As a federally regulated financial institution, Blue Cross Life Insurance Company of Canada (“Blue Cross Life”) is required to comply with the Office of the Superintendent of Financial Institutions (“OSFI”) Life Insurance Capital Adequacy Test (“LICAT”). At a minimum, Blue Cross Life therefore needs to maintain a Total LICAT Ratio of 90%, and a Core LICAT Ratio of 55%. In addition, OSFI has established a supervisory target Total LICAT Ratio of 100%, and a corresponding target Core LICAT Ratio of 70%. Definitions of terms used in this disclosure can be found in the LICAT guideline on OSFI’s website.
As at December 31, 2025, the Blue Cross Life Total LICAT ratio was 138%, well in excess of both the supervisory target Total LICAT Ratio and Blue Cross Life’s internal target. A breakdown of this solvency ratio by component, with comparatives to the previous year, is presented in the following table.
The increase in available capital was mainly driven by net income. The increase in surplus allowance and base solvency buffer was mainly driven by organic growth.
