (1) An insurer or its officers, agents, brokers, representatives or employees shall not pay or allow compensation or anything of value for an application of insurance to

             (a)  a person who without a licence and in respect of insurance in the province acts as an agent, broker or representative or may influence the insured or prospect for insurance;

             (b)  a representative for life insurance on himself or herself or a member of his or her immediate family unless the agent, broker or representative has within 1 year negotiated and fully paid the 1st premium to the insurer for at least 3 other contracts of life insurance; and

             (c)  an agent, broker or representative for insurance contracts on property or risk in which

                      (i)  the licensee,

                     (ii)  a member of the licensee's immediate family, or

                    (iii)  a corporation of which the licensee is an officer, director or employee

is the owner or has the financial interest in, unless the licensee has within 1 year negotiated and paid premiums on additional contracts, other than life insurance, involving at least an equal premium value.

             (2)  The superintendent may cancel the licence of an agent or broker which or a representative who has failed to negotiate within 1 year the additional contracts required by paragraphs (1)(b) and (c).

             (3)  Subsection (1) shall not affect the payment or allowance by an agent, broker or representative of part of his or her commission to agents or brokers outside the province.

1986 c36 s28; 1996 c35 s45

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Payments of premium

      29. Payments in whole or in part to an agent, broker or representative of the amount of a premium or assessment due in respect of a contract issued by an insurer shall be considered to be a payment to the insurer notwithstanding a condition or stipulation to the contrary.

1986 c36 s29

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Trust funds

      30. (1) All funds received or receivable by an agent, broker or representative in the course of the business of that agent, broker or representative

             (a)  on behalf of an insurer from members of the public, less the commission and other deductions authorized by the insurer in writing; and

             (b)  on behalf of members of the public from an insurer,

are considered to be trust funds.

             (2)  An agent, a broker or representative shall not assign, pledge, hypothecate, mortgage or in any other way charge the funds referred to in subsection (1) whether or not those funds have been received or remain receivable.

             (3)  An assignment, pledge, hypothecation, mortgage or other charge of or on funds referred to in subsection (1) is void against the beneficial owner of the funds.

             (4)  Subsections (1), (2) and (3) do not apply to negotiable instruments payable directly to an insurer.

1986 c36 s30

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Exemption from S.30

   30.1 A person may make application to the minister for an exemption from the requirements in section 30 and the minister may exempt the applicant in whole or in part for a period not to exceed 12 months from the date of proclamation of the Insurance Adjusters, Agents and Brokers Act .

1993 c24 s7

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Trust funds paid to insurer

      31. (1) After the expiry of a period of time stipulated in an agreement between the agent, broker or representative and an insurer for payment of funds to the insurer, the funds held in trust for an insurer by an agent, broker or representative shall be paid over to the insurer within 15 days after a written demand is made, less commission and deductions to which, by written consent of the insurer, the agent, broker or representative is entitled.

             (2)  After funds have been received by an agent, broker or representative from the insurer, the funds held in trust for an insured by an agent, broker or representative shall be paid over to the insured within 15 days after a written demand, plus unearned commission or other refund to which the insured is entitled.

1986 c36 s31

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Lien on policy

      32. Unless otherwise agreed, the broker, agent or representative has as against the insured, a lien upon the policy for the amount of the premium and the licensee's charges in respect of the policy.

1986 c36 s32

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Statement of financial affairs

      33. (1) Where an individual, partnership or corporation is licensed as an agent, broker or representative and maintains one or more trust accounts, that individual, partnership or corporation shall present annually to the superintendent not later than 3 months after the fiscal year end of the agent, broker or representative, a statement of the financial affairs of the business of the licensee in a form prescribed by the superintendent for the period then ended.

             (2)  This section does not apply to a representative who is an employee of an insurer, broker or agent.

             (3)  The superintendent may exempt a person or a class of persons from the requirement in subsection (1) in whole or in part and with the restrictions, limitations or conditions the superintendent considers appropriate.

