Insurable Interest Canadian Insurance Blog

Staff  | July 29, 2020 Canadian defined benefit pension plans experienced an upsurge in the second quarter of 2020, posting a median return of 9.6 per cent, according to RBC Investor and Treasury Services’ universe of DB pension plans. After the first quarter’s median return of negative 7.1 per cent, the rally marked the highest single quarter return in the universe’s history, according to a press release, which noted the gains followed a series of aggressive fiscal and monetary support measures introduced in March to address the impact of the virtual shutdown of the global economy due to the coronavirus. Read: Canadian DB plans return negative 7.1% in first quarter: reports After their March lows, global equity markets recovered most of their first quarter losses. The median pension plan generated 13.9 per cent in its non-Canadian equity holdings, compared to 14.2 per cent for the MSCI world index. In Canada, the TSX composite index returned 17 per cent, with 10 out of the 11 economic sectors generating positive returns. Information technology, led by Shopify Inc., took the top spot (up 68.3 per cent), followed by the materials, consumer discretionary and energy sectors. The median Canadian equities returned 13 per cent, trailing the benchmark by four per cent....

Staff  | July 29, 2020 People Corporation Inc. is appointing two Aon alums to its team, effective July 31. Kim Siddall is vice-president of enterprise consulting for the West and Kevin Bell is vice-president of enterprise business development for the West. Prior to the move, Siddall spent more than six years at Aon, most recently as vice-president and local practice leader. Other previous roles include principal at AQ Group Solutions, product development specialist at Manitoba Blue Cross, consultant at Strata Benefits Consulting Inc. and product manager at Canada Life Assurance Co. Read more People Watch news Siddall is also an expert panellist at Benefits Canada, chair of the board of directors at the Misericordia Health Centre Foundation and a past director for Manitoba of the Canadian Pension & Benefits Institute. Bell joined Aon in 2011 as a senior consultant in health and benefits. Since then, he’s held the roles of associate vice-president and vice-president. Previously, he was an account executive at Manitoba Blue Cross. Read the full article at BenefitsCanada.com

New SMA Blog by Mark Breading, Partner, Strategy Meets Action — I’ve never been a big fan of the term disruption. I believe that in the InsurTech world, a majority of the startups are partnering with incumbents to enable industry transformation. They are catalysts for change, to be sure. But few are truly turning the industry on its head. For instance, Lemonade is a startup that, since its inception, has positioned itself as a disruptor. The slogan is still “Forget Everything You Know About Insurance.” The constant marketing drumbeat from the company has emphasized its different approach and has especially focused on appealing to millennials. And with the recent spectacular IPO, Lemonade has the attention of the insurance world. I believe Lemonade has been very good for the industry (and it has certainly been good for the founders). But I think that Tesla has the potential to be even more of a disruptor in the long run. This might seem an odd assertion, given that Tesla has heretofore only dipped its toe in the insurance waters, and Lemonade is four years old and on a roll. At this stage, Tesla is only a year into the California auto market as...

Martha Porado | July 29, 2020 Canadian businesses are grappling with how to move forward with conversations around race. “In order to affect the systemic changes needed to foster inclusivity, we will need collective learning and unlearning, challenging ourselves to embrace innovative, equitable and inclusive practices going forward,” said Jon Love, chief executive officer of KingSett Capital, in a webinar hosted by Realpac and other real estate industry groups, on Monday. “I also believe it will take our industry as a whole coming together to share ideas and engage in discussions like we’re having today to embrace and champion the changes we all seek.” Read: Addressing racism as an employer must begin with listening A key component to addressing racism in the workplace is simply starting with admitting it does exist in Canada, something many Canadians are reticent to do, said Farrah Khimji, president of Toronto CREW, a networking organization for women in the commercial real estate industry. “Having been in the commercial real estate industry for over 10 years now, as both a woman and ethnic minority, I have experienced first hand the challenges that has brought. . . . I know we like to think here in Canada that we don’t have racism...

While the COVID-19 pandemic has had a broadly catastrophic impact on Canadians’ health and wealth, it’s arguably produced some happy accidents in the life insurance space. Some have pointed to the accelerated adoption of digital and simplified solutions in the midst of lockdown measures; on the consumer side, the heightened focus on mortality and business continuity has more people asking how to get life insurance, how it could impact or benefit their tax planning, and other questions. With both those developments, the stage is set for Canada to finally address its long-standing coverage gap. How big is that gap exactly, and which segments of the population are most in need? Getting a current picture isn’t easy. Depending on how one counts, it’s been just over four months after the world’s financial markets suffered the most violent fits induced by the novel coronavirus. The situation is still fluid in many ways; economies around the world, including Canada, are still in the midst of recovering, a broad range of sectors face existential questions, and the threat of a second wave still hangs in the air. The best Canadian professionals can do, at least for now, is to look at the most recent...

