Railway Third Party Liability Insurance Coverage Regulations (SOR/96-337)
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Regulations are current to 2024-10-30 and last amended on 2019-06-25. Previous Versions
Railway Third Party Liability Insurance Coverage Regulations
SOR/96-337
Registration 1996-07-03
Railway Third Party Liability Insurance Coverage Regulations
P.C. 1996-1063 1996-07-03
Order No. 1996-R-275
Pursuant to subsection 92(3) of the Canada Transportation ActFootnote a, the Canadian Transportation Agency hereby makes the Railway Third Party Liability Insurance Coverage Regulations in accordance with the schedule hereto.
July 2, 1996
His Excellency the Governor General in Council, on the recommendation of the Minister of Transport, pursuant to subsection 36(1) of the Canada Transportation ActFootnote a, hereby approves the annexed Railway Third Party Liability Insurance Coverage Regulations, made by the Canadian Transportation Agency.
Return to footnote aS.C. 1996, c. 10
Interpretation
1 The definitions in this section apply in these Regulations.
- Act
Act means the Canada Transportation Act. (Loi)
- applicant
applicant means a person who makes an application to the Agency for a certificate of fitness or for the variation of a certificate. (demandeur)
- deductible
deductible means the amount of risk for which an applicant retains financial responsibility under an insurance contract. (franchise)
- insurer
insurer means an insurance company that provides third party liability insurance coverage to an applicant and includes an insurance company that is wholly owned by the parties it insures. (assureur)
- named perils pollution
named perils pollution means risks that are set out in an insurance contract that are associated with seepage or pollution or contamination resulting from but not limited to collision, overturning, derailment, upset, hostile fire, lightning or explosion or other railway related accidents. (risques de pollution désignés)
- self-insurance
self-insurance means self-insured retention and deductible. (autoassurance)
- self-insured retention
self-insured retention means the amount of risk for which an applicant takes financial responsibility, outside of an insurance contract. (affectation pour autoassurance)
- third party liability insurance coverage
third party liability insurance coverage means financial compensation provided for in a contract entered into between an applicant and an insurer, or in the case of self-insurance, financial compensation provided by the applicant, in respect of the following matters arising out of an applicant’s proposed construction or operation of a railway, including a proposed temporary construction or operation of a railway resulting from unforeseen or exceptional circumstances:
(a) third party bodily injury or death, including injury or death to passengers,
(b) third party property damage, excluding damage to cargo, and
(c) named perils pollution. (assurance responsabilité civile)
Application
2 Sections 3 to 5 of these Regulations apply only to persons proposing to
(a) construct a railway; or
(b) operate a railway that relates to a passenger rail service.
Determination of Adequate Third Party Liability Insurance Coverage
3 Third party liability insurance coverage is adequate if there is
(a) sufficient insurance, including self-insurance, to compensate for the following matters that may arise out of an applicant’s proposed construction or operation of a railway, including a proposed temporary construction or operation of a railway resulting from unforeseen or exceptional circumstances:
(i) third party bodily injury or death, including injury or death to passengers,
(ii) third party property damage, excluding damage to cargo, and
(iii) named perils pollution;
(b) a written confirmation provided to the Agency by the applicant that the applicant has fully disclosed to the insurer the nature and extent of the proposed construction or operation of the railway and any associated third party liability risks; and
(c) full disclosure to the Agency by the applicant of the amount of self-insured retention and of the third party liability risks that may arise from the proposed construction or operation of the railway.
4 In determining whether third party liability insurance coverage is adequate, the Agency shall
(a) examine the risks associated with the proposed construction or operation of the railway by considering information that is provided by the applicant, including
(i) passenger ridership,
(ii) passenger and freight train miles,
(iii) volume of railway traffic,
(iv) class and volume of dangerous goods transported by rail,
(v) types of population areas served,
(vi) number of level crossings,
(vii) speed of trains,
(viii) train crew training,
(ix) method of train control, and
(x) overall safety record of the applicant; and
(b) in the case of self-insurance, assess the financial capability of the applicant to sustain the level of self-insurance, on the basis of the following information provided by the applicant:
(i) the three most recent annual financial reports that have been filed with the Agency pursuant to section 344 of the Railway Act, as that section read immediately before the coming into force of the Act, or with the Minister of Transport in accordance with any applicable regulations made pursuant to section 50 of the Act,
(ii) where the applicant does not file the reports referred to in subparagraph (i), audited financial statements for the three most recent complete fiscal years, or
(iii) where the applicant does not have the information referred to in subparagraph (i) or (ii), other financial information that establishes the applicant’s financial capability to sustain the self-insurance.
Information
5 (1) An applicant for a certificate of fitness for the proposed operation of a railway that relates to a passenger rail service or the proposed construction of a railway must provide the Agency with the information set out in Schedule 1.
