MONTREAL — Canadiens star Andrei Markov is not happy with his insurer.
The NHL defenceman has initiated legal action seeking reimbursement of the $1.2 million in premiums he’s paid since 2007 to Great-West Life for a universal life-insurance policy that was part of a sophisticated financial plan intended to ensure his future upon retirement.
Great-West Life filed a motion in February to dismiss his court action on the grounds that Quebec courts were not a suitable jurisdiction.
It claimed Markov has an Ontario driver’s licence, retains the professional services of a sports-management company based in Ontario, spends up to six months of his off-season time in Russia, and does not have authority to make final decisions on matters relating to the trust created for him.
But Quebec Superior Court Judge Thomas Davis has ruled that, under the Quebec civil code, an action based upon an insurance contract may be instituted before the court of the province where the insured is domiciled, and in Markov’s case, that’s Quebec.
“Markov resides in Quebec and was a resident of Quebec when he signed the policy. Despite the trust arrangement, it is Markov as an individual who the alleged misrepresentations affect the most,” Judge Davis noted.
According to capgeek.com, Markov’s annual salary with the Canadiens is $5,750,000.
In a Superior Court claim by William Johnston, trustee of Markov’s retirement compensation arrangement (RCA) trust, the insurance policy is said to have “had adverse effects on the trust and Markov, its beneficiary,” contrary to the original pitch of the Ontario-based insurance representative who proposed it, Eric Niskanen.
In a retirement compensation arrangement, an employer or former employer makes contributions to a custodian, who holds the funds in trust with the intent of distributing them to the beneficiary when he or she retires. “The contributions are immediately deductible to the employer and are not taxable to the employee until the funds are paid out,” the court ruling explains.
Johnston’s action says Markov’s salary from the Canadiens is invested in the trust, which is the sole owner and beneficiary of the life-insurance policy. Markov is the sole beneficiary of the trust.
“Markov has little knowledge of the financial instruments available in Canada for high-net-worth individuals. He relies on his agent and other advisers to manage his finances,” the Davis ruling states.
As trustee, Johnston has asked the court to annul the policy and order that $1.2 in premiums be refunded.
He said the insurance application provided by Niskanen included “financial projections based on the incorrect assumptions ... that Markov was a non-smoker and a resident of Ontario,” the ruling said.
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