1986 c36 s33; 2013 c20 s1

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Insurers annual return

      34. An insurer shall make an annual return to the superintendent in a prescribed form identifying

             (a)  all persons authorized as agents, brokers or representatives of that insurer in the province; and

             (b)  all persons to whom the insurer paid compensation in respect of the placement of or negotiation of contracts of insurance or renewals of the contract, or for attempting to do so.

1986 c36 s34

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Records audited

      35. The superintendent or the person who represents the superintendent shall have the authority at reasonable times to examine or audit the records of an agent, broker or representative to the extent necessary to determine the affairs of the agent, broker or representative.

1986 c36 s35

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Re holding out

      36. (1) A person shall not hold out as an adjuster or representative or act as an adjuster or representative unless that person holds a valid, existing licence under this Act authorizing that person to act in the capacity of an adjuster or representative.

             (2)  A corporation or partnership shall not hold itself out as an adjustment company, agent or broker or so act unless it holds a valid subsisting licence under this Act authorizing it to act in the capacity of an adjustment company, agent or broker.

1986 c36 s36

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Collectors of insurance premiums

      37. (1) A collector of life insurance premiums and premiums for insurance undertaken by an insurer as part of a contract of accident and sickness insurance which insures against loss resulting from bodily injury to, or the death of, a person caused by an accident or under which the insurer undertakes to pay a certain sum or sums of insurance money in the event of bodily injury to, or the death of, a person caused by an accident, who does not solicit applications for or the renewal or continuance of insurance contracts or act or aid in negotiating those contracts or the renewal of those contacts, may carry on a business without a licence.

             (2)  This section does not apply where the collection fee exceeds 5% of an amount collected.

1986 c36 s37; 2010 c15 s11

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Fraternal or sororal societies, etc.

      38. (1) A member of a fraternal or sororal society or mutual benefit society, other than one who devotes or intends to devote more than 50% of his or her time to the solicitation and procurement of insurance contracts for that society and who receives or intends to receive commission or other compensation directly dependent on the amount of insurance solicited and procured by him or her, may, without a licence, solicit persons to become members of that society.

             (2)  Where a person who in the preceding calendar year has solicited and procured insurance contracts on behalf of a fraternal or sororal society or mutual benefit society in an amount of insurance in excess of a prescribed amount, that person is presumed to be devoting or intending to devote more than 50% of his or her time to the solicitation or procurement of insurance contracts for that society.

             (3)  In this section

             (a)  "fraternal or sororal society" means fraternal or sororal society as defined by paragraph 2(u) of the Insurance Companies Act ; and

             (b)  "mutual benefit society" means mutual benefit society as defined by paragraph 2(ii) of the Insurance Companies Act .

1986 c36 s38

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Payment of bonus, etc. to insurer's employees

      39. Nothing in this Act shall affect a payment by way of dividend, bonus, profit or savings which is provided for by a contract of insurance or be construed so as to prevent an insurer compensating an actual salaried employee of the head or a branch office of the insurer in the province in respect of insurance issued by the employing insurer upon the life of that employee or so as to require that the employee shall be licensed as an agent, broker or representative to effect the insurance.

1986 c36 s39

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Privileged information

      40. Information, a document, record, statement or other thing made or disclosed to the superintendent concerning a person licensed or applying for a licence under this Act shall be absolutely privileged and shall not be used as evidence in an action or proceedings in a court brought by or on behalf of that person.

1986 c36 s40

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Incapacity

      41. (1) In the event of the incapacity of a licensee to discharge the duties of an adjuster, an adjustment company, agent, broker or representative, the superintendent may, where the superintendent considers it appropriate in a particular case, appoint another licensee holding the same class of licence or an adjuster, adjustment company, agent, broker or representative holding a licence equivalent to that of the incapacitated licensee issued by another Canadian jurisdiction to administer the affairs of the incapacitated licensee.

             (2)  The superintendent shall review the appointment of the licensee to administer the affairs of an incapacitated licensee every 3 months, or at more frequent intervals as the superintendent considers appropriate.

             (3)  In this section the word "incapacity" includes the inability of a licensee to act due to sickness or illness, or due to the suspension, revocation or cancellation of the licence.

