Sun Life of Canada

  • 2010 - LC - Sun Life Assurance Company of Canada v. Metropolitan Life Insurance Company - Judgement - Ontario - Superior Court   ---  [BonkNote]  ---  8p 
  • Fehr v Sun Life Assurance Company of Canada - Ontario - [BonkNote]
    • 2018 0905 - LC - Fehr v Sun Life - Decision - Ontario - Court of Appeal  ---  [BonkNote]  ---  73p
  • Vanishing Premiums
  • 10 Up until the early 1990s there was a rule stating that equities could not make up more than 25 percent of assets, yet Canadian insurers were generally well below that.
    • The more conservative practices of Canadian insurers may go back to the depression, when Sun Life, the largest insurer at the time, would have been insolvent on a market value basis.
      • The company was heavily invested in equities, as well as farm mortgages, and the value of these assets plunged.
      • The government allowed Sun Life to use what they called “authorized values,” which were neither market nor book, but were determined in such a way as to enable the company to still appear to be solvent.

2009 - Journal of Insurance Issues - An Examination of Property & Casualty Insurer Solvency in Canada, by Anne E. Kleffner and Ryan B. Lee, 32(1): 52-77 - 27p

  • The sale of par business on a vanishing-premium basis has been well established in the last few years.
  • Dividend reductions can lead to unpleasant surprises, to the extent that policyholders and agents have relied on a continuation of the current dividend scale to fund the vanish year.
    • Prudence and recent history suggest that vanish years should be carefully explained, and perhaps illustrated, with some margin for dividend reduction.
  • Companies and agents that are service-oriented will find ways to communicate to policyholders changes in their vanish year before the arrival of a surprise announcement that more money is necessary or that the insurance program will either pay less than expected or terminate prematurely.

--  Robert J. Smardon, Vice President of Individual Products for the U.S. operations of Sun Life of Canada

1991 - SOA - Life Products, Society of Actuaries - 22p