The RBSF-I (formerly: Insurance Prudential Supervisory Framework) sets out FSRA’s approach for supervision of Ontario’s provincially incorporated Insurance Companies and Reciprocals (“Insurers”). Its primary focus is to determine the impacts of current and potential future events, both internal and external, on the risk profile of each Insurer, and drive FSRA’s allocation of supervisory resources.

This Guidance articulates FSRA’s supervisory approach for all Insurers, as well as the practices and processes for determining an Insurer’s Overall Risk Rating (“ORR”), Intervention Level (IL), and level of FSRA’s Level of Supervisory Engagement (LSE) in line with the Insurance Act (the “Act”), supporting Regulations and FSRA Rules and Guidance.

This Approach Guidance does not prescribe compliance obligations for Insurers. Rather, it is intended to define the processes and practices that FSRA will follow when establishing supervisory plans and exercising supervisory assessments, actions or discretion powers under the Act.

The level and extent of supervision under the RBSF-I will depend on the size, complexity, and risk profile of the Insurer, and the potential consequences of an Insurer’s failure including impact to the rest of the sector.

Rationale for title change

The title of this Guidance has been changed from Insurance Prudential Supervisory Framework (IPSF) to the Risk Based Supervisory Framework for Ontario-incorporated Insurance Companies and Reciprocals (RBSF-I).  The new title accurately reflects the integrated nature of the framework set out in the Guidance, which includes components related to both market conduct and prudential supervision, as well as emphasizing that the framework is risk-based.

Stakeholder consultation

On July 5, 2022, FSRA published the draft RBSF-I Approach Guidance for public consultation which lasted from July 5 to September 6, 2022, after engaging with its Technical Advisory Committee on Insurance Prudential Regulation and Supervision.

Outcome of the consultation

FSRA appreciates and has carefully considered all consultation comments and feedback and has decided to not make any substantive changes to the RBSF-I at this time. Changes were made to streamline the document and clarify the risk based supervisory approach.

Feedback from the consultation

FSRA would like to thank all stakeholders that commented on the approach guidance. FSRA has carefully considered all comments before finalizing and publishing the final guidance.

Feedback summary and responses

FSRA received written submissions from the following 12 stakeholders, which are available on FSRA’s website:

Organization Representative
1. Canadian Universities Reciprocal Insurance Exchange (CURIE) Patrick Daniel Lundy, CEO and Attorney-in-fact
2. Healthcare Insurance Reciprocal of Canada (HIROC) Catherine Gaulton, CEO
3. Ontario School Boards’ Insurance Exchange (OSBIE) Sandra Taylor, CFO
4. Canadian Association of Insurance Reciprocals (CAIR) Sandra Taylor, Chair
5. Ontario Mutual Insurance Association (OMIA) John L. Taylor, President
6. Ayr Farmers Mutual Jeff Whiting, President and CEO
7. Lambton Mutual Insurance Company Deborah Van Eyk, President and CEO
8. Trillium Mutual Insurance Company Tracy MacDonald, President and CEO
9. South EastHope (SE) Mutual Insurance Frank A. Rider, President and CEO
10. Usborne & Hibbert Mutual Fire Insurance Shelagh E. Cleary, President and CEO
11. Financial Examination Committee (FEC) Catherine MacLellan, Rick Walters, Bob Nielson, and Jeff Wickware
12. Germania Mutual Insurance Daniel Hill, CEO and President