At the request of the Superintendent of Financial Institutions, the Attorney General of Canada applied today for an order to wind up the Canadian branch of Reliance Insurance Co. under the Winding-up and Restructuring Act.

Mr. Justice Farley of the Ontario Superior Court granted the order and appointed KPMG Inc. as the provisional liquidator. The Superintendent took control of the firm’s Canadian branch on October 5.

In May of this year, Reliance’s U.S. operation was placed under an order of rehabilitation. Its efforts were unsuccessful and the company was put into liquidation and declared insolvent on October 3 by the Court of Pennsylvania. At the time, the Superintendent was of the opinion that the liquidation of the company in the U.S. would adversely affect the branch and so took the necessary action to protect the policyholders and creditors in Canada.

The Toronto branch employs 16 people and underwrites mainly commercial business, including property, general liability and professional liability. In early 2001, OSFI directed the branch to stop writing new business.