Automobile Insurance Rate Stabilization Act, 2003

1 (1) In this Act, “authorized rate” means, in respect of a contract of automobile insurance, the rate the insurer is authorized under this Act to charge on the issue or renewal of the contract; (“taux autorisé”) “insurer” means a person who undertakes or agrees or offers to undertake a contract of automobile insurance and includes the Facility Association. (“assureur”) 2003, c. 9, s. 1; 2005, c. 31, Sched. 2, s. 1; 2013, c. 2, Sched. 1, s. 1 (1). Interpretation (2) Expressions used in this Act have the same meaning as in the Insurance Act, unless the context requires otherwise. 2013, c. 2, Sched. 1, s. 1 (2). Section Amendments with date in force (d/m/y) 2005, c. 31, Sched. 2, s. 1 - 15/12/2005 2013, c. 2, Sched. 1, s. 1 (1, 2) - 16/08/2013

2 (1) This Act applies to insurers and contracts of automobile insurance, but only with respect to the Personal Vehicles — Private Passenger Automobile category of automobile insurance. 2013, c. 2, Sched. 1, s. 2 (1). Same (2) This Act does not apply to an insurer in respect of any category or coverage of automobile insurance for which the insurer is not required to make an application for approval under section 410 of the Insurance Act by reason of an exemption granted under subsection 413 (1) of that Act. 2003, c. 9, s. 2 (2). (3) Repealed: 2013, c. 2, Sched. 1, s. 2 (2). Section Amendments with date in force (d/m/y) 2013, c. 2, Sched. 1, s. 2 (1, 2) - 16/08/2013

2.1 (1) This section establishes an industry-wide target for the reduction of rates that insurers are permitted to charge for the Personal Vehicles — Private Passenger Automobile category of automobile insurance. 2013, c. 2, Sched. 1, s. 3. Target (2) The target is a 15 per cent reduction in the average of the authorized rates that may be charged by all insurers. The average is to be determined in accordance with the regulations, and the reduction must be achieved during the period prescribed by regulation. 2013, c. 2, Sched. 1, s. 3. Periodic reductions (3) The regulations may provide for periodic reductions toward the target and may specify the period within which each such reduction must be achieved. 2013, c. 2, Sched. 1, s. 3. Applications by insurers (4) When making an application under section 3 or 7 or making written submissions under section 7.1, every insurer is required to prop…

3 (1) Every insurer shall apply to the Chief Executive Officer for approval of, (a) the risk classification system it intends to use in determining the rates for each coverage for the Personal Vehicles — Private Passenger Automobile category of automobile insurance; and (b) the rates it intends to use for each coverage for that category of automobile insurance. 2013, c. 2, Sched. 1, s. 4; 2018, c. 17, Sched. 4, s. 1. Material to be furnished (2) An application for approval of a risk classification system or rates shall be in a form approved by the Chief Executive Officer and shall be filed together with such information, material and evidence as the Chief Executive Officer may specify. 2013, c. 2, Sched. 1, s. 4; 2018, c. 17, Sched. 4, s. 1. Additional information (3) The Chief Executive Officer may require an applicant to provide such additional information, material and evidence as the…

4 (1) No insurer shall apply to the Chief Executive Officer under section 410 of the Insurance Act for approval of a risk classification system or rates for the Personal Vehicles — Private Passenger Automobile category of automobile insurance. 2013, c. 2, Sched. 1, s. 5; 2018, c. 17, Sched. 4, s. 1. Same (2) No insurer shall submit or resubmit an application to the Chief Executive Officer under subsection 411 (5) of the Insurance Act for approval of a risk classification system or rates for the Personal Vehicles — Private Passenger Automobile category of automobile insurance. 2013, c. 2, Sched. 1, s. 5; 2018, c. 17, Sched. 4, s. 1. Suspension of approvals (3) The Chief Executive Officer shall not approve an application under section 410 of the Insurance Act, or an application submitted or resubmitted under subsection 411 (5) of that Act, for approval of a risk classification system or ra…

5 Repealed: 2013, c. 2, Sched. 1, s. 6. Section Amendments with date in force (d/m/y) 2013, c. 2, Sched. 1, s. 6 - 16/08/2013

6 Repealed: 2013, c. 2, Sched. 1, s. 6. Section Amendments with date in force (d/m/y) 2013, c. 2, Sched. 1, s. 6 - 16/08/2013

