Postponement of Automobile Replacement Insurance
It was previously announced that, as of August 1, 2010, automobile replacement insurance would be offered instead of the automobile replacement guarantee currently offered by car dealers. However, this measure has been postponed. Automobile replacement insurance will only be offered as of October 1, 2010. Consequently, replacement guarantees will no longer be offered as of that date.
The Autorité des marchés financiers has announced that the automobile replacement guarantee offered by car dealers at the time of the sale or long-term lease of a new or used automobile, is an automobile insurance product subject to its oversight.
Automobile replacement insurance will be offered exclusively through insurance agents, insurance brokers and authorized distributors (essentially car dealers) pursuant to the Act respecting the distribution of financial products and services.
Persons authorized to offer automobile replacement insurance must collect the 5% tax applicable to automobile replacement insurance premiums received from a policyholder and remit the tax to Revenu Québec. Persons (such as car dealers) subject to this obligation must register for the tax on insurance premiums.