It's valid for government to say no to the circle of self-interest and refuse to create enabling laws. It is preferred that no enabling rules be established, but if there are to be enabling rules, it is vital to get them right. These decisions should receive the highest level of scrutiny within the company with supermajority quorum and approval thresholds. In Ontario there is a 90% requirement on this question.
The surplus of the company should remain in the mutual insurance system. Questions on the demutualization should be addressed by government as opposed to deferring to the courts. Not passing disrespect to the courts—I have the utmost respect for them—but politicians with public input are best suited to set public policy, especially in novel areas of the law, as opposed to deferring to courts.
Finally, government should pass a law requiring that all policyholders of a mutual are considered a mutual or voting member of the company. That will solve the problem with 4% of the mutuals where they have gotten themselves into a distorted ownership picture with a narrow mutual ownership situation. There is one company of 800,000 policyholders that suggests that they have 1,000 mutual policyholders. They have $1.6 billion in surplus, and this company is the principal driver of these rules.
Thank you.