D-9.2, r. 8 - Regulation respecting distribution without a representative

Updated to 10 February 2018

This document has official status.

chapter D-9.2, r. 8

Regulation respecting distribution without a representative

Act respecting the distribution of financial products and services

(chapter D-9.2, ss. 209, 210 and 423).

The fees prescribed in the Regulation have been indexed pursuant to the notice published in Part 1 (French) of the Gazette officielle du Québec of 10 February 2018, page 94. (ss. 11, 12, 13). (Effect from 1 January 2018.)

DIVISION 1 NOTICES

§ 1 . — General provisions

1. The notices provided for in this chapter shall be printed in character equivalent to Bookman Old Style at least 10 points in size.

Decision 99.06.45, s. 1.

§ 2 . — Notice of rescission of an insurance contract

Decision 99.06.45, Subdiv. 2; M.O. 2010-18, s. 1.

2. The notice set out in section 440 of the Act respecting the distribution of financial products and services (chapter D-9.2) to inform the client that he has the right to rescind the insurance contract made at the time of another contract shall comply with the model set out in Schedule 1 - NOTICE OF RESCISSION OF AN INSURANCE CONTRACT.

Decision 99.06.45, s. 2; M.O. 2010-18, s. 2.

§ 3 . — Notice in respect of the choice of an insurer

3. The notice set out in section 443 of the Act to inform the client of his right to choose an insurer or a representative of his choice when a distributor requires that the debtor purchase insurance to guarantee the reimbursement of his loan shall comply with the model set out in Schedule 2 - NOTICE OF FREE CHOICE OF INSURER.

Decision 99.06.45, s. 3; M.O. 2010-18, s. 3.

§ 4 . — Notice of specific consent

4. The notice set out in sections 92 and 437 of the Act to seek the specific consent of a client in order to authorize a distributor to use information held by him for other purposes than the purposes for which it has been gathered shall be in accordance with the form set out in Schedule 3 - NOTICE OF SPECIFIC CONSENT.

Decision 99.06.45, s. 4.

DIVISION 2 DISTRIBUTION GUIDE

§ 1 . — General provisions

5. The distribution guide which must be prepared by an insurer to offer insurance products through a distributor contains the information provided for in Schedule 4.

Decision 99.06.45, s. 5.

6. The distribution guide may be presented with the individual insurance contract provided that it appears first and that it is clearly identifiable.

Decision 99.06.45, s. 6.

§ 2 . — Form of drafting of distribution guide

7. The distribution guide shall be printed or otherwise made available to the consumer, at his option, by any other means allowing for the reading and printing thereof.

Decision 99.06.45, s. 7.

8. The text of the distribution guide:

(1)  shall be presented in narrative style, in the order of the items indicated in Schedule 4 and using the same headings and sub-headings;

(2)  shall be printed in a character equivalent to Bookman Old Style at least 10 points in size; however, the texts of the item concerning the exclusion or reduction of coverage shall be in bold-faced characters;

(3)  shall provide for a line spacing of at least 2 points;

(4)  shall present a table of contents of the items;

(5)  shall be drafted clearly and simply in order to transmit an unambiguous message;

(6)  shall consist of short, direct sentences, and the text shall be concise;

(7)  may include illustrations, color, pictures, and informative items in order to facilitate comprehension by the consumer and transmit information in a user-friendly manner;

(8)  shall include definitions when necessary to facilitate comprehension of the information set out in the guide.

Decision 99.06.45, s. 8.

9. The information contained in the distribution guide shall not be drafted in a false or misleading manner or in a manner which may be deceptive.

Decision 99.06.45, s. 9.

DIVISION 3 COSTS PERTAINING TO EXAMINATION OF THE DISTRIBUTION GUIDE

10. (Revoked).

Decision 99.06.45, s. 10; Decision 2002.03.11, s. 1.

11. Fees of $1 116 are payable when an insurer files a distribution guide.

Hourly fees of $133 shall be charged by the Authority for any period exceeding 10 hours of analysis.

Decision 99.06.45, s. 11; Decision 2002.03.11, s. 2.

