Insurable Interest Canadian Insurance Blog

The National Association of Insurance Commissioners creates model laws for states to pass. Consumer advocate Birny Birnbaum pushed a state insurance regulator committee to overhaul illustration rules Tuesday. The Life Insurance and Annuities Committee gave Birnbaum 20 minutes to make the case for new illustration rules. The committee, part of the National Association of Insurance Commissioners, considers model laws to govern insurance, which are then available to states for adoption. The overall life insurance illustration model regulation 582 was an acrimonious process that took years before the NAIC adopted it in 1995. In the years since, insurers have come up with various product features that have rendered illustration guidelines nearly useless, Birnbaum claimed. “Illustrations obscure instead of explaining the operation of the policy,” he said on a conference call. “Illustrations in advertisements presenting misleading information about the risk and return.” And the fault lies not necessarily with the insurer or the agent, said Birnbaum, who began by stating the life insurance and annuities “can and should play a major role in consumer financial and retirement security.” Advertisement However, “it’s a regulatory framework that encourages these poor consumer outcomes,” he added. Much of the controversy centers on proprietary indexes developed by...

Blake Wolfe | November 11, 2020 The union representing General Motors of Canada Co. employees in Ontario have ratified a new three-year collective agreement that removes changes to a legacy defined benefit plan as part of ongoing pension discussions. The deal restores the legacy DB plan by removing a member contribution requirement and a 30-year cap on credited service introduced in 2009, says Corey Vermey, director of the pensions and benefits department at Unifor. The DB change takes place ahead of additional pension discussions for employees in the organization’s hybrid plan (hired between 2012 and 2016) and defined contribution plan (those hired within the last four years), he adds. Read: DC pension deal with GM to ‘certainly influence’ talks with Ford, Chrysler: lawyer In this round of negotiations, the union stipulated that there will be a more serious conversation about moving to the Colleges of Applied Arts and Technology pension plan’s DBplus in the future, says Vermey, noting the union sees this as a solution for all employees hired after 2016. “In 2023, there needs to be a conversation about the hybrid members and whether it makes sense for them to move to the legacy DB or to CAAT.” Unifor also clarified that employees hired since 2016,...

Staff | November 11, 2020 The solvency ratio of Ontario’s defined benefit pension plans jumped four per cent in the third quarter of 2020, according to an update by the Financial Services Regulatory Authority of Ontario. The increase is further evidence that market recovery is well underway since the coronavirus pandemic rocked the world economy in early 2020, noted the report. Indeed, the median projected solvency ratio steadily increased to 94 per cent by Sept. 30, 2020, up from 90 per cent in June and 85 per cent in March. Read: FSRA estimating jump in DB pension solvency off rebound in markets The FSRA’s projections showed the latest growth is due to positive investment returns, which averaged just above two per cent. Another factor was an increase in solvency discount rates, with 10 basis points in the non-indexed commuted-value rates and 28 basis points in non-indexed annuity purchase rates. The regulator also projected that 34 per cent of the province’s DB plans are fully funded on a solvency basis. However, it noted 26 per cent still have a lower solvency ratio below 85 per cent. Despite most plans having opened the year in a stronger position, gains from the last two quarters still fall below the December...

It’s been said that change is the only constant, and by extension, one might say the same for technology given its role in disrupting industries. In the insurance and wealth management space, Equisoft has long established itself as a leader in enabling that type of change – and its story is still far from over. “We founded Equisoft over twenty-five years ago, Luis Romero being our CEO,” said Florence Sabbah, Vice President, Canada at Equisoft. “Since we launched our first product, we’ve grown to service the whole insurance industry with end-to-end solutions, servicing all players including advisors, distributors, and all the way through to large carriers. We have quite a range of products, but we’re still continuing to increase the breadth of business functionalities that we support.” While Equisoft has an international footprint for its products and services, Sabbah said it also counts many large carriers among its client base here at home, including one of the top three Canadian insurers. Across the national wealth and insurance space, they have business with BMO, Bank of Nova Scotia, and Richardson Wealth. Recently, Equisoft also announced an expansion of a partnership with AgenZ, the third-largest MGA in Quebec with over 1,500 advisors....

Goose Insurance, an app-based provider of life insurance, has teamed up with one of Canada’s largest insurers to offer accessible and affordable coverage for Canadian smartphone users under 69 years old. “Goose is tackling the accessibility and affordability of insurance, and addressing the underserved market,” said Goose Insurance President Dejan Mirkovic. Accessibility and affordability were the top barriers to buying life insurance cited in a recent survey of over 1,000 Canadians conducted by the company. Among young Canadians aged 25 to 35, more than 50% said they didn’t know where to buy it from, and more than 70% said it was too complicated. Goose found fewer than 5% had critical illness insurance or cancer insurance. The majority of respondents also held the mistaken belief that Canada’s healthcare system covers all costs associated with cancer treatment or any other life-threatening illness. Female respondents were grossly underinsured, with more than 70% saying they’ve never purchased life or critical illness insurance. Citing statistics from the Canadian Medical Association Journal, Goose said nearly half of Canadians will face a cancer diagnosis within their lifetime; in 2020 along, CMAJ estimates place the number of cancer diagnoses at 225,000, with a cancer death toll of 83,000....