1986 c36 s41

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Superintendent's inquiries

      42. A licensee shall make prompt and explicit reply to an inquiry directed to the licensee by the superintendent in relation to a transaction of the licensee relating to insurance activity.

1986 c36 s42

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Investigations

      43. (1) The superintendent or a person authorized by the superintendent may, where it is reasonably necessary to determine compliance with this Act or the regulations, enter a place and demand the production of and inspect the business books, documents, correspondence and records that the superintendent or authorized person believes on reasonable grounds are relevant to the investigation being made.

             (2)  Where the superintendent believes on reasonable grounds that a person has contravened this Act or regulations or where the superintendent believes on reasonable grounds that a person has engaged in, is engaging in or is about to engage in an unfair trade practice or unconscionable act or practice relating to insurance, the superintendent, or a person authorized by the superintendent, may with a warrant issued under subsection (3) at a reasonable time enter a place and may investigate, inquire into and examine the affairs in relation to the trade practice, act or practice relating to insurance in respect of which the investigation is being made and into books, documents, correspondence and records in relation to it.

             (3)  A judge of the Provincial Court or the Trial Division who is satisfied by information upon oath or affirmation that there are reasonable grounds for believing that there is in a place anything that will give evidence with respect to a contravention of this Act or the regulations or an unfair trade practice, unconscionable act or practice relating to insurance may issue a warrant authorizing the superintendent, or a person authorized by the superintendent named in the warrant, to enter and search that place and to make those inquiries and to seize those books, documents, correspondence and records that are considered necessary, subject to those conditions that may be specified in the warrant, and to bring them before the judge granting the authorization or another judge to be dealt with by him or her according to the law.

          (3.1)  Where a thing is seized and brought before a judge under subsection (3), he or she shall, by order,

             (a)  detain it or direct it to be detained in the care of a person named in the order; or

             (b)  direct it to be returned,

and the judge may in the order authorize the examination, testing, inspection or reproduction of the thing seized upon the conditions that are reasonably necessary and directed in the order, and may make another provision that in the opinion of the judge is necessary for its preservation.

          (3.2)  Nothing shall be detained under an order made under subsection (3.1) for a period of more than 3 months after the time of seizure unless, before the expiration of that period,

             (a)  upon motion, a judge is satisfied that having regard to the nature of the investigation, its further detention for a specified period is warranted and he or she so orders; or

             (b)  a proceeding is instituted in which the thing detained may be required.

          (3.3)  Upon the motion of the person having an interest in a thing detained under subsection (3.1), a judge may make an order for the examination, testing, inspection or reproduction of a thing detained upon the conditions that are reasonably necessary and directed in the order.

          (3.4)  Upon the motion of a person having an interest in a thing detained under subsection (3.1), and upon notice to the person or company in respect of which the investigation is being made, the person from whom the thing was seized, the person to whom the order under subsection (3.1) was issued and a person who has an interest in the thing detained, a judge may make an order for the release of a thing detained to the person from whom the thing was seized where it appears that the thing detained is no longer necessary for the purpose of the investigation.

             (4)  The owner or person in charge of the place referred to in this section and every person found in that place shall give the superintendent, or a person authorized by the superintendent, all reasonable assistance to enable that person to carry out his or her duties and functions under this section and shall provide information that that person may reasonably require.

             (5)  For the purposes of the Trade Practices Act , the interpretation of consumer transaction in that Act includes matters relating to insurance under this Act.

             (6)  For the purpose of subsections (2) and (3), "place" includes a private dwelling place.

1986 c36 s43; 2004 c36 s19; 2010 c17 s1

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Powers

43.01 (1) The superintendent or a person authorized by the superintendent who is making an investigation under section 43 has the same power to summon and enforce the attendance of a person and to compel him or her to testify on oath or otherwise, and to summon and compel a person or company to produce documents and other things, that is vested in a judge of the Trial Division, and the refusal of the person to attend or to answer questions or of a person or company to produce documents or other things that are in his, her or its custody or possession makes the person or company liable to be committed for contempt by a judge of the Trial Division as if in breach of an order of that court.