12. Fees of $133 per hour are payable for the analysis of any amendment to the distribution guide filed by an insurer.

Decision 99.06.45, s. 12; Decision 2002.03.11, s. 3.

13. Fees of $279 are payable each time the Authority agrees to extend the time-period granted under section 416 of the Act.

Decision 99.06.45, s. 13; Decision 2002.03.11, s. 4.

SCHEDULE 1

(s.2)

NOTICE OF RESCISSION OF AN INSURANCE CONTRACT

NOTICE GIVEN BY A DISTRIBUTOR

Section 440 of the Act respecting the distribution of financial products and services (chapter D-9.2)

THE ACT RESPECTING THE DISTRIBUTION OF FINANCIAL PRODUCTS AND SERVICES GIVES YOU IMPORTANT RIGHTS.

· The Act allows you to rescind an insurance contract you have just signed when signing another contract, without penalty, within 10 days of its signature. To do so, you must give the insurer notice by registered mail within that delay. You may use the attached model for this purpose.

· Despite the rescission of the insurance contract, the first contract entered into will remain in force. Caution, it is possible that you may lose advantageous conditions as a result of this insurance contract; contact your distributor or consult your contract.

· After the expiry of the 10-day delay, you may rescind the insurance at any time; however, penalties may apply.

For further information, contact the Autorité des marchés financiers at [phone] or 1-877-525-0337.

NOTICE OF RESCISSION OF AN INSURANCE CONTRACT

To: ________________________________________________________________________________________

(name of insurer)

_________________________________________________________________________________________

(address of insurer)

Date: _________________________________________

(date of sending of notice)

Pursuant to section 441 of the Act respecting the distribution of financial products and services, I hereby rescind insurance contract no.: ________________________________________________________________________

(number of contract, if indicated)

Entered into on: ________________________________

(date of signature of contract)

In:___________________________________________

(place of signature of contract)

___________________________________________ ___________________________________________

(name of client) (signature of client)

The distributor must first complete this section.

This document must be sent by registered mail.

Sections 439, 440, 441, 442 and 443 of the Act must be reproduced on the back of this notice.

Decision 99.06.45, Sch. 1; M.O. 2010-18, s. 4.

SCHEDULE 2

(s. 3)

NOTICE OF FREE CHOICE OF INSURER OR REPRESENTATIVE

Section 443 of the Act respecting the distribution of financial products and services (chapter D-9.2)

THE ACT RESPECTING THE DISTRIBUTION OF FINANCIAL PRODUCTS AND SERVICES GIVES YOU IMPORTANT RIGHTS.

· You are required to purchase insurance coverage to secure the repayment of a loan;

· However, you are free to purchase this insurance from the insurer or representative of your choice. You may thus obtain the required insurance in 3 different ways:

(1) By purchasing the insurance offered to you;

If you choose this option, you benefit from the application of section 19 of the Act which allows you to rescind an insurance contract that you signed at the time of signing another contract, without penalty, within 10 days of its signature. However, you must then purchase another equivalent insurance to the satisfaction of the creditor who may not refuse without reasonable causes.

(2) By purchasing other insurance that is equivalent to the insurance required, to the satisfaction of the creditor who may not refuse without reasonable cause.

(3) By demonstrating that you already have insurance that is equivalent to the insurance required, to the satisfaction of the creditor who may not refuse without reasonable cause.

You may change insurer or representative at any time, provided that during the term of the loan agreement you maintain insurance equivalent to the insurance required to the satisfaction of the creditor who may not refuse without reasonable cause. You cannot be required to choose or keep an insurance contract with a particular insurer, nor can you be refused credit or have your loan called in for this reason.

To rescind you insurance, you may use the section hereunder entitled “Notice of rescission of an insurance contract”. For further information, contact the Autorité des marchés financiers at: [phone] or 1-877-525-0337.