With the introduction of social distancing measures and lockdowns to contain the spread of COVID-19, the life insurance industry has received a long-overdue push into an era of innovation. A lot of that has happened on the digital front, notably with respect to the applications process. A significant piece of that is accelerated underwriting, which seeks to supplant the traditional mode of long wait times, invasive procurement of bodily fluids, and potentially cumbersome paper requirements. In its place, clients now stand to benefit from potentially speedier approval times and the power of predictive analytics, among other advantages. But should we assume all companies have undergone a beneficial shift to the technological? As John Grogan, EVP and chief product and innovation officer at Northwestern Mutual wrote in Digital Insurance, the convenience factor is just one element to be considered. “[T]here is an opportunity to move the conversation to best practices and competitive advantages regarding data-driven underwriting, as these have important ramifications for long-term product value and individual financial security,” Grogan said. He argued that the ability of a life insurance company to honour claims hinges on its long-term performance, which ultimately relies on mortality risk management and consistent high-quality underwriting. As...

Principal Financial Group reported about 150 claims across its life insurance business during the second quarter — a claims experience that allowed the company to dial back its COVID-19 projection going forward. Despite death numbers up to double what was expected in the spring, Principal is cutting its projected impact on earnings from $20 million to $10 million per 100,000 U.S. deaths from the virus. “We’re better able to just look at the nature of those claims, whether it be age, whether it be face amount, whether it be the size of the annuity product, and update how that translation happens between the general population experience and the experience of our insured population,” explained Deanna Strable, Principal’s chief financial officer. Principal reported a second-quarter operating revenue decline of 20.5% year over year to nearly $3.2 billion, a result of lower premiums and net investment income. However, total expenses decreased 25.7% year over year to $2.6 billion due to lower benefits, claims and settlement expenses as well as reduced operating expenses. Principal reported declines in life insurance and annuity sales, a result largely offset by strong performance at the Specialty Benefits Insurance business. As a result, its U.S. Insurance Solution segment...

Staff | July 28, 2020 The Ontario Municipal Employees Retirement System is appointing Ingrid Chingcuanco as vice-president of pension operations. She joined the OMERS nearly eight years ago as director of pension policy. In that role, she provided pension policy and project leadership for several initiatives, such as public sector divestments affecting the pension fund and enhancements to its additional voluntary contributions program. Read more People Watch news Before she joined the OMERS, she worked at Ontario’s ministry of finance, where she was director of operations and funding for the short-lived Ontario Retirement Pension Plan, manager of the pension benefits standard policy and a senior policy advisor. Chingcuanco began her career as an actuarial associate at Hewitt Associates — before it became Aon Hewitt — and was also a senior actuarial analyst at the Financial Services Commission of Ontario and manager of pension policy at the Ontario Ministry of Government Services. Read the full article at BenefitsCanada.com

Incorporation of IMS telematics technology via SDK integration with Onlia Sense safe-driving app Waterloo, ON (July 28, 2020) – IMS (Insurance & Mobility Solutions), one of the world’s top three providers of connected car data solutions to insurers, mobility operators and governments, is pleased to announce the three-year extension of its successful partnership with Onlia, a Canadian provider of innovative digital home and auto insurance and a safe-driving mobile app. “The continued collaboration between IMS and Onlia will enable us to fully exploit the value of telematics technology in delivering improved road safety through the prevention-first approach that is at the heart of Onlia Sense,” said Bob Skerrett, CEO Insurance at IMS. “We are confident that the combination of class-leading technology, rewards and insurance cashback will deliver safer driver behavior, and we are looking forward to playing our part in helping this materialize over the next three years.” Onlia Sense is a free-to-download, mobile app intended for widespread use by all Canadians. Drivers can earn rewards and badges, gain leaderboard positions and qualify for insurance cashback in exchange for safe driving behavior. “The IMS software development kit (SDK) offers us rapid development potential for both iOS and Android platforms, with...

Annual independent agent and brokerage survey reports adoption of digital technology remains steady year over year University Park, IL (July 28, 2020) – Applied Systems has announced the findings of its annual Applied Digital Agency and Brokerage Survey, providing an industry-wide benchmark for agencies and brokerages to measure their digital technology adoption and progression towards digital transformation. Survey questions assessed degree of technology adoption to calculate a digital score for each agency or brokerage and identify baselines for industry-wide technology adoption. The 2020 Applied Digital Agency and Brokerage survey results indicate that 44% is the average digital technology adoption score – nearly the same as in 2019 – revealing that there remains a significant runway of opportunity for agencies to realize the benefits that digital technology affords to service and support connected consumers. The survey questions examined five core competencies of a digital agency and brokerage, including management system capabilities, mobility, insurer connectivity, analytics and cloud software. Agencies scoring 80% or higher across all core competencies were considered to be digital agencies or brokerages, having adopted most of the key drivers of digital transformation. Key survey findings include: Digital strategies: Results showed 51% of agency and brokerage respondents have a...