             (2)  A person or company giving evidence under subsection (1) may be represented by counsel and may claim a privilege to which the person or company is entitled.

2010 c17 s2

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Production order

43.02 (1) A judge of the Provincial Court or a judge of the Trial Division may order a person, other than a person who is the subject of an investigation,

             (a)  to produce a document or a copy of a document, certified by affidavit to be a true copy, or to produce data; or

             (b)  to prepare a document based on a document or data already in existence and to produce it.

             (2)  An order referred to in subsection (1) shall require the document or data to be produced within the time, at the place and in the form specified and to be given to the superintendent or a person designated by the superintendent.

             (3)  A judge may make an order referred to in subsection (1) where he or she is satisfied on the basis of an application made in writing on oath or affirmation and without notice that there are reasonable grounds to believe that

             (a)  a person has contravened or is contravening this Act or the regulations or is suspected to have contravened this Act or the regulations;

             (b)  the document or data will provide evidence respecting a contravention or suspected contravention of this Act or the regulations; and

             (c)  the person who is subject to the order has possession or control of the document or data.

             (4)  An order referred to in subsection (1) may contain terms and conditions that the judge considers advisable in the circumstances, including terms and conditions to protect a privileged communication between a lawyer and his or her client.

             (5)  The order referred to in subsection (1) may be revoked, renewed or varied.

             (6)  A copy of a document produced under this section, on proof by affidavit that it is a true copy, is admissible in evidence in proceedings under this Act and has the same probative force as the original document would have if it had been proved in the ordinary way.

             (7)  Copies of documents produced under this section are not required to be returned to the person who provided them.

2010 c17 s2

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Order for compliance

   43.1 (1) Where it appears to the superintendent that a person is not complying with a provision of this Act or the regulations the superintendent may make an order directing that person to comply with the provision.

             (2)  An appeal lies to the minister from an order made under subsection (1).

             (3)  Where it appears to the superintendent that a person has failed to comply with or is not complying with

             (a)  an order, decision, direction or inquiry made under this Act;

             (b)  an undertaking given; or

             (c)  a term, condition or restriction imposed on a licence, where applicable,

the superintendent may, in addition to any other right under this Act, apply to a judge of the Trial Division for an order directing the person to comply with or restraining the person from violating the order, decision, direction, inquiry, undertaking, term, condition or restriction, and the judge may make an order that he or she considers appropriate.

             (4)  An appeal lies to the Court of Appeal from an order made under subsection (3).

1993 c24 s8

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Property held in trust

   43.2 (1) Where the superintendent believes that a licensee has been or may be guilty of misconduct in connection with property in the licensee's possession or under the licensee's control, the minister may, upon the report of the superintendent, order that the property described in the order shall not be paid out or dealt with by the person named in the order without the approval of the minister.

             (2)  Where the superintendent believes that the business of a licensee or former licensee is neglected to the prejudice of a person or that the interests of the clients of the licensee or former licensee are not being protected or that the licensee or former licensee has converted trust funds, the minister may, upon the report of the superintendent, by order appoint a person as trustee to take possession of property or an undertaking in the possession of or under the control of the licensee or former licensee for the purpose of preserving, carrying on or winding up the business of the licensee or former licensee.

             (3)  A person appointed under subsection (2) shall be the trustee in respect of a trust property of the licensee or former licensee, and the person shall in respect of that trust property take the place of a personal representative, committee or other representative of the licensee or former licensee.

             (4)  A licensee or former licensee may appeal to the Trial Division in accordance with the Rules of Court, from an order made by the minister under this section within 30 days after the delivery of a copy of the order to the licensee or former licensee or an officer.

             (5)  The minister may, in an order made under subsection (2), make provision for the remuneration, disbursements and indemnification of the trustee out of that money or otherwise as the minister may specify.

