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| This Act is current to May 13, 2025 | |||
| See the Tables of Legislative Changes for this Act’s legislative history, including any changes not in force. |
[Note: This Act was last revised for the 1960 Statute Revision; references to other Acts in provisions not since amended may not be current.]
Interpretation
2 (1) In this Act, unless the context otherwise requires,
"member" means a holder of a subsisting mutual-insurance policy issued by a mutual company;
"mutual fire insurance company" means a company organized in terms of this Act and, except to the extent authorized under section 8 (e), empowered only to transact mutual-insurance business;
"mutual insurance" means general insurance, as defined in the Financial Institutions Act, given in consideration for a premium note as provided by this Act, with or without a cash payment;
means an instrument given as consideration for insurance whereby the maker undertakes to pay such sum or sums as may be legally demanded by the insurer, but the aggregate of which sums does not exceed an amount specified in the instrument;
"Registrar" means the Registrar of Companies or a person authorized to perform the duties of the Registrar of Companies under the Business Corporations Act;
"rural" means situate outside the bounds or area of any municipality incorporated as a city or city municipality by or under any general or special Act of the Legislature;
means a holder of a share or shares of guarantee capital issued by a mutual company under this Act;
"Superintendent" means the Superintendent of Financial Institutions.
(2) A reference in this Act to a "company" or to a "mutual company" is to be read as a reference to a "mutual fire insurance company".
RS1960-262-2; 1968-53-13; 1989-47-386; 1998-11-12; B.C. Reg. 18/2010; 2016-21-17; 2023-10-710; 2024-10-39.
Incorporation
3 Any thirty or more persons who have each an insurable interest in rural property, real or personal, exposed to damage by fire, who desire to form a mutual fire insurance company under this Act may, subject to the approval of the Superintendent, make, sign, and acknowledge (in duplicate) before some person competent to take the acknowledgement of deeds, and file in the office of the Registrar (who is hereby authorized to receive and file the same), a certificate in writing, in which shall be stated
(a) that the persons signing have agreed to form a mutual fire insurance company under this Act;
(b) that each person signing will become a member of the company by insuring with the company rural subjects, in which the person has an insurable interest, to the amount the person sets opposite the person's name, according to the mutual-insurance plan, and subject to the rates, tariff, and entrance fees to be determined by the provisional directors of the company. The amount of such insurance which the provisional directors can accept shall not be less than sixty thousand dollars of risks;
(c) the amount of guarantee stock (if any) to be issued by the company and the number of shares of which this stock shall consist;
(d) the name of the company, which shall be subject to approval by the Registrar and the BC Financial Services Authority and which shall contain all of the following words:
(ii) either "insurance" or "assurance";
(iii) either "company" or "corporation";
(e) the name of the city, town, or electoral district in which the registered office of the company is to be located;
(f) the number and names of the provisional directors of the company (who shall be not fewer than seven nor more than fifteen), who shall manage all the affairs of the company until the first general meeting of the company; and
(g) that the members are not individually liable for the debts of the company beyond the amounts due under the premium notes given by each to the company, and that the shareholders (if any) are not individually liable for such debts beyond the amounts unpaid on the share or shares of guarantee stock each may hold.
RS1960-262-3; 2016-5-39; 2023-10-711; 2024-10-40.
4 The Registrar, on receiving such certificate in duplicate, shall fix the date and place of the first general meeting of the company, and cause a notice of incorporation to be published in the next and three following issues of the Gazette, in or as near as may be to the form following, namely:—
| The Mutual Fire Insurance Companies Act | |
| Certificate filed for incorporation of the Mutual Fire Insurance Company of this date. | |
| Registered office in , Province of British Columbia. | |
| The guarantee stock to be issued is $ , in shares of $ each [or no guarantee stock is meantime to be issued]. | |
| The following are the provisional directors of the Company, namely: [insert names and addresses]. | |
| The liability of the members (and shareholders, if any) is limited. | |
| The first general meeting of the Company will be held in on , the day of , 20 , at the hour of o'clock in . | |
| ________________________ Registrar of Companies. | |
| Victoria, B.C., 20 . | |
RS1960-262-4; 2016-21-18.
