The excerpted article was written by ALEX MACPHERSON, SASKATOON StarPhoenix

Saskatchewan’s highest court will decide whether investors can put unlimited funds into insurance policies with a guaranteed rate of return.

Saskatchewan’s highest court is set to spend the next three days hearing a case that could have lasting implications for Canada’s insurance industry, hundreds of policyholders and the provincial government.

The case, which will be heard at the Saskatchewan Court of Appeal in Regina Wednesday, will test whether investors can put any amount of money into certain life insurance policies with a guaranteed rate of return, as well as the effects of the province’s decision to intervene in a live court case.

The plaintiffs — investors who own the 20-plus-year-old policies — want the Court of Appeal for Saskatchewan to overturn a lower court’s ruling that says they cannot use the policies for “unlimited stand-alone investment opportunities.”

While the investors have argued the policies do not have a cap on premiums and can be used for exactly that, three of the country’s largest insurers contend the polices were never intended to be used that way and, if they are, it could bankrupt them.

The insurance companies, meanwhile, are asking the court to reverse the same justice’s finding that new provincial regulations, introduced during the original trial to close the loophole used by the investors, cannot be applied retroactively.

The provincial government’s decision to make the changes by way of a three-page order that mentions neither the trial nor the Manufacturers Life Insurance Co.’s (Manulife) lobbying efforts has been criticized as not transparent and potentially unfair.

Saskatchewan Attorney General Don Morgan later acknowledged the province could have been more transparent, but emphasized the decision to protect the companies and, by extension, the people they insure was the correct one.

The case is set to be heard by a three-judge panel consisting of justices Brian Barrington-Foote, Neal Caldwell and Jerome Tholl.

The appeal is scheduled to begin three weeks after the court refused the Canadian Life and Health Insurance Association’s (CLHIA) application for intervener status — which, if granted, would have allowed it to make arguments.

The insurance companies involved in the case — Manulife, BMO Life Assurance Co. and Industrial Alliance Insurance and Financial Services Inc., who are collectively known as the respondents — are all CLHIA members.

In a Dec. 23 chambers decision, the same three-judge panel acknowledged the association has a “clear interest” in the proceedings, but declined to grant it intervener status in a private matter involving experienced litigants.

“We are not persuaded by the materials or argument in this application that CLHIA would add anything meaningful to the respondents’ arguments, as opposed to simply adding to the chorus,” the justices wrote in the decision.

CLHIA spokesman Kevin Dorse declined to comment on the grounds the case is before the courts.

Given how much is at stake in the case, it is expected the Saskatchewan Court of Appeal’s decision in the matter will result in a request for leave to appeal to the Supreme Court of Canada — the country’s highest judicial authority.

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