1993 c24 s8

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Regulations

      44. The Lieutenant-Governor in Council may make regulations

             (a)  prescribing requirements, qualifications and conditions for granting licences;

             (b)  prescribing classes of licences under paragraph 2(r) to which this Act applies;

             (c)  providing for examination of applicants for licences or the equivalent to an examination;

             (d)  classifying applicants for licences and restricting or prohibiting the licensing of a class of applicant;

             (e)  prescribing classes of insurance for which licences may be issued under this Act;

              (f)  prescribing the grounds upon which licences may be revoked or suspended;

             (g)  requiring adjusters, agents, brokers or representatives to supply information and make returns to the superintendent;

             (h)  requiring adjusters, agents, brokers or representatives to furnish a surety bond or other security on the form and terms and in the amount that the superintendent prescribes and requiring a certificate of insurance against liability in respect of an occurrence with regard to errors and omissions, in the amount the superintendent prescribes;

              (i)  exempting a class of claims, person or class of insurance from all or a section of this Act or the regulations;

              (j)  [Rep. by 1996 cR-10.1 s37]

             (k)  [Rep. by 1996 cR-10.1 s35]

              (l)  requiring an annual certificate of membership in a professional association whose objective is continuing education or supervision of adjusters or representatives;

            (m)  providing for reviewing the continuance of a licence by the superintendent in cases where an adjuster or representative is dismissed from a prescribed professional association;

             (n)  respecting the method of handling premiums collected and requiring and regulating trust accounts and records to be maintained by agents, brokers and representatives;

             (o)  respecting the replacement of an existing contract of life insurance by another contract of life insurance and prescribing the duties of insurers, agents, brokers or representatives in connection with the replacement of contracts of life insurance;

             (p)  prescribing requirements for the issuing of special licences under section 24 and the returns that a person under that section must submit to the superintendent;

             (q)  prescribing the information a person licensed under section 24 must submit to the superintendent under section 25;

              (r)  prescribing the transitional requirements of a person eligible for a licence under this Act or the regulations and a step licensing procedure; and

             (s)  generally, to give effect to the purpose of this Act.

1986 c36 s44; 1996 cR-10.1 s37; 1996 c35 s46; 2010 c15 s12

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Fees and forms

   44.1 The minister may set fees and forms for the purpose of a provision of this Act that provides for a fee or form to be prescribed.

2001 c42 s22

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Offence

      45. (1) A natural person

             (a)  who not being the holder of a licence; or

             (b)  who while his or her licence is suspended,

             (c)  [Rep. by 1996 c35 s47]

acts as or represents or holds himself or herself out to be an adjuster, representative or student, or

             (d)  who, being the holder of a licence which is in force, by any means acts as or represents or holds himself or herself out to be an adjuster, representative or student in a name other than that stated in his or her licence,

is guilty of an offence.

             (2)  A corporation or a partnership

             (a)  while not being the holder of a licence; or

             (b)  which while its licence is suspended,

             (c)  [Rep. by 1996 c35 s47]

acts as or represents or holds itself out to be an adjustment company, agent or broker, or

             (d)  which, being the holder of a licence which is in force, by any means acts as or represents or holds itself out to be an adjustment company, agent or broker in a name other than that stated in its licence,

is guilty of an offence.

             (3)  A person who violates this Act or the regulations or a condition on a licence or to which the licence is made subject is guilty of an offence.

             (4)  [Rep. by 1993 c24 s9]

             (5)  An agent, broker or representative who knowingly procures by fraudulent representations, payment or the obligation for payment of a premium on an insurance policy is guilty of an offence.

             (6)  A person who directly or indirectly induces or attempts to induce an insured to his or her financial prejudice to replace an existing contract of insurance by another contract of insurance is guilty of an offence.

             (7)  A person licensed as an insurance agent, broker or representative under this Act, who, directly or indirectly,

             (a)  makes a false or misleading statement or representation in the solicitation or negotiation of insurance; or

             (b)  coerces or attempts to coerce a prospective buyer of insurance through influence of business, professional relationship or otherwise to give a preference which would not otherwise be given in the effecting of an insurance contract,

is guilty of an offence.

