Ontario court approves $213.5M Sun Life settlement affecting 70,000 policyholders

ASM, Philippine Canadian Inquirer
October 29, 2026

Photo courtesy: CTV News

Approximately 70,000 current and former life insurance policyholders across Canada could benefit from a C$213.5-million class-action settlement approved by the Ontario Superior Court of Justice, bringing a legal dispute that began in 2010 closer to resolution.

The case involved allegations that certain universal life insurance policies were improperly administered. The policies, known as Universal Plus, Flexiplus, and OptiMet, were originally sold by Metropolitan Life Insurance Company (MetLife) agents in Canada between 1987 and 1998.

Sun Life later inherited the policies through historical business acquisitions and has denied any wrongdoing.

According to law firm Kim Spencer McPhee Barristers P.C., the settlement is the largest reported resolution of a life insurance policy dispute in Canadian history.

The agreement received court approval on September 8, 2026, and took effect on October 8.

Who could benefit from the settlement?

The settlement provides compensation and future insurance cost protections to certain current and former Flexiplus and Universal Plus policyholders.

Eligible Flexiplus policyholders may receive compensation related to past increases in insurance charges and administrative fees. Those who still hold qualifying policies may also benefit from a permanent freeze on certain charges.

For Universal Plus, compensation applies to certain current and former policyholders whose policies were issued before 1992 and who paid qualifying insurance charges exceeding specified policy limits.

Some current Universal Plus policyholders may also receive protection against future increases in those charges.

Although OptiMet was among the policies involved in the original lawsuit, its policyholders are not entitled to benefits under the approved settlement.

The exact amount of compensation will depend on each policyholder’s circumstances and the settlement terms.

Importantly, the C$213.5-million settlement value does not represent an equal cash payout to all 70,000 policyholders. It includes monetary compensation, the value of future policy benefits, and settlement-related expenses.

Sun Life denies wrongdoing

Sun Life previously announced that it had reached a settlement in principle in April 2026.

The company emphasized that the policies at the center of the dispute were originally sold by MetLife and inherited through earlier Canadian acquisitions.

It also clarified that the lawsuit does not involve insurance products originally sold by Sun Life.

Under an existing indemnity arrangement, Sun Life said it would seek recovery from MetLife for costs associated with the settlement.

The agreement resolves the legal claims without a court finding that Sun Life committed wrongdoing.

What should affected policyholders do?

Although the settlement has taken effect, it does not mean compensation has already been distributed or that all potential beneficiaries can immediately submit claims.

The official settlement website indicated that further information about eligibility, notification, and claims procedures was expected in November 2026.

Current and former policyholders who believe they may qualify should review their insurance records and monitor official announcements before taking action.

Updates, including instructions for eligible claimants, are available through the official settlement website at sunlifeclassaction.com.

The settlement follows more than 16 years of legal proceedings.

Eldon Fehr, one of the representative plaintiffs, welcomed the agreement, saying it would provide significant benefits to current and former policyholders.

For affected Canadians, the court’s approval marks a major step toward resolving the long-running dispute over insurance charges and providing greater certainty about eligible policy benefits.