Principal Issues:
1. Whether certain changes made to a life insurance policy after April 26, 1995 will affect the application of the grandfathering provisions to the stop-loss rules in subsection 112(3).
2. Whether a change in the ownership and the beneficiary of a life insurance policy after April 26, 1995 will affect the application of the grandfathering provisions.
3. Whether a rollover under section 85 has any impact on the application of the grandfathering provisions.
Position:
1. Not necessarily.
2. No, provided that the conditions set out in paragraph 131(1)(b) of S.C. 1998, c.19 relating to the life insurance policy are otherwise met.
3. No.
Reasons:
1. Where the conditions set out in paragraph 131(1)(b) of S.C. 1998, c. 19 relating to the life insurance policy existed on April 26, 1995, it is our view that any further modications or alterations or cancellation of the policy would not, in and of themselves, result in the loss of grandfathering.