________________________________________________________________________

DESCRIPTION OF THE REQUIRED COVERAGE

(section completed by the distributor)

To secure the repayment of your loan, we have required that you purchase:

□ damage insurance: _____________________________________________

in an amount of: $____________ _____________________________________________

(coverage) _____________________________________________

(particulars)

□ insurance of persons of the following type: _____________________________________________

in an amount of: $ ____________ (life, disability, other)

(coverage)

NOTICE OF RESCISSION OF AN INSURANCE CONTRACT

Section 440 of the Act respecting the distribution of financial products and services (chapter D-9.2)

To: ________________________________________________________________________________________

(name of insurer)

_________________________________________________________________________________________

(address of insurer)

Date: _________________________________________

(date of sending of notice)

Pursuant to section 441 of the Act respecting the distribution of financial products and services,

I hereby rescind insurance contract no.: ____________________________________________________________

(number of contract, if indicated)

Entered into on: ______________________________

(date of signature of contract)

In: _________________________________________

(place of signature of contract)

___________________________________________ __________________________________________

(nom of client) (signature of client)

The distributor must first complete this section.

This document must be transmitted by registered mail.

Sections 439, 440, 441, 442 and 443 of the Act must be reproduced on the back of this notice.

Decision 99.06.45, Sch. 2; M.O. 2010-18, s. 4.

Schedule 3

(s. 4)

NOTICE OF SPECIFIC CONSENT

YOU ARE FREE TO GRANT OR REFUSE THIS CONSENT

Section 92 and 437 of the Act respecting the distribution of financial products and services (chapter D-9.2)

 _________________________________________________________________________________
|                                                                                 |
| WHAT YOU MUST KNOW:                                                             |
|                                                                                 |
| ·  At this date, we hold certain information relating to you.                   |
|                                                                                 |
| ·  We require your consent to allow some of our clerks to have  access to this  |
|    information.                                                                 |
|                                                                                 |
| ·  These clerks will also have access to any update of the information done     |
|    during the period of validity of the consent.                                |
|                                                                                 |
| ·  These clerks will use the information available in order to solicit you for  |
|    the purchase of new financial products and services.                         |
|                                                                                 |
| YOU ARE FREE TO SET THE PERIOD OF VALIDITY OF YOUR CONSENT                      |
|                                                                                 |
|                                                                                 |
| ·  If you grant consent for an undetermined period of time, you may at any time |
|    terminate it by revoking it.  At the end of this form, you will find         |
|    a revocation notice model that you may use for this purpose, or as a basis   |
|    for preparing your own notice.                                               |
|                                                                                 |
| ·  If you wish to grant consent for a limited period of time, you may do so by  |
|    determining this period yourself.  This form provides, in the “specific      |
|    consent” section, a place where you may write down the period of validity    |
|    desired.                                                                     |
|                                                                                 |
|         THE ACT RESPECTING THE DISTRIBUTION OF FINANCIAL PRODUCTS AND           |
|                       SERVICES GIVES YOU IMPORTANT RIGHTS.                      |
|                                                                                 |
|                                                                                 |
| Without this specific consent, the distributor may not use this information     |
| for a purpose other than the purpose for which it was collected. The            |
| distributor cannot compel you to give your consent or refuse to do business     |
| with you if you refuse to give it.  Section 94 of the Act protects you. For     |
| further information, contact the Autorité des marchés financiers at:            |
| [phone] or 1-877-525-0337.                                               |
|_________________________________________________________________________________|

    

The information we hold pertaining to you, at this date, was collected as part of:

---

---

(purposes of the file)

Here are the required categories of information that we would like one of our clerks to use and the products and services he may offer you. For a fuller description of each category, you may refer to the back of this sheet.

Please authorize each category of information requested.

