Variable Life Benefits
Regulation Number(s):
Pension Benefit
Instrument Type:
Policy
Bill or Act:
Pension Benefits Act
Summary of Proposal:
In 2021, the federal government made amendments to the federal Income Tax Act (ITA) to permit Canadian jurisdictions to regulate a new pension option that can be offered to members called a Variable Life Benefit (VLB). A VLB, often also referred to as a variable payment life annuity, can be paid from pooled registered pension plans, defined contribution pension plans, and those pension plans that provide for additional voluntary contributions (AVCs). Retirees who choose a VLB would receive a lifetime monthly benefit with payments that are adjusted based on the investment performance of the fund and mortality experience of the fund's members.
The Ministry is seeking to gather input and perspectives on a future framework for VLBs that provides new lifetime option for retirees, where members' interests are protected.
In order to establish VLBs in Ontario, amendments to the Pension Benefits Act (PBA) and the Pooled Registered Pension Plans Act, 2015 (PRPPA) would be required.
Feedback on the consultation questions can be provided through the Ontario Regulatory Registry or sent directly to the Ministry at pension.feedback@ontario.ca
Please note that the deadline to provide technical comments is January 10, 2025 at 11:59 pm.
Analysis of Regulatory Impact:
The Ministry is consulting on a future legislative and regulatory framework. A future regulatory impact assessment will be completed once the specific legislative framework is developed.
Further Information:
Proposal Number:
24-MOF023
Posting Date:
November 12, 2024
Comments Due Date:
January 10, 2025
Contact Address:
Pension Policy Branch
Ministry of Finance
5th Floor, Frost Building South
7 Queen's Park Crescent East
Toronto, ON
M7A 1Y7
or
Pension.Feedback@ontario.ca