7 (1) The Chief Executive Officer may order any insurer that is subject to this Act to apply to the Chief Executive Officer for approval of, (a) the risk classification system it intends to use, as of the date specified in the order, in determining the rates for each coverage for the Personal Vehicles — Private Passenger Automobile category of automobile insurance; and (b) the rates it intends to use, as of the date specified in the order, for each coverage for that category of automobile insurance. 2013, c. 2, Sched. 1, s. 7 (1); 2018, c. 17, Sched. 4, s. 1. (2) Repealed: 2013, c. 2, Sched. 1, s. 7 (2). Application (3) On receipt of an order under subsection (1), an insurer shall make the application in a form approved by the Chief Executive Officer and shall, on or before the date specified in the order, file the application together with such information, material and evidence as the …

7.1 (1) The Chief Executive Officer may notify an insurer that the Chief Executive Officer intends to make an order with respect to the risk classification system or rates for any coverage for the Personal Vehicles — Private Passenger Automobile category of automobile insurance of the insurer if, in the Chief Executive Officer’s opinion, (a) the current risk classification system or current rate is not just and reasonable in the circumstances; (b) the current risk classification system is not reasonably predictive of risk or does not distinguish fairly between risks; (c) the current rates would impair the insurer’s solvency; or (d) the current rates are excessive in relation to the insurer’s financial circumstances. 2013, c. 2, Sched. 1, s. 8; 2018, c. 17, Sched. 4, s. 1, 2. Written submissions (2) The Chief Executive Officer shall give the insurer an opportunity to make written submissi…

8 For the Personal Vehicles — Private Passenger Automobile category of automobile insurance, no insurer shall charge a rate other than the authorized rate. 2013, c. 2, Sched. 1, s. 9. Section Amendments with date in force (d/m/y) 2013, c. 2, Sched. 1, s. 9 - 16/08/2013

9 After the repeal of subsection 4 (1) under section 14, the rates and risk classification system of an insurer as approved under this Act shall, for the purposes of sections 410, 411, 412, 415 and 417 of the Insurance Act, be deemed to be the rates and risk classification systems approved for use by the insurer under the Insurance Act. 2003, c. 9, s. 9; 2013, c. 2, Sched. 1, s. 10. Section Amendments with date in force (d/m/y) 2013, c. 2, Sched. 1, s. 10 - 16/08/2013

10 The Chief Executive Officer may examine and investigate the affairs of an insurer to determine if the insurer is committing any act or pursuing a course of conduct that is a contravention of this Act or that might reasonably be expected to result in a situation that would constitute a contravention of this Act. 2003, c. 9, s. 10; 2018, c. 17, Sched. 4, s. 1. Section Amendments with date in force (d/m/y) 2018, c. 17, Sched. 4, s. 1 - 08/06/2019

11 (1) If, in the opinion of the Chief Executive Officer, an insurer is committing any act or pursuing a course of conduct that is a contravention of this Act or that might reasonably be expected to result in a situation that would constitute a contravention of this Act, the Chief Executive Officer may, without giving prior notice, make an order to take effect immediately on its making, (a) requiring the insurer to cease doing or to refrain from doing any act or pursuing any course of conduct identified by the Chief Executive Officer; (b) requiring the insurer to perform any act that, in the opinion of the Chief Executive Officer, is necessary to remedy the situation, including requiring an insurer to reimburse an insured in respect of any excess premium paid by the insured to the insurer by reason of the insurer’s contravention of this Act; or (c) suspending or cancelling the insurer’s …

11.1 In sections 11.2 to 11.7, “requirement established under this Act” means, (a) a requirement imposed by a provision of this Act that is prescribed for the purpose of section 11.3 or 11.4, (b) a requirement imposed by order, or (c) an obligation assumed by way of undertaking. 2012, c. 8, Sched. 2, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, s. 1 - 01/01/2013

11.2 (1) An administrative penalty may be imposed under section 11.3 or 11.4 for either of the following purposes: 1. To promote compliance with the requirements established under this Act. 2. To prevent a person from deriving, directly or indirectly, any economic benefit as a result of contravening or failing to comply with a requirement established under this Act. 2012, c. 8, Sched. 2, s. 1. Same (2) An administrative penalty may be imposed alone or in conjunction with any other regulatory measure provided by this Act, including an order under section 11. 2012, c. 8, Sched. 2, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, s. 1 - 01/01/2013