(2) A holder of a certificate of fitness for the operation of a railway that relates to a passenger rail service or the construction of a railway must provide the Agency with the information set out in Schedule 1, accompanied by a description of any changes to the information that was most recently provided under this section,
(a) before the expiry of any insurance coverage and as soon as feasible after the holder has arranged for new insurance coverage to replace it; and
(b) in any case, at least once a year.
6 (1) An applicant for a certificate of fitness for the proposed operation of a railway that does not relate to a passenger rail service must provide the Agency with the information set out in Schedule 2.
(2) A holder of a certificate of fitness for the operation of a railway that does not relate to a passenger rail service must provide the Agency with the information set out in Schedule 2, accompanied by a description of any changes to the information that was most recently provided under this section,
(a) before the expiry of any insurance coverage and as soon as feasible after the holder has arranged for new insurance coverage to replace it; and
(b) in any case, at least once a year.
(3) Despite subsections (1) and (2), the information set out in item 13 of Schedule 2 is not required to be provided by
(a) an applicant for a certificate of fitness, if there will be the minimum liability insurance coverage set out in Item 4 of Schedule IV to the Act for the proposed operation; or
(b) a holder of a certificate of fitness, if the minimum liability insurance coverage set out in Item 4 of Schedule IV to the Act is maintained in respect of the operation.
SCHEDULE 1(Section 5)Information for a Certificate of Fitness for the Operation of Passenger Rail Service or the Construction of a Railway
- 1The policy number of each insurance policy.
- 2The amount of aggregate and per-occurrence coverage provided by each insurance policy for each of the risks set out in paragraph 3(a) of the Regulations.
- 3The policy form type.
- 4The period of coverage for each insurance policy.
- 5The name of each insurer and the financial strength rating given to the insurer by a financial rating agency.
- 6The amount of self-insured retention.
- 7The amount of deductible for each insurance policy.
- 8Written confirmation from the applicant’s insurance broker of the information provided in respect of items 1 to 7 of this schedule or, if the applicant does not have an insurance broker, written confirmation from each insurer of the information concerning their policy that is provided in respect of items 1 to 7.
- 9The applicant’s declaration that the following information has been disclosed to each insurer:
- (a)the nature and extent of the construction or operation of the railway and any associated third party liability risks; and
- (b)any incident, accident or occurrence that the applicant is required to disclose under the policy and that could give rise to a claim.
- 10The applicant’s declaration that the amount of per-occurrence coverage reported in item 2 is available despite any pending or accepted claims.
- 11The applicant’s declaration that they have the financial capability to pay the amounts reported for items 6 and 7.
- 12Any other information relevant to the insurance coverage and the assessment of the liabilities of the operation or construction.
SCHEDULE 2(Section 6)Information for a Certificate of Fitness for the Operation of a Railway That Does Not Relate to a Passenger Rail Service
- 1The policy number of each insurance policy.
- 2The amount of aggregate and per-occurrence coverage provided by each insurance policy for each of the risks set out in subsection 92(1.1) of the Act.
- 3The policy form type.
- 4The period of coverage for each insurance policy.
- 5The name of each insurer and the financial strength rating given to the insurer by a financial rating agency.
- 6The amount of self-insured retention.
- 7The amount of deductible for each insurance policy.
- 8Written confirmation from the applicant’s insurance broker of the information provided in respect of items 1 to 7 of this schedule or, if the applicant does not have an insurance broker, written confirmation from each insurer of the information that concerns their policy that is provided in respect of items 1 to 7.
- 9The applicant’s declaration that the following information has been disclosed to each insurer:
- (a)the nature and extent of the operation of the railway and any associated third party liability risks; and
- (b)any incident, accident or occurrence that could give rise to a claim under the policy and that the applicant is required to disclose.
- 10The applicant’s declaration that the amount of per-occurrence coverage reported in item 2 is available despite any pending or accepted claims.
- 11The applicant’s declaration that they have the financial capability to pay the amounts reported for items 6 and 7.
- 12The applicant’s audited financial statements for the three most recent complete fiscal years or, if there are no audited financial statements for each of those years, the audited financial statements for any of those years and any other relevant financial information.
- 13The traffic volumes and forecasted traffic volumes, by tonne, of TIH (Toxic Inhalation Hazard) material, crude oil and other dangerous goods as defined in section 2 of the Transportation of Dangerous Goods Act, 1992 that are or will be carried
- a)by the applicant on its railway, or the railway of another person, during
- (i)the two previous complete calendar years,
- (ii)the current calendar year, to date, and the remainder of the year, and
- (iii)the next calendar year; and
- b)by a person other than the applicant on the applicant’s railway during
- (i)the two previous complete calendar years,
- (ii)the current calendar year, to date, and the remainder of the year, and
- (iii)the next calendar year.
- 14The methodology used to forecast traffic volume for each type of commodity referred to in item 13.
- 15Any supporting documentation requested by the Agency in respect of the information referred to in item 13, including waybills and other shipping documents.
- 16Any other information relevant to the insurance coverage and the assessment of the liabilities of the operation.
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