Insurance Companies Act — I-11.8 165
Duty to manage 165 (1) Subject to this Act, the directors of a company shall manage or supervise the management of the business and affairs of the company. Specific duties (2) Without limiting the generality of subsection (1), the directors of a company shall (a) establish an audit committee to perform the duties referred to in subsections 203(3) and (4); (b) establish a conduct review committee to perform the duties referred to in subsection 204(3); (c) establish procedures to resolve conflicts of interest, including techniques for the identification of potential conflict situations and for restricting the use of confidential information; (d) designate a committee of the board of directors to monitor the procedures referred to in paragraph (c); (e) in the case of a company that issues participating policies, establish, before issuing any participating policies or, in the case of a former-Act company, within six months after the coming into force of this Part, a policy for determining the dividends and bonuses to be paid to the participating policyholders; (e.1) establish a policy respecting the management of each of the participating accounts maintained under section 456, (i) if the company has participating policyholders on the day on which this paragraph comes into force, within six months after that day, and (ii) in any other case, before issuing a participating policy; (e.2) establish criteria for changes made by the company to the premium or charge for insurance, amount of insurance or surrender value in respect of its adjustable policies, (i) if the company has adjustable policyholders on the day on which this paragraph comes into force, within six months after that day, and (ii) in any other case, before issuing an adjustable policy; (f) establish procedures to provide disclosure of information to customers of the company that is required to be disclosed by this Act and for dealing with complaints as required by section 486; (g) designate a committee of the board of directors to monitor the procedures referred to in paragraph (f) and satisfy itself that they are being adhered to by the company; (h) establish investment and lending policies, standards and procedures in accordance with section 492; and (i) in the case of a former-Act company, appoint the actuary of the company forthwith after the coming into force of this Part. Exception (3) Paragraphs (2)(a) and (b) do not apply to the directors of a company where (a) all the voting shares of the company, other than directors’ qualifying shares, if any, are beneficially owned by a Canadian financial institution described by any of paragraphs (a) to (d) of the definition financial institution in subsection 2(1); (b) there are no policyholders who are entitled to vote; and (c) the audit committee or the conduct review committee of the Canadian financial institution referred to in paragraph (a) performs for and on behalf of the company all the functions that would otherwise be required to be performed by the audit committee or conduct review committee of the company under this Act. Report of actuary — par. (2)(e) (3.1) The company’s actuary shall report to the directors in writing on the fairness to participating policyholders of any policy to be established or amended under paragraph (2)(e) and report at least once during each financial year on its continuing fairness. In the case of a policy established before the day on which this subsection comes into force, the actuary shall within six months after that day report on its fairness to participating policyholders and report at least once during each financial year on its continuing fairness. Report of actuary — par. (2)(e.1) (3.2) The company’s actuary shall report to the directors in writing on the fairness to participating policyholders of any policy to be established or amended under paragraph (2)(e.1) and report at least once during each financial year on its continuing fairness. Report of actuary — par. (2)(e.2) (3.