LAWYER'S SECTION

ASSIGNMENT OF LIABILITY

Under CCRA (Revenue Canada) rules, a Canadian casualty company must own the structure as well as maintain a contingent liability for all payments to be made under the structure.

In some cases, the casualty insurer does not wish to own the annuity contract (e.g., a small company; a foreign company; or for tax reasons). The casualty insurer may assign its rights and obligations under the structure to an assignee for a fee. The assignee becomes the owner and maintains the contingent liability.