5 A copy of the certificate, filed in pursuance of this Act, certified by the Registrar, or a copy of the Gazette containing the Registrar's notice of the certificate, shall be received in all Courts and places as prima facie evidence of the facts therein stated.
RS1960-262-5.
6 Upon filing the certificate, the subscribers thereto, and all other persons thereafter becoming members or shareholders, shall be a body corporate by and under the name adopted, and have a common seal.
RS1960-262-6.
6.1 If a mutual fire insurance company seeks to adopt a new name,
(a) the new name shall be subject to approval by the Registrar and the BC Financial Services Authority, and
(b) the new name shall contain all of the following words:
(ii) either "insurance" or "assurance";
(iii) either "company" or "corporation".
2024-10-41.
7 (1) The corporate powers of the company may be exercised by the provisional board of directors prior to the date of the first meeting of the company, and thereafter by the successive boards of directors appointed by the members, or members and shareholders, of the company.
(2) The directors may delegate any of their powers to committees consisting of such member or members of their body as they think fit, and any committee so formed shall in the exercise of powers so delegated conform to any regulations that may be imposed on them by the directors.
RS1960-262-7.
Corporate Powers
8 A mutual company so incorporated has the following powers:—
(a) It may sue or be sued in any Court under the corporate name:
(b) It may purchase, lease, hold, sell, convey, or mortgage any real or personal property required for the business of the company:
(c) It may appoint such officers or agents as the business of the company requires, and define their powers and duties, and fix their remuneration and the amount of the security to be required of them; and
(d) It may make by-laws not inconsistent with this Act for the management of its business, the issue, denomination, and transfer of its shares, the regulation of the tariff of rates, the levying of assessments, and the terms and conditions of its insurance policies; and
(e) If authorized by resolution adopted after due notice at a general meeting of the company, it may incorporate, or purchase and hold or dispose of shares in, a corporation as defined in the Business Corporations Act.
RS1960-262-8; 1968-53-13; 2016-21-19.
9 Any mutual company may, under the authority of the certificate of incorporation, or by resolution adopted after due notice at a general meeting of the company, issue a guarantee stock in shares of such denomination as it may direct, and subject to such terms of payment and possessing such rights and privileges as may be prescribed by the company.
RS1960-262-9; 1989-47-387.
10 The board of directors shall not loan money to or borrow money from any director of the company, or enter into any contract with any director other than the issue of a policy of insurance in the ordinary course of business.
RS1960-262-10.
11 The board of directors may issue debentures, mortgages, or promissory notes in favour of any person for money borrowed, and it may borrow money for the purposes of the company for any term not exceeding one year and on such conditions as to interest and mode of repayment as it may think proper; and it may renew such debentures, mortgages, or promissory notes from time to time if necessary within the said term of one year; but the total amount so borrowed shall at no time exceed one-fourth of the total amount remaining due on the premium notes held by the company.
RS1960-262-11.
13 The directors of a mutual company may make arrangements with another mutual or stock company carrying on business in Canada for reinsurance of risks undertaken by the company on such terms and conditions as to premiums and rates of losses as may be arranged.
RS1960-262-13.
14 All contracts of insurance sealed with the seal of the company, signed by the president or vice-president and counter-signed by the secretary, shall be binding on the company.
RS1960-262-14.
16 Any contract may be renewed at the discretion of the board of directors by renewal receipts instead of a new policy, on the insured paying the required cash proportion of the insured's premium note, but such renewal shall be effected before the actual lapse of the period of the principal contract.
RS1960-262-16; 2023-10-712.
17 The rate to be charged or taken by way of premium note shall not be less than one dollar per hundred dollars per annum till such time as the gross amount at risk is two million dollars, when the rate may be reduced, but only by such an amount as will leave the total available assets of the company at not less at any time than two per centum of the gross amount at risk.
RS1960-262-17.
18 Every member shall, before the member receives the member's policy, deposit with the company a premium note payable on demand, or payable partly by fixed payment and partly on demand, to the company for the sum of money to be determined by a tariff or classification of risks established by the directors. The directors may require that the premium note be endorsed by a guarantor, to their satisfaction, before it is accepted. The member shall also pay as an entrance fee such proportion of the member's premium note in cash as may be determined by the directors, but such entrance fee shall not exceed fifteen per centum of the whole.
RS1960-262-18; 2023-10-713.
19 In the event of fixed payments being stated on the premium notes, it is not necessary for the company to give the guarantor notice of the time when these fixed payments become due, and failure to pay the same within thirty days after they become due may, in the option of the directors, nullify the policy.
RS1960-262-19.
20 (1) In the event of the directors levying an assessment on the premium notes, either where there are no fixed payments, or where such levy is necessary over and above the amount of the fixed payments, the assessment shall become due and payable in thirty days after notice thereof has been mailed to the last-known postal address of
(b) the person or persons who have given the premium note.
(2) Failure to pay the assessment referred to in subsection (1) within thirty days after the same became due may, in the option of the directors, nullify the policy of insurance.
2023-10-714.
21 A declaration in the terms of the last two preceding sections that the policy of insurance is nullified shall in no way relieve the member or other guarantor or guarantors of the premium note of the member's, guarantor's or guarantors' liabilities for the sums then due as fixed payments or assessments, nor for any share of any further losses or expenses the company may incur during the term of the contract unless the directors in their discretion decide otherwise, and the directors may recover the sums due, or to become due, and expenses by suit in the Provincial Court of the district where the registered office of the company is situate.
RS1960-262-21; 1975-57-44; 2023-10-715.
22 Where action is brought to recover payment of an assessment levied by the directors on a premium note, the certificate or oath of the secretary of the company specifying the assessment and the amount due by the member or guarantor or guarantors of the note by means of the assessment shall be taken and received as prima facie evidence thereof in any Court in the Province.
RS1960-262-22.
23 If there is a loss on property insured by the company, the directors may retain from the money payable to the insured therefor the amount of the premium note given for insurance thereon until the time has expired for which insurance has been made, and at the expiration of the said time the insured has the right to demand and receive such part of the retained sum as has not been assessed for or become due under fixed payments.
RS1960-262-23.
24 Forty days after the expiration of the term of insurance the premium note given for the insurance policy shall, on application therefor, be given up to the guarantor thereof, provided all assessments levied and all losses and expenses with which the note is chargeable have been paid.
RS1960-262-24.
25 Notwithstanding anything in this Act, a company may make contracts of mutual insurance in consideration of a fixed premium in addition to a premium note, and the fixed premium may be of such amount and payable at such time or times as the directors may determine. Sections 16 and 18 to 24 apply with respect to a payment of fixed premium as if those sections referred to a fixed premium in addition to a premium note.
RS1960-262-25.
28 Notwithstanding anything in this Act, where a company has successfully carried on business for not less than five years, and by a resolution adopted after due notice at a general meeting authorizes the directors to make contracts of insurance upon the cash plan, that is, for a money consideration without a premium note, the directors may make such contracts.
RS1960-262-28; 1998-11-14.
29 Policyholders under the cash plan shall not as such be members of the company or have any liability for its debts or obligations.
RS1960-262-29.
30 In the event of judgment being obtained against a mutual company, the issue of execution shall be stayed for sixty days from the date of judgment.
RS1960-262-30.
Shares
31 The shares of the guarantee stock of a mutual company (if any) are personal property, and may be transferred in the same manner as shares in a joint-stock company under the Companies Act, but until such shares are fully paid up no transfer thereof is valid without the consent of the directors of the company.
RS1960-262-31.
32 In the event of no by-law being passed to provide for the payment of the amounts due for shares of guarantee stock, the directors may from time to time make calls thereon either on the instructions of a general meeting of the company or as the exigencies of the company may render necessary.
RS1960-262-32.
33 The guarantee fund, whether paid up or unpaid, belongs to the company, and is liable for all its debts and losses, and the shareholders shall, in respect thereof, have such rights and responsibilities as the company in general meeting may declare by resolution or by by-law passed before the fund is subscribed for, and unless the whole of the fund is repaid or discharged the said resolution or by-law shall not be rescinded or altered in any way without the consent of three-fourths of the shareholders in writing.
RS1960-262-33.
34 If default is made by a shareholder in payment of any call upon the shareholder's shares for a period of two months after the call is due, the director may, on giving one month's notice to the shareholder by registered letter mailed to the shareholder's last-known postal address, declare the shares of such defaulter, and all sums previously paid thereon, to be forfeited to the company, and they may thereafter, unless within the said one month the amount due on the call is paid to the company, either cancel the shares, or sell and reissue them at such price or prices as they may deem sufficient and for the benefit of the company only; or in the option of the directors they may sue for and compel payment of the unpaid calls on the shares.
RS1960-262-34; 2023-10-716.
Audit
35 Every mutual company shall keep full and distinct records of all its business and transactions, including a register of all policies issued and premium notes and cash payments received in respect thereof; a register of all shares of guarantee stock (if any) issued, and of the amounts paid in respect thereof; books of accounts showing all cash transactions; minute-books and letter-books, and such other records as are usual and necessary to give a full and clear idea of the operations of the company; and these records shall at all times be accessible to any director or auditor of the company, or to anyone having authority from a general meeting on its behalf to examine and report upon the same.
RS1960-262-35.
36 Any fifteen members, or members and shareholders, may at any time petition the Supreme Court to appoint an auditor to audit and report on the books of the company, provided the petitioners deposit the sum of two hundred dollars with the Minister of Finance as a guarantee of good faith, which sum shall be held to the order of the auditor. Thereupon the Supreme Court may appoint an auditor accordingly, who shall have free access to and carefully examine all the books of the company and make a report to the Supreme Court, to the board of directors, and to the petitioners; and the Supreme Court shall also make such award as to the expenses of the audit as the Supreme Court deems right in the circumstances, and the petitioners, directors, officers, and company are all bound by such award and findings.
RS1960-262-36; 1993-38-27; B.C. Reg. 18/2010.
37 At the annual general meeting or at a general meeting of which due notice has been given one or more auditors of the company may be appointed, who shall make periodical examination of the books of the company and report to the directors thereon, and who shall receive such remuneration as may be fixed by that or any other general meeting or by the directors of the company.
RS1960-262-37.
Returns
38 Within one month after the annual general meeting in each year the secretary of the company shall file with the Registrar a return, signed by the president and the secretary, setting forth
(a) the amount of guarantee stock (if any) issued; the names of the shareholders, the number of shares held by each, and the amount paid up and due thereon;
(b) a copy of the annual statement of revenues and expenditure, and balance-sheet, duly certified by the auditor of the company;
(c) a full copy of all by-laws adopted by the directors or by a general meeting during the preceding year;
(d) the names of the president, vice-president, secretary, treasurer, directors, and auditors of the company appointed for the current year.
RS1960-262-38.
Management
39 (1) Every company shall have a registered office in the Province to which all communications and notices may be addressed, and may from time to time change the location thereof.
(2) Notice of the situation of the registered office of a company and of any change therein shall be filed with the Registrar.
RS1960-262-39.
40 Within one month after incorporation of the company the provisional directors shall meet and appoint a president and vice-president from their own number. They shall also appoint a secretary and a treasurer, and such other officers as may be required, to hold office till after the first general meeting of the company. They shall also determine the situation of the registered office of the Company. They shall also, within such period, prepare a tariff of rates for premium notes, and for entrance fees and fixed annual payments, to be paid or undertaken by members in exchange for the insurance policies of the company, and they shall adopt such other measures as will conduce to the establishment and furtherance of the company's business. They shall also prepare such by-laws as they deem necessary to regulate the business of the company, or for any other purpose, to be submitted to the first general meeting of the company.
RS1960-262-40.
41 (1) The company, through its board of directors, may admit as a member thereof the owner of any rural property, real or personal, by the issuance to the owner of a policy of mutual insurance, insuring the owner against loss by fire in respect thereof, and every person so admitted shall be entitled to like rights and be subjected to like liabilities as other members of the company.
(2) Any member of a mutual company may, with consent of the directors, at any time withdraw therefrom upon such terms as the directors may require in respect of the obligations of the company.
(3) Where the company or a member terminates a contract of mutual insurance, or a contract of mutual insurance expires and is not renewed, the member insured thereby ipso facto ceases to be a member on the date of the termination or expiration, as the case may be, save that a person who was previously a member shall continue to be liable, as if the person were a member, for any sum due in respect of that person's premium note and any other sum by way of premium due to the company and for losses insured against by the company and occurring before that date.
RS1960-262-41; 2023-10-717.
42 No member of a mutual company is liable in respect of any loss or other claim or demand against the company, otherwise than upon and to the extent of the amount unpaid upon the member's premium note or other undertaking.
RS1960-262-42; 2023-10-718.
43 Each subscriber for shares of guarantee stock of a mutual company, who is not otherwise a member of the company, has as a shareholder, all the powers and privileges of a member of the company, and the subscriber is entitled to take part in and vote at all meetings of the company in person or by proxy in favour of another member or shareholder of the company.
RS1960-262-43; 2023-10-719.
44 At the first general meeting of the company the members shall appoint as a board of directors not fewer than seven, nor more than fifteen, duly qualified members or shareholders of the company, and they shall also pass such by-laws as are necessary in the interests of the company, and they may appoint auditors or other officers of the company.
RS1960-262-44.
45 At all general meetings all members and shareholders in good standing shall have one vote each, but they may vote in person or by proxy in favour of another member or shareholder. The chair at all meetings shall have a casting-vote only in case of an equality of votes on a division. The election of directors and all other officers shall be by ballot.
RS1960-262-45; 2023-10-720.
46 The directors of the company shall hold office for a period of three years, but of the directors elected at the first general meeting, one-third, as may be determined by lot, shall retire at the end of one year, and another third similarly determined shall retire at the end of two years. The rotation shall be arranged at the first meeting of the directors after their election.
RS1960-262-46.
47 No person is eligible for the office of director, except as hereinafter provided, who is not a holder in the person's own right of a subsisting policy of the company for at least one thousand dollars, or of shares in the company's guarantee stock to the amount of two hundred dollars, par value.
RS1960-262-47; 2023-10-721.
48 (1) The manager of a mutual company may also be elected a director, though the manager may not be a member, and the manager may be paid an annual salary or the manager may be remunerated for the manager's services in such other form as the other directors may determine.
(2) The directors may delegate to a manager the powers conferred on them by this Act, except any power conferred by clause (d) of section 8 or by sections 11, 13, and 20.
RS1960-262-48; 2023-10-722.
49 (1) No applicant for mutual insurance shall be deemed a member of the company, or is entitled to be elected as a director of the company, or is entitled to take part in any of the company's meetings, until the applicant's policy of insurance has been issued to the applicant by the board of directors.
(2) Where the directors have conferred power upon the manager to issue policies of insurance, the manager may make a contract of insurance for a period not exceeding fourteen days with any applicant for mutual insurance, and a person so insured is liable in respect of losses insured against by the company and occurring during the period of the person's contract as if the person had been admitted as a member.
RS1960-262-49; 2023-10-723.
50 No paid officer or person in the employment of the company, other than the manager, is eligible to be elected a director, or to take part in the election of the directors, though a paid officer or person in the employment of the company may be a member of the company.
RS1960-262-50; 2023-10-724.
51 Fifteen members actually present form a quorum at all general meetings of the company, and five directors are a quorum at all board meetings.
RS1960-262-51.
52 A resolution in writing, signed by all the directors, is as valid and effectual as if it had been passed at a meeting of the directors duly called and constituted.
RS1960-262-52.
53 A meeting of the members or members and shareholders of a mutual company shall be held in January or February in each year, at such time and place as may be prescribed by the directors or by the by-laws of the company. At such meeting, in addition to the election of directors, there shall be submitted and considered a report of the transactions of the company for the preceding year, together with a full statement of its affairs, exhibiting in detail its receipts and expenditures, and its assets and liabilities, and a report by the auditors of the company thereon.
RS1960-262-53.
54 Notice of an annual or special general meeting of the company shall be published in one or more daily or weekly newspapers published or circulating in the district embraced in the operations of the company, and by circular letter mailed by the secretary to the last-known postal address of each member and each shareholder at least fourteen days previous to the date of the meeting.
RS1960-262-54.
55 The president, or the board of directors, or any fifteen members or shareholders of the company may at any time direct the secretary of the company to call a general meeting of the company to be held at such time and place and for such purposes as those calling the meeting may determine, but priority shall always be given to a meeting convened by the board of directors.
RS1960-262-55.
56 In the event of a quorum not being present at the annual general meeting of the company, the retiring directors shall hold office until their successors are appointed, and the board shall convene another general meeting, to be held within two months of the date of the annual general meeting, to transact the business of the annual general meeting.
RS1960-262-56.
57 In the event of a vacancy arising on the board of directors through the death, insolvency, disqualification, or resignation of any of the directors, or through the absence from three consecutive meetings of the board of any member, without leave of the board, which shall ipso facto void the member's rights, the vacancy so arising shall be filled by the directors, whose appointee shall hold office until the next annual general meeting of the company.
RS1960-262-57; 2023-10-725.
58 At any annual general meeting of the company there may be voted to the directors, or any of them, for the preceding year, such sum or sums of money as may be deemed reasonable remuneration for their services.
RS1960-262-58.
59 The directors may be paid a reasonable allowance for travelling expenses to attend meetings of the board, or to attend to the business of the company.
RS1960-262-59.
60 The following persons, having charge of the funds of the company, shall give security to the satisfaction of the board of directors in an amount to be fixed by a general meeting, or by the directors, but not to be less than $2 000, for the faithful discharge of the persons' duties:
(a) the treasurer of a mutual company;
(b) the manager of a mutual company;
(c) the secretary of a mutual company.
2023-10-726.
Forfeiture of Charter
61 The corporate powers of the company shall be forfeited and cease, except for the purpose of winding-up, if
(a) there are not, before the lapse of one year and six months from the date of filing the certificate for incorporation, mutual-insurance policies of the company in force to a total amount of three hundred thousand dollars; or
(b) at any time thereafter the total amount of such insurance policies has diminished and become less than three hundred thousand dollars; or
(c) at any time the company becomes insolvent, and unable from any cause to meet its obligations within three months after liquidation thereof, by judgment of the Court or of a referee.
RS1960-262-61.
62 Non-compliance with the statutory provisions as to meetings, election of officers, or conduct of the ordinary business of the company shall not, per se, involve forfeiture of the corporate powers or privileges of the company, and such non-compliance may at any time be confirmed and approved of by a resolution to that effect passed at the annual or any other duly convened general meeting of members of the company; but the company may impose penalties or claim damages for any loss that may result to the company in respect of such omissions or neglect of officials on or from the defaulting officials themselves.
RS1960-262-62.
Winding-up
63 If the corporate powers of the company are forfeited in terms of section 61, or if the members adopt a resolution at a general meeting, of which due notice has been given, to wind up, the company may in general meeting appoint a receiver or receivers to conduct the winding-up proceedings, and such receiver or receivers thereupon have the full power and authority of directors in the matter.
RS1960-262-63.
64 The receiver may use the guarantee funds if necessary to effect an equitable reinsurance of all risks held by the company, whether held under the premium-note plan or a short-term policy on the cash plan.
RS1960-262-64; 2006-12-70.
65 After winding up the affairs of the company, the receiver shall file the receiver's accounts with the Registrar containing a full statement of the receiver's transactions, together with copy of minutes of a general meeting approving of the receiver's report and management.
RS1960-262-65; 2023-10-727.
66 There shall be paid to the Registrar in respect of the several matters mentioned in the Schedule the several fees therein specified, and the Registrar shall pay all fees so received by the Registrar into the Provincial Treasury.
RS1960-262-66; 2023-10-728.
| For filing certificate under section 3 ................................................... | $10.00 |
| For filing return .............................................................................. | 1.00 |
| For filing any other document ........................................................... | 1.00 |
| For every search ............................................................................ | .25 |
| Publication in the Gazette, according to the scale of charges in force under the Public Printing Act. |
RS1960-262-Sch.
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