Ottawa, June 30, 2011
2011-053

Archived - Minister of Finance Announces Public Consultations on Demutualization of Property and Casualty Mutual Insurance Companies

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The Honourable Jim Flaherty, Minister of Finance, today launched public consultations aimed at developing a framework for the demutualization of federally regulated property and casualty (P&C) mutual insurance companies.

“Our Government is committed to providing financial institutions with the flexibility and tools they need to grow and be competitive,” said Minister Flaherty. “We intend to develop a framework that will allow an orderly and transparent conversion from a mutual company to a share company, while ensuring that policyholders are treated fairly and equitably.”

Mutual P&C companies, which are owned and governed by their policyholders, engage in a number of business lines including automobile, home and commercial insurance. Recently, some mutual P&C companies have expressed a desire to make a transition to share corporations.

In the budget tabled on June 6, 2011, the Government announced its plan to introduce a framework to provide an orderly and transparent process for demutualization. In developing this framework, the Government intends to consult broadly to ensure the interests of all affected parties are reflected.

To help guide the consultations, the Government is releasing a paper entitled Consultation on a Demutualization Framework for Federal Property & Casualty Insurance Companies, which highlights a number of key issues to be addressed.

The Government invites comments from stakeholders on any element of the paper by July 31, 2011. The paper includes detailed instructions on making a submission.

For further information, media may contact:

Mary Ann Dewey-Plante
Press Secretary
Office of the Minister of Finance
613-996-7861

Jack Aubry
Media Relations
Department of Finance
613-996-8080

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