Staff  | November 10, 2020 Sun Life Financial is introducing a digital program to advance workplace diversity, inclusion and equity among its global workforce. The peer learning program, by Hive Learning Ltd., is designed to help employees own, accelerate and embed change, increasing the pace at which inclusion becomes a habit, according to a press release. Read: How to use benefits to support diversity and inclusion “At Sun Life, we are all committed to do our part to end systemic racism, intolerance and inequities,” said Helena Pagano, executive vice-president, chief human resources and communications officer at Sun Life, in the release. “Integrating learning and development is critical to achieving our goal.” Over the past 18 months, the insurer piloted the program with 1,500 employees in North America and Asia. At the end of the pilot, it found 96 per cent said they believe the program will drive positive change at Sun Life; 94 per cent said they feel confident demonstrating inclusive behaviours at work; 92 per cent said they found the overall learning experience engaging and valuable; and 88 per cent said they’re committed to taking action on what they learned. Read the full article at BenefitsCanada.com

Staff | November 10, 2020 The Canada Pension Plan Investment Board and TPG Capital are increasing their investment in Viking Holdings Ltd. The CPPIB and the private equity platform were already minority stakeholders in the parent company of Viking Cruises. The additional investment means about US$500 million of net proceeds will be available to support Viking Cruises continued development.  Read: CPPIB invests in cruise operator “While the pandemic has posed many challenges, we have strong conviction that Viking’s unique global offering in the cruise industry will continue to be sought out by many guests well into the future,” said Bill MacKenzie, managing director and head of active fundamental equities for the CPPIB, in a press release. “CPP Investments, alongside TPG, is looking forward to supporting Viking and its management team as they return to delivering high-quality, comfortable journeys around the world and build long-term value in the business in the time to come.” Read the full article at BenefitsCanada.com

Staff | November 10, 2020 Soon after the beginning of the coronavirus pandemic, layoffs and the shift to remote working resulted in a 30-year low in female participation in the Canadian workforce, threatening to undo gains in gender equity in the workplace, according to a new report by the Canada Pension Plan Investment Board. Women have suffered the most layoffs or furloughs during the pandemic and are returning to work at a slower pace, it noted. There are also signs of women leaving the workforce at higher rates than men, which may lead to far fewer women in leadership roles in the coming years. Read: Women considering downshifting, leaving careers due to pandemic: report “The business risk of losing the expertise and perspectives brought to the table by women is too great to ignore,” said Mark Machin, president and chief executive officer of the CPPIB, in a press release. The fallout from the crisis could dismantle the pipeline of next-generation female leaders and reverse corporate Canada’s progress toward diversity and inclusion, warned the CPPIB, noting the effects could also have a lasting economic impact on the country. For instance, the report said that companies in the top quartile for management gender diversity were 25 per cent more likely to deliver higher profitability than those in...

Older Canadians are most optimistic about the power of A.I., as IBM Canada national survey reflects a generational divide on the role of technology in protecting the planet Markham, ON (Nov. 9, 2020) – According to the findings from a national IBM Canada survey on technology and the environment, different generations of Canadians have varying views on our progress in the fight against climate change, our personal contributions to the cause, and the potential for technologies like Artificial Intelligence and Quantum Computing to help protect the planet. The study also reveals differences in perception as to the impact COVID-19 is having on the country’s environmental sustainability. Even though Canadians over the age of 50 are more likely to believe COVID-19 has stalled progress in the fight against climate change, they aren’t expressing any greater concern for the environment than a year ago. Conversely, two-thirds of young adults (under 30) seem increasingly pessimistic, indicating they are more worried about the environment now than before the pandemic. The statistics mark a 22% difference in the level of concern between the generations. Some of that increased concern by younger Canadians may come from self-awareness over their COVID-19 habits. According to the IBM survey,...

Staff | November 9, 2020 Morneau Shepell Ltd. is expanding its internet-based cognitive behavioural therapy solution with a series of new programs, in response to a growing need for these services during the coronavirus pandemic. Programs covering trauma, grief and loss will be available on the AbilitiCBT platform by the end of 2020, while those focused on obsessive-compulsive disorder and anxiety issues such as panic disorder and social anxiety to launch in early 2021. The programs will be available in both English and French. Read: Morneau Shepell expanding into telemedicine services “Our extensive clinical data and comprehensive mental-health research continues to indicate a strong and growing need for additional therapist-assisted digital mental-health programs during these challenging times,” said Nigel Branker, president of health and productivity solutions at Morneau Shepell, in a press release. “We are committed to expanding our support and working with our partners to help as many Canadians as we can.” Read the full article at BenefitsCanada.com