TORONTO, June 13, 2012 /CNW/ - Canada's life and health insurers today
expressed their deep concern and disappointment with the Manitoba
government's imposition of the Retail Sales Tax (RST) on individual
disability insurance, critical illness insurance and group disability
insurance coverage for Manitobans.
"This is not good public policy. It will increase the cost to Manitoba
businesses, and more importantly, to families trying to protect
themselves in the event of disability. Adding sales tax will put them
at greater financial risk," said Frank Swedlove, President of the
Canadian Life and Health Insurance Association (CLHIA). Manitoba-based
Great-West Life and Wawanesa Life are both members of the CLHIA.
"Discouraging Manitobans from protecting their families and businesses
may ultimately add to the province's fiscal burden rather than
generating positive net revenue," Swedlove said. For example, if
Manitobans can no longer afford privately administered disability and
critical illness due to this tax burden, the public sector will need to
provide funding for needs that are currently covered by those products.
A sales tax on group insurance policies would also raise costs for
Manitoba companies, putting them at a disadvantage with regards to
their competitors in other provinces.
Furthermore, the life and health insurance industry expressed its
concern at the expanded scope from the initial budget announcement, and
the lack of consultation with the industry. "This is a major expansion
of the tax on consumers from what was announced on Budget Day," noted
The proposed legislation would now apply to premiums associated with
disability, critical illness and accidental death and dismemberment for
both group and individual insurance policies, as well as for all forms
of group creditor insurance and a significant number of individual life
Furthermore, Swedlove noted that Bill 39 will not be submitted for
formal review by a Standing Committee of the Legislative Assembly,
thereby preventing Manitobans and their employers from communicating
their concerns to the government.
Canada's life and health insurance industry directly employs almost
7,000 Manitobans and has approximately $17 billion invested in the
province, primarily in long term investments in government bonds and
other employers, creating jobs for many more Manitoba residents.
The Canadian life and health insurance industry provides a wide range of
financial security products such as life insurance, annuities
(including RRSPs, RRIFs and pensions) and supplementary health
insurance, to about 26 million Canadians. Established in 1894, the
CLHIA is a voluntary association whose member companies account for 99
per cent of Canada's life and health insurance business.
SOURCE Canadian Life and Health Insurance Association Inc.
For further information:
Media inquiries contact:
CLHIA: Wendy Hope, Vice President, External Relations (416)777-2221 or (613) 986-1853