Federally registered Pooled Registered Pension Plans (PRPPs) can now launch, as five insurers have been registered as PRPP providers.
The federal Department of Finance said Tuesday that the five life insurance companies that have federal PRPP licences — Sun Life, Great West Life, Manulife, Standard Life and Industrial-Alliance — have been registered with both the Office of the Superintendent of Financial Institutions (OSFI) and the Canada Revenue Agency (CRA), which is the final pre-requisite to launching federal PRPPs.
“Today concludes the final administrative step in making federal PRPPs available to Canadians,” said Kevin Sorenson, Minister of State (Finance). “This is a major milestone in providing an attractive new retirement savings option for those millions of Canadians — roughly 60% — who do not have access to a workplace pension plan.” Sorenson also called on the provinces that haven’t implemented PRPP frameworks to do so “expeditiously”.
The new voluntary pension arrangements are intended to make it easier for small businesses, and even the self-employed, to participate in workplace pensions; complementing existing registered pension plans and individual savings vehicles, such as RRSPs and TFSAs.
“The PRPP is a very beneficial solution for eligible Canadians who did not have access to a group pension plan. We want to offer them tools to help them prepare better for retirement. It made perfect sense to enhance our offer by adding this new plan,” said Renée Laflamme, vice president, group savings and retirement, Industrial Alliance Insurance and Financial Services Inc.
“Now that the federal PRPP and Quebec’s voluntary retirement savings plan are in place, we hope other Finance Ministers will soon adopt the PRPP framework that was agreed to a few years ago,” added Charles Guay, president and CEO, Standard Life Canada.
“The Canadian life and health insurance industry welcomes today’s announcement that five insurance companies have been licensed to provide PRPPs and believes it demonstrates the willingness of our industry to provide Canadians with an excellent vehicle to save for retirement. Because of our existing platforms in serving other pension plans, we can hit the ground running to provide top-quality, low-cost PRPP services to Canadians, particularly small and medium-sized businesses,” said Frank Swedlove, president of the Canadian Life and Health Insurance Association (CLHIA).