I-3, r. 1 - Regulation respecting the Taxation Act

Section 818r53.2 Disposition versions

2023-09-26

818R53.2. Canadian reserve liabilities of an insurer at the end of a taxation year means the amount determined by the following formula:

A – B + C + D – (0.9 × E) – [F – (0.9 × G)].

In the formula in the first paragraph,

(a)  A is the total of the insurer’s liabilities and reserves including liabilities for segregated fund guarantees (other than policyholders’ liabilities or a liability in respect of an obligation to pay a benefit under a segregated fund policy in respect of which subparagraphs i and ii of paragraph b of section 840R12 apply) reported by the insurer as at the end of the taxation year in respect of

i.  life insurance policies in Canada,

ii.  fire insurance policies issued or effected in respect of property situated in Canada, and

iii.  insurance policies of any other class covering risks ordinarily within Canada at the time the policy was issued or effected; and

(b)  B is the aggregate of all amounts each of which is the amount of an item reported by the insurer as an insurance contract asset as at the end of the taxation year in respect of insurance policies described in any of subparagraphs i to iii of subparagraph a;

(c)  C is the aggregate of all amounts each of which is an amount of funds withheld as at the end of the taxation year by the insurer in respect of the reinsurance of a risk under an insurance policy described in any of subparagraphs i to iii of subparagraph a;

(d)  D is the aggregate of all amounts each which is an amount recoverable as at the end of the taxation year by the insurer under a funds withheld arrangement in respect of the reinsurance of a risk by the insurer under an insurance policy described in any of subparagraphs i to iii of subparagraph a;

(e)  E is the aggregate of all amounts each of which is, in respect of a group of insurance contracts of the insurer at the end of the taxation year,

i.  the contractual service margin for the group, if no portion of the contractual service margin is in respect of a policy other than a policy that

(1)  is described in any of subparagraphs i to iii of subparagraph a,

(2)  is a life insurance policy in Canada, a policy that insures risk in respect of a financial loss of a lender on a loan made on the security of an immovable property, a non-cancellable or guaranteed renewable accident and sickness policy in respect of accident and sickness insurance, within the meaning of section 152R1, or a policy in respect of title insurance, within the meaning of that section, and

(3)  is not a segregated fund policy, or

ii.  in any other case, the amount that would be the contractual service margin for the group if the contractual service margin were determined without taking into account the portion that is in respect of policies other than policies that meet the conditions in subparagraphs 1 to 3 of subparagraph i;

(f)  F is the aggregate of all amounts each of which is an amount, in respect of a group of reinsurance contracts held by the insurer at the end of the taxation year, that is

i.  the reinsurance contract held amount for the group, if no portion of the reinsurance contract held amount is in respect of the reinsurance of

(1)  a risk under a policy other than a policy that meets the condition in subparagraph 1 of subparagraph i of subparagraph e, or

(2)  an obligation to pay a benefit under a segregated fund policy in respect of which subparagraphs i and ii of paragraph b of section 840R12 apply, or

ii.  in any other case, the amount that would be the reinsurance contract held amount for the group if the amount were determined without taking into account any portion that is in respect of the reinsurance of

(1)  a risk under a policy other than a policy that meets the condition in subparagraph 1 of subparagraph i of subparagraph e, or

(2)  an obligation to pay a benefit under a segregated fund policy in respect of which subparagraphs i and ii of paragraph b of section 840R12 apply; and

(g)  G is the aggregate of all amounts each of which is an amount, in respect of a group of reinsurance contracts held by the insurer at the end of the taxation year, that is

i.  if no portion of the contractual service margin for the group is in respect of a risk under a policy other than a policy that meets the conditions in subparagraphs 1 to 3 of subparagraph i of subparagraph e, the contractual service margin for the group, or

ii.  in any other case, the amount that would be the contractual service margin for the group if the contractual service margin were determined without taking into account any portion that is in respect of the reinsurance of a risk under a policy other than a policy that meets the conditions in subparagraphs 1 to 3 of subparagraph i of subparagraph e.

O.C. 701-2013, s. 31; S.Q. 2023, c. 19, s. 151.

2013-07-03

818R53.2. Canadian reserve liabilities of an insurer at the end of a taxation year means the amount determined by the following formula:

A - B.

In the formula in the first paragraph,

(a)  A is the total of the insurer’s liabilities and reserves, other than liabilities and reserves in respect of a segregated fund, at the end of the taxation year, in respect of

i.  life insurance policies in Canada,

ii.  fire insurance policies issued or effected in respect of property situated in Canada, and

iii.  insurance policies of any other class covering risks ordinarily within Canada at the time the policy was issued or effected; and

(b)  B is the aggregate of the reinsurance recoverable reported as a reinsurance asset by the insurer at the end of the year relating to its liabilities and reserves described in subparagraph a.

O.C. 701-2013, s. 31.