             (8)  An agent, broker or representative who attempts the replacement of a contract of life insurance without proper disclosure to the client of advantages and disadvantages of that replacement in a form prescribed by the superintendent is guilty of an offence.

             (9)  An agent, broker or representative who violates the terms of the trust as outlined in section 30 or 31 is guilty of an offence.

           (10)  An insurer, agent, broker or representative who fails to notify the superintendent within 30 days of the termination of the appointment of a licensee is guilty of an offence.

           (11)  Except as provided for in sections 24 and 25, a director, officer, agent, broker, representative, employee or other person representing or purporting to represent an insurer who is not licensed under the Insurance Companies Act or whose licence has been suspended or cancelled, and who undertakes or affects or agrees or offers to undertake or effect or solicit a contract of insurance or collect premiums on behalf of that insurer is guilty of an offence.

           (12)  A person who represents orally or in writing that the issue of a licence to an adjuster, adjustment company, agent, broker, representative or insurer or the printing or publication of an annual statement in a report or other publication of the government of the province or other circumstances of the supervision or regulation of the business of an adjuster, adjustment company, agent, broker, representative or insurer by law is a warranty or guarantee of the financial standing of the adjuster, adjustment company, agent, broker, representative or insurer is guilty of an offence.

           (13)  A person who violates subsection 28(1) is guilty of an offence.

        (13.1)  A person who obstructs or interferes with the superintendent or a person authorized by the superintendent who is carrying out a duty under this Act or the regulations is guilty of an offence.

           (14)  Every person who fails to comply with a requirement of or an order or direction made under this Act is guilty of an offence.

1986 c36 s45; 1987 c41 s8; 1992 c13 s1; 1993 c24 s9; 1996 c35 s47; 2010 c17 s3

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Penalty

      46. (1) On conviction for an offence under this Act, the person convicted is liable on summary conviction to a fine of not more than $1,000,000 or to a period of imprisonment of not more than 2 years or to both a fine and imprisonment.

             (2)  Every director or officer of a corporation and every person acting in a similar capacity or performing similar functions in an unincorporated association and every member of a partnership, who,

             (a)  caused, authorized, permitted or participated in an individual, corporation, unincorporated association or partnership committing an offence referred to in section 45; or

             (b)  failed to take reasonable care to prevent an individual, corporation, unincorporated association or partnership from committing an offence referred to in section 45,

is guilty of an offence and liable on summary conviction to a fine of not more than $1,000,000 or to a period of imprisonment of not more than 2 years or to both a fine and imprisonment whether or not the individual, corporation, unincorporated association or partnership has been prosecuted for or convicted of the offence.

             (3)  Where a person is convicted of an offence under this Act, the court making the conviction may, in addition to another penalty, order the person convicted to make compensation or restitution.

2010 c17 s4

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Limitation

      47. A prosecution for an offence against this Act and the regulations shall be started within 2 years of the discovery of the offence by the superintendent.

1986 c36 s47

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RSN1970 c176 Amdt.

      48. (1) Paragraph 2(b) of the Insurance Companies Act is repealed and the following substituted:

             (b)  "agent" means agent as defined by the Insurance Adjusters, Agents and Brokers Act ;

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

             (g)  "broker" means broker as defined by the Insurance Adjusters, Agents and Brokers Act ;

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

          (vv)  "representative" means representative as defined by the Insurance Adjusters, Agents and Brokers Act ;

      (4) Subsection 96(2) of the Act is amended by striking out the words "an agent of life insurance under the Life and Accident Insurance Agents Licensing Act " and by substituting the words "a representative of a life insurer licensed under theInsurance Adjusters, Agents and Brokers Act ".

1986 c36 s50

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RSN1970 cc.175 and 204 Rep.

      49. The Insurance Adjusters Act and the Life and Accident Insurance Agents Licensing Act are repealed.

1986 c36 s51

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Commencement

      50. This Act or a section of this Act comes into force on a day or days to be proclaimed by the Lieutenant-Governor in Council. (In force - Jul. 1/93)

1986 c36 s52