Assented to 2011-06-26
An Act to authorize, in certain circumstances, the making of payments or the purchase of replacement insurance by Her Majesty in respect of certain types of mortgage or hypothecary insurance provided by an insurance company in respect of which a winding-up order is made and to terminate certain agreements relating to mortgage or hypothecary insurance
Marginal note:Short title
1 This Act may be cited as the Protection of Residential Mortgage or Hypothecary Insurance Act.
2 The following definitions apply in this Act.
- approved mortgage insurer
approved mortgage insurer means a mortgage insurer that is designated under section 4. (assureur hypothécaire agréé)
company means the Canada Guaranty Mortgage Insurance Company, the Genworth Financial Mortgage Insurance Company Canada, the PMI Mortgage Insurance Company Canada or any successor to any of those companies. (société)
(a) in Ontario, the Superior Court of Justice;
(b) in Quebec, the Superior Court of the province;
(c) in Nova Scotia and British Columbia, the Supreme Court of the province;
(d) in New Brunswick, Manitoba, Saskatchewan and Alberta, the Court of Queen’s Bench for the province;
(e) in Prince Edward Island and Newfoundland and Labrador, the trial division of the Supreme Court of the province; and
(f) in Yukon and the Northwest Territories, the Supreme Court of the territory, and in Nunavut, the Nunavut Court of Justice. (tribunal)
- eligible mortgage loan
eligible mortgage loan means a mortgage or hypothecary loan that meets the criteria established by regulations made under subsection 42(1). (prêt hypothécaire admissible)
- Her Majesty
Her Majesty means Her Majesty in right of Canada. (Sa Majesté)
liquidator means a liquidator appointed under the Winding-up and Restructuring Act or a similar official appointed under any other Act of Parliament relating to insolvency or bankruptcy. (liquidateur)
Minister means the Minister of Finance. (ministre)
- mortgage insurer
mortgage insurer means a corporation referred to in subsection 13(1) of the Insurance Companies Act and that is approved by the Superintendent to sell mortgage or hypothecary insurance in Canada. (assureur hypothécaire)
policy means any written contract of insurance in respect of an eligible mortgage loan, whether contained in one or more documents, entered into by an approved mortgage insurer and a qualified mortgage lender that has been designated as such by the approved mortgage insurer. (police)
prescribed means prescribed by regulations made under section 41. (Version anglaise seulement)
- qualified mortgage lender
qualified mortgage lender means a mortgage or hypothecary lender that has been designated under section 10. (prêteur hypothécaire qualifié)
Superintendent means the Superintendent of Financial Institutions appointed under the Office of the Superintendent of Financial Institutions Act. (surintendant)
- winding-up order
winding-up order means a winding-up order made under the Winding-up and Restructuring Act or a similar order made under any other Act of Parliament relating to insolvency or bankruptcy. (ordonnance de mise en liquidation)
3 The purposes of this Act are
(a) to authorize the Minister to provide protection in respect of certain mortgage or hypothecary insurance contracts in order to support the efficient functioning of the housing finance market and the stability of the financial system in Canada; and
(b) to mitigate the risks arising from the provision of that protection.
Approved Mortgage Insurers
4 (1) At the written request of a mortgage insurer, the Minister may, after consulting with the Superintendent, designate the mortgage insurer as an approved mortgage insurer for the purposes of this Act.
Marginal note:Term of designation
(2) The designation or its renewal are in effect for any period that the Minister specifies.
Marginal note:Suspension of designation
5 (1) After consulting with the Superintendent, the Minister may, by notice sent to an approved mortgage insurer, suspend the approved mortgage insurer’s designation if the Minister is of the opinion that the approved mortgage insurer has failed to comply with any provision of this Act or the regulations.
Marginal note:Effective date and length
(2) The notice must set out the effective date and the length of the suspension.
(3) An approved mortgage insurer that has had its designation suspended must not insure any new mortgage or hypothecary loans until the suspension expires or is cancelled by the Minister.
Marginal note:Obligations during suspension
(4) For as long as the designation of an approved mortgage insurer is suspended, the approved mortgage insurer remains subject to the provisions of this Act and the regulations and must meet any conditions imposed by the Minister and satisfy any undertakings required by him or her.
Marginal note:Cancellation of suspension
(5) The Minister may cancel a suspension if he or she considers it appropriate to do so.
Marginal note:Cancellation of designation
(a) the Minister is of the opinion that the approved mortgage insurer has failed to comply with any provision of this Act or the regulations;
(b) a winding-up order is made in respect of the approved mortgage insurer;
(c) the approved mortgage insurer ceases to be a mortgage insurer; or
(d) the approved mortgage insurer requests in writing that its designation be cancelled.
Marginal note:Effective date of cancellation
(2) The notice must set out the effective date of the cancellation.
(3) As soon as feasible after sending the notice, the Minister must cause the name of the approved mortgage insurer whose designation is cancelled and the effective date of the cancellation to be published in the Canada Gazette.
Marginal note:Obligations after cancellation
(4) After the designation of a corporation as an approved mortgage insurer is cancelled and for as long as the Minister has any actual or potential obligations under section 16 in respect of the policies the corporation issued or the contracts of insurance it entered into that could be deemed to be policies under section 19, the corporation remains subject to sections 8 and 15 and the regulations related to those sections, as if it were still an approved mortgage insurer, and it must meet any conditions imposed by the Minister and satisfy any undertakings required by him or her.
Marginal note:Company never designated
7 (1) For the period referred to in subsection (2), a company that has never been designated as an approved mortgage insurer is subject to sections 8 and 15 and the regulations related to those sections, as if it were an approved mortgage insurer, and must meet any conditions imposed by the Minister and satisfy any undertakings required by him or her.
(2) The period is the length of time that the Minister has any actual or potential obligations under section 16 in respect of the contracts of insurance the company entered into that could be deemed to be policies under section 19.
Marginal note:Adequacy of capital
8 (1) In order to mitigate the risks to Her Majesty that arise from the provision of mortgage or hypothecary insurance protection under this Act, an approved mortgage insurer must, in relation to its business and in addition to the capital it is required to maintain under the Insurance Companies Act, maintain adequate capital.
Marginal note:Adequacy determined by Minister
(2) The adequate level of capital is to be determined by the Minister after considering the advice of the Superintendent.
- Date modified: