We have many small and mid-sized life-insuring institutions in Canada, and this point has been considered. Obviously the risk of a large financial institution doing business in many countries is different from the risk of a small insurer doing business in one province or in one region of a province. Having said that, it will be of paramount importance that the regulation to come be principle-based as opposed to rule-based.
Let me give you an illustration of this from a small institution's perspective. If the legal requirement is for me to have a bathroom in my house, the size of that bathroom should not be imposed upon me. So if it's only my wife and I living in the house, I will have a smaller bathroom. If I have a lot of guests, a big family, uncles and cousins, I may need two or three bathrooms. It will be up to me, depending on my risk. It would be very costly if the regulation were to impose on me what colours I should have on the walls, what kinds of fixtures I should have, or the kind of garbage can I should place in my bathroom--plastic, ceramic, it doesn't matter as long as I have one.
That would be the right approach to take; in short, a risk-based approach combined with a principle-based regulation.