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Can A Canadian Life Insurer Become Insolvent?

Are You Protected by Assuris?


If you are a Canadian citizen or resident, and you purchased a product from a member life insurance company in Canada, you are protected by Assuris.

How Does Assuris Protect You?

If your life insurance company fails, your policies will be transferred to a solvent company. Assuris guarantees that you will retain at least 85% of the insurance benefits you were promised. Insurance benefits include Death, Health Expense, Monthly Income and Cash Value.

Your deposit type products will also be transferred to a solvent company. For these products, Assuris guarantees that you will retain 100% of your Accumulated Value up to $100,000. Deposit type products include accumulation annuities, universal life overflow accounts and dividend deposit accounts.

For a Tax Free Savings Account (TFSA) invested in an Accumulation Annuity, Assuris provides separate protection from other deposit type products. For TFSAs, Assuris guarantees that policyholders will retain 100% of the Accumulated Value up to $100,000.

The key to Assuris protection is that it is applied to all benefits of a similar type. If you have more than one policy with the failed company, you will need to add together all similar benefits before applying the Assuris protection. For a detailed table on adding benefit types together

Past Insolvencies


Although there have only been three insolvencies in the life insurance industry in Canada, Assuris has built a reputation for working in partnership with others to support policyholders and contain losses. Shortly after Assuris came into being in 1990, we were called upon to deal with the three insolvencies of the 1990’s. In addition to financial support, Assuris quickly developed expertise to resolve the unique, and largely unprecedented, issues in a life insurance company insolvency affecting Canadian policyholders. In all three cases, all the Canadian policies were ultimately transferred to solvent life insurance companies.

Les Coopérants


On January 3, 1992, Les Coopérants, headquartered in Montreal, was ordered into liquidation under the Winding-up Act. At the time Les Coopérants was declared insolvent, it had individual insurance contracts with 222,000 policyholders and group insurance certificate holders numbering 600,000. As the first life insurance company insolvency in Canada, the liquidation of Les Coopérants posed a steep learning curve. To protect policyholder interests, Assuris successfully established the precedent that policyholders should receive priority in the liquidation of a life company. Assuris’ support also included guaranteeing that all policyholder benefits would be fully protected. Our final accounting of costs indicates that $180 million was required to provide this support.

Sovereign Life


On January 18, 1993, a Winding-up order was granted against Sovereign Life, based in Calgary. At the time, Sovereign Life had 249,000 policyholders, 96% of whom were 100% protected by Assuris coverage. Of the remaining 4%, who incurred some losses, all retained at least 90% of their benefits. To facilitate transferring adjusted policy benefits to solvent life insurers, Assuris introduced the concept of proportional reinsurance. Assuris also established a life insurance company subsidiary to reinsure policy liabilities and maximize recoveries from the residual assets of Sovereign Life. Our developing insolvency experience helped to achieve a final cost of only $20 million.

Confederation Life


On August 11, 1994, the liquidation of Confederation Life began. With operations in Canada, the United States and the United Kingdom, Confederation Life was an internationally complex liquidation. In Canada alone it had obligations to 260,000 individual policyholders and another 1.5 million people who participated in group insurance plans. In the end, Assuris partnered with the regulator and the liquidator to leverage lessons learned in previous insolvencies. The result was full recovery for policyholders and a final cost to Assuris, for expenses incurred of only $5 million.

By all measures, Assuris has had an enviable record protecting Canadian policyholders’ benefits. Through the three insolvencies, Assuris’ coverage has protected almost three million people representing over 10 % of Canadians.