 _________________________________________________________________________________
|                        |                      |                  |              |
|  Required information  |  For which products  |    Client’s      |              |
|     category to be     |    and services?2    |  Authorization3  |  Initiales4   |
|        accessed1       |                      |                  |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
| To be filled by the    | To be filled by the  |  □  Yes  □  No   |              |
| distributor            | distributor          |                  |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
|                        |                      |  □  Yes  □  No   |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
|                        |                      |  □  Yes  □  No   |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
|                        |                      |  □  Yes  □  No   |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
|                        |                      |  □  Yes  □  No   |              |
|________________________|______________________|__________________|______________|
|                        |                      |                  |              |
|                        |                      |  □  Yes  □  No   |              |
|________________________|______________________|__________________|______________|
|                                                                                 |
| Instructions for the distributor (duplication not required):                    |
|                                                                                 |
|                                                                                 |
| 1.  The distributor must describe each category on the reverse side of          |
|     this sheet.                                                                 |
|                                                                                 |
| 2.  The distributor must specify the nature of the products and services it     |
|     it wishes to offer the client.  Each information category must be           |
|     associated with a specific purpose.  Where a category serves several        |
|     purposes, the distributor must repeat it for each purpose.                  |
|                                                                                 |
| 3.  The client may give his or her authorization by telephone, provided both    |
|     parties can identify each other.  In such case, this form shall serve as a  |
|     script for the officer, who will also read the detailed description of each |
|     category to the client.  The distributor must fill out this form and send   |
|     it to the client within 10 days of obtaining the verbal consent.            |
|                                                                                 |
| 4.  If in electronic form, the initials may be replaced by a confirmation       |
|     window.  However, the notice of consent must be made available to the       |
|     client by any means allowing the reading or printing thereof.               |
|_________________________________________________________________________________|

In accordance with the Act respecting the protection of personal information in the private sector (chapter P-39.1), you may request to be given access to the information we hold pertaining to you.

SPECIFIC CONSENT

Having read the above, I, the undersigned,__________(name of client)__________ consent to use of the information held by the distributor for the purposes indicated above.

This authorization will be valid until revoked or for the following period:

______________________________________________

DD/MM/YY (to be filled out by the client)

I may revoke this consent at any time by sending a notice. I may use the attached model notice for this purpose or as a basis for preparing my own notice.

____________________________________________ ___________________________________________

(signature of client) (date of signature of the consent)

---

(client identification, address, folio or contract no., etc.)

-----------------------------------------------------------------------------------------------------------------------------------------

I HEREBY REVOKE THE SPECIFIC CONSENT GIVEN TO THE DISTRIBUTOR BY THE FOLLOWING NOTICE

To: ___________________________________________

(name of distributor)

______________________________________________

(address of distributor)

On: ___________________________________________

I, the undersigned, __________(name of client)__________ hereby notify you that

I am canceling the specific consent authorizing the communication of my personal information for new purposes.

Consent givent to you on: ______________________________________________________________________

(date of consent)

____________________________________________ _____________________________________________

(name of client) (signature of client)

---

(client identification, address, folio or contract no., etc.)

Decision 99.06.45, Sch. 3; Decision 2001.02.28, s. 1.

SCHEDULE 4

(s. 3)

DISTRIBUTION GUIDE

Name of Insurance Product:

Type of Insurance Product:

Name and Address, etc., of Insurer:

Name:

Address (electronic address, where applicable):

Telephone and fax numbers of client services:

Name and Address, etc., of Distributor:

Name:

Address (electronic address, where applicable):

Telephone and fax numbers of client services:

Responsibility of the Autorité des marchés financiers

On the title page of the guide, in a different character style, indicate the following warning:

“The Autorité des marchés financiers does not express an opinion on the quality of the product offered in this guide. The insurer alone is responsible for any discrepancies between the wording of the guide and the policy.”

Introduction:

Explain the role of the distribution guide, which is to describe the insurance product offered and facilitate the client’s comprehension by transmitting the information in a user-friendly form. The objective of the guide is to enable the client who is not in the presence of an adviser in insurance of persons or an agent or a broker in damage insurance to evaluate whether the insurance product offered corresponds to his needs.

Item 1: Description of the Product Offered

(a) Nature of the Coverage

Specify the nature of the insurance product.

(b) Summary of Specifics Features

Describe the important features of the insurance offered, including, in particular: (“di” for damage insurance and “ip” for insurance of persons)

· persons to whom protection (ip) applies;

· amount of the protection (ip);

· property or risks covered by the insurance (di);

· amount of the coverage (di);

· procedure involved in designating a beneficiary (ip);

· person to whom the benefit will be paid (di);

· premiums to be paid by the insured, whether guaranteed or not, and the payment frequency (di and ip);

· deductible applicable to claims (di);

· waiting period in the event of a claim (ip);

· benefits table (di);

· term of the contract (di and ip);

· the effective date or the expiry date of the insurance contract and the conditions attached thereto, if any, for example, a medical examination (ip);

· confirmation of the insurer set out in section 444 of the Act (ip);

· renewal procedures or conditions (di and ip);

· if the renewal of the contract (or the coverage offered) is guaranteed or not (di and ip);

· grace period pertaining to premium non-payment (di and ip);

· any other item that is likely to influence a client’s decision (di or ip).