11.3 (1) If the Chief Executive Officer is satisfied that an insurer is contravening or not complying with or has contravened or failed to comply with any of the following, the Chief Executive Officer may, by order, impose an administrative penalty on the insurer in accordance with this section and the regulations: 1. A provision of this Act as may be prescribed. 2. A requirement or obligation described in clause (b) or (c) of the definition of “requirement established under this Act” in section 11.1. 2012, c. 8, Sched. 2, s. 1; 2018, c. 17, Sched. 4, s. 1. Procedure (2) If the Chief Executive Officer proposes to impose an administrative penalty under subsection (1), the procedure set out in section 441.3 of the Insurance Act applies, with necessary modifications. 2012, c. 8, Sched. 2, s. 1; 2018, c. 17, Sched. 4, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, …

11.4 (1) If the Chief Executive Officer is satisfied that an insurer is contravening or not complying with or has contravened or failed to comply with a provision of this Act as may be prescribed, the Chief Executive Officer may, by order, impose an administrative penalty on the insurer in accordance with this section and the regulations. 2012, c. 8, Sched. 2, s. 1; 2018, c. 17, Sched. 4, s. 1. Procedure (2) The procedure set out in section 441.4 of the Insurance Act applies, with necessary modifications, to the imposition of an administrative penalty under subsection (1). 2012, c. 8, Sched. 2, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, s. 1 - 01/01/2013 2018, c. 17, Sched. 4, s. 1 - 08/06/2019

11.5 (1) An administrative penalty imposed on an insurer under section 11.3 shall not exceed $200,000 or such lesser amount as may be prescribed for a prescribed requirement established under this Act. 2012, c. 8, Sched. 2, s. 1. Same (2) An administrative penalty imposed on an insurer under section 11.4 shall not exceed $25,000 or such lesser amount as may be prescribed for a prescribed requirement established under this Act. 2012, c. 8, Sched. 2, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, s. 1 - 01/01/2013

11.6 Section 441.6 of the Insurance Act applies, with necessary modifications, with respect to the payment and enforcement of administrative penalties imposed under this Act. 2012, c. 8, Sched. 2, s. 1. Section Amendments with date in force (d/m/y) 2012, c. 8, Sched. 2, s. 1 - 01/01/2013

11.7 The Lieutenant Governor in Council may make regulations governing the administrative penalties that may be imposed under sections 11.3 and 11.4 and, without limiting the generality of the foregoing, may make regulations, (a) prescribing provisions of this Act for the purposes of sections 11.3 and 11.4; (b) prescribing criteria the Chief Executive Officer is required or permitted to consider when imposing a penalty under section 11.3 or 11.4; (c) prescribing the amount of a penalty, or the method for calculating the amount of a penalty, and prescribing different penalties or ranges of penalties for different types of contraventions or failures to comply; (d) authorizing the Chief Executive Officer to determine the amount of a penalty, if the amount of the penalty or the method for calculating the amount of the penalty is not prescribed, and prescribing criteria the Chief Executive Of…

12 (1) Every insurer that does any of the following is guilty of an offence and on conviction is liable on a first conviction to a fine of not more than $250,000 and on each subsequent conviction to a fine of not more than $500,000: 1. Contravenes subsection 3 (1) or 7 (3) or section 8. 2. Fails to comply with an order of the Chief Executive Officer made under section 11. 3. Directly or indirectly furnishes false, misleading or incomplete information, material or evidence to the Chief Executive Officer under this Act. 2003, c. 9, s. 12 (1); 2012, c. 8, Sched. 2, s. 2; 2013, c. 2, Sched. 1, s. 11; 2018, c. 17, Sched. 4, s. 1. Derivative offence (2) Every director, officer and chief agent of an insurer is guilty of an offence who, (a) causes, authorizes, permits or participates in the insurer committing an offence under this Act; or (b) fails to take reasonable care to prevent the insurer …

13 Section 33 of the Insurance Act applies to documents required or permitted to be submitted under this Act and to orders made under this Act. 2003, c. 9, s. 13. Repeal 14 (1) This Act is repealed on a day to be named by proclamation of the Lieutenant Governor. 2003, c. 9, s. 14 (1). Same (2) Any proclamation referred to in subsection (1) may apply to the whole or any part or parts or portion or portions or section or sections of this Act, and proclamations may be issued at different times as to any part or parts or portion or portions or section or sections of this Act. 2003, c. 9, s. 14 (2).

15 Omitted (provides for coming into force of provisions of this Act). 2003, c. 9, s. 15.

16 Omitted (enacts short title of this Act). 2003, c. 9, s. 16. ______________