Proposed Amendments to Ontario Regulation 193/18 Concerning the Purchase of Pension Benefits from an Insurance Company
Regulation - LGIC
Bill or Act:
Pension Benefits Act, 1990
Summary of Proposal:
The Pension Benefits Act (PBA) was amended in the fall of 2017 to enable pension plan administrators to be discharged from their pension responsibilities if they purchase annuities for certain plan members, subject to certain conditions. Regulations that set out requirements (in addition to those set out in the Act) that must be met before an administrator is discharged took effect on July 1, 2018.
In response to concerns raised by stakeholders, technical amendments were made to the PBA in the fall of 2018 to clarify the annuity discharge provision.
The proposed regulatory amendments to Regulation 193/18 would support these technical amendments by:
• Aligning the definition of "solvency ratio" in Regulation 193/18 with the definition in Regulation 909 under the PBA;
• Setting out conditions, such as notification and funding requirements, under which discharge is provided when annuities are bought for surviving spouses; and
• Specifying the funding requirements when annuities are adjusted at a later date in order to obtain discharge.
Analysis of Regulatory Impact:
Administrative costs to business would not increase as a result of this regulatory proposal as the proposal does not introduce new policy; it rather clarifies an existing policy.
April 11, 2019
Comments Due Date:
May 3, 2019
BPS Pension Initiatives Unit, BPS Pensions Branch
Ministry of Finance
1st Floor, Frost Building South
7 Queen's Park Crescent East