Reference may be made to specific clauses in the policy provided that the guide has already highlighted the coverage provided.

Exclusions, restrictions or reduction in coverage

Clearly state the rules and events that may give rise to exclusions, restrictions or reduction in coverage of the insurance dealt with in the distribution guide. The exclusions must be drafted so as to allow the client to ascertain if he falls within an exclusion situation.

In addition to being in bold-face characters, the exclusions must be presented in boxes preceded by the word: “Caution”.

A reference to specific clauses in the policy may be made provided that the guide has already highlighted the exclusions.

To facilitate comprehension on the part of the client, the exclusions may, at the option of the insurer, be placed immediately following each type of coverage provided.

Cancellation

Indicate the procedure to be followed in order to cancel the insurance contract, including, in particular, the documents required, the time limit provided for the cancellation, the penalties applicable, if any, the name and address of the person to whom the notice is to be sent, and the effect of the cancellation;

(c) End of the Insurance Coverage

Explain the other circumstances terminating the protection offered by the insurance product;

(d) Other Information

Indicate how a client may obtain additional information on the product offered. Indicate that he may join the insurer or the distributor and how he may obtain a copy of the insurance contract described in the distribution guide.

Item 2: Proof of loss or claim

Explain the various steps involved in the submission of a claim, namely:

(a) Submission of a Claim

Indicate the procedure that must be followed by an insured or a beneficiary in order to submit a claim to an insurer and, in particular, specify the nature of the documents to be transmitted, the number of copies, the method of completing a claim, and the person or persons authorized to submit the claim.

Also indicate the period during which the claim or the notice of claim must be sent to an insurer.

Indicate the specific measures that must be taken by a loss victim.

(b) Insurer’s Reply

Indicate the period during which the insurer must inform the insured or a beneficiary that his claim is accepted as well as the period during which the insurer must pay the benefit. Also indicate the period during which the insurer must inform an insured or a beneficiary that his claim is refused and the reasons that warranted the decision made.

(c) Appeal of an Insurer’s Decision and Recourses

Describe the procedure to be followed by an insured or a beneficiary in the event of the refusal of his claim or non-settlement by an insurer.

Specify, in general terms, the rights of an insured in the event that an insurer fails to respect its commitments and, in particular, include a reference to the effect that the consumer may consult the Autorité des marchés financiers or his own legal adviser.

Item 3: Similar Products

Indicate whether other insurance that may include coverage similar to the insurance described in the distribution guide exists on the market.

Item 4: Referral to the Autorité des marchés financiers

For all additional information on an insurer’s and a distributor’s obligations toward a client, indicate the name, address, etc., of the Autorité des marchés financiers.

 _________________________________________________________________________________
|                                                                                 |
| PERSONAL NOTES:                                                                 |
| Coverage amount:                                                                |
| Premium:                                                                        |
| Other:                                                                          |
|                                                                                 |
|_________________________________________________________________________________|

OPTIONAL

ACKNOWLEDGEMENT OF RECEIPT:

You acknowledge receipt of this ditribution guide when you acquire the following insurance produts:

_____________________________________________________________________________________

(name of the insurance product)

Date: _____________________________________________________________________________________

(date of acknowledgement of receipt)

Per: ______________________________________________________________________________________

(name of distributor)

_____________________________________________________________________________________

(signature of client)

_____________________________________________________________________________________

(name of client)

_____________________________________________________________________________________

(address of client)

Decision 99.06.45, Sch. 4.

REFERENCES

Decision 99.06.45, 1999-06-22; Bulletin du B.S.F., 1999-11-11. n° 5

Decision 2001.02.28, 2001-02-08; Bulletin du B.S.F., 2001-03-05, n° 12

Decision 2002.03.11, 2002-03-28; Bulletin du B.S.F., 2002-04-10, n° 23

M.O. 2010-18, 2010 G.O. 2, 3986