Insurable Interest Canadian Insurance Blog

Best’s Market Segment Report Oldwick, NJ (Sept. 8, 2020) – Canada’s property/casualty insurance industry thus far has fared better than their life counterparts amid the volatile economic and market dynamics created by the COVID-19 pandemic, according to a AM Best report. In its Best’s Market Segment Report, titled, “COVID-19 Taking Its Toll on Canada’s Economy and Insurance Industry,” AM Best states that the country’s overall insurance industry remains well-capitalized. However, for Canada’s life insurance industry, top-line growth has been materially affected, as consumers reacted to COVID-19-fueled economic strain, and agents and life insurance representatives transitioned with varying degrees of success to a digital sales environment. Life insurers’ operating earnings also have been impacted because of the market dynamics and asset valuations, and earnings likely will be pressured by the prolonged volatility in the equity markets and low interest rates, leading to lower fee-based revenue as well. In April, AM Best revised its outlook on Canada’s life insurance industry to negative, owing to the significant disruption to the financial markets caused by the COVID-19 outbreak. AM Best remains concerned about companies with higher exposures to commercial mortgage loans, particularly in the hotel and retail segments, as well as office space, given...

John Carroll LL Global, Inc., the parent organization for LIMRA and LOMA, today announced it has hired John Carroll to lead its National Accounts team. He will report to Sean O’Donnell, senior vice president, LL Global Member Relations and Sales. Carroll has served in executive positions for leading financial services companies over the past 25 years, including Merrill Lynch and Allianz Global Investors. Most recently, he was head of intermediary client relations for Epoch Investment Partners, where he was responsible for developing and executing business plans to improve client coverage, deepen engagement, and drive growth. “COVID-19 has presented unique challenges for our members as economic and physical conditions have redefined their business operations and goals. It is critical that LL Global not only develop timely and indispensable resources that support our members, but build a dynamic relationship team that can transform our engagement strategy and ensure we deliver unique value to our membership and to the industry we serve,” said O’Donnell. “Throughout his career, John has focused on developing new processes, building teams and leveraging data to enhance the client experience while improving business results. We are confident that John will bring the same energy, business acumen and leadership to...

Staff  | September 14, 2020 The world’s 300 largest pension funds saw their assets under management increase in value by eight per cent in 2019, to a total value of US$19.5 trillion, according to new research by Willis Towers Watson’s Thinking Ahead Institute. This is compared to a 0.4 per cent decline in the value of assets in 2018. “Overall, the world’s largest pension funds staged a strong rebound in growth in 2019, following a tough market environment the year before,” said Roger Urwin, co-founder of the Thinking Ahead Institute, in a press release. Read: Five Canadian pension funds rank in top 100 global asset managers: report “However, this positive result does not detract from the multiple pressures currently facing pension funds, from concerns around solvency levels to rising expectations with regards to [environmental, social and governance] considerations and, in particular, climate and social issues.” Urwin also noted the ramifications of the coronavirus crisis and anticipated economic uncertainty ahead that will make pension fund boards’ agendas more complex. When looking at the top 20 pension funds, assets under management saw an 8.1 per cent increase in 2019 and a compound annual growth rate of 5.5 per cent over the past five years,...

A group of U.K. researchers have shared their findings on how race, age, and comorbidities impact mortality among patients with COVID-19 in a newly published study. The paper, published on PLOS and titled Comorbidities Associated with Mortality in 31,461 Patients with COVID-19 in the United States: A Federated Electronic Medical Record Analysis, comes from a team of authors from Liverpool Center for Cardiovascular Science, University of Liverpool and Liverpool Heart & Chest Hospital in the United Kingdom, as well as TrinetX. A global health research network based in the U.S., TrinetX describes itself as “the market leader in protocol design, feasibility and site selection” for clinical trials. It covers 150 healthcare organizations across 25 countries, and collaborates with most of the corporate leaders into the industry, including 13 of the top 15 pharmaceutical companies. The researchers analysed data from de-identified electronic medical records of COVID-19 patients across a network of 29 healthcare organizations in the U.S. The network was searched between January 20 and May 26, 2020, and the sample population had a median age of 50 years, with 54.5% being female. “We determined associations between age, sex, ethnicity, comorbidities, and death with COVID-19 during the study period,” the authors...

Staff | September 11, 2020 A majority (82 per cent) of senior managers said they’re worried about their company’s ability to retain valued staff, with 34 per cent saying they’re very worried, according to a new survey by Robert Half Canada Inc. Among this group, 41 per cent attributed their concern to salary reductions or planned salary freezes for the near future. “The pandemic has caused organizations to shift into high gear and many employees have taken on heavier workloads,” said David King, Canadian senior district president at Robert Half, in a press release. “Although some companies are offering non-monetary perks, such as options for greater flexibility in the workday or access to important health and wellness resources, many have also been forced to reduce or freeze salaries. Because of this, employers have growing concerns about their ability to retain high-performing employees as they continue to weather the economic impact of COVID-19.” Read: Employers using hiring, wage freezes to combat effects of coronavirus: survey The survey also found more than half (56 per cent) of respondents said starting salaries for new hires have held steady since the pandemic began, while 19 per cent noted an increase in base compensation. In addition, 81 per cent of...

Staff | September 11, 2020 Medcan is partnering with fitness app Lift to enhance its wellness offering to plan sponsors. The platform, which includes customized exercise programming, digital equipment and digital assessments, aims to offer highly engaging virtual training sessions, partnered with Medcan fitness coaches. “Fitness is one of Medcan’s key pillars,” said Andrew Zimakas, the organization’s chief product and revenue officer, in a press release. “We chose Lift session as our virtual fitness partner because their platform allows for an exceptional and personalized client experience . . . and the team is fully aligned with our philosophy.” Read: Morneau Shepell, Lift partner on virtual fitness programs David Sciacca, chief operating officer at Lift, said there’s no better proactive health management approach than building fitness into our lifestyle. “Extending Medcan’s reach through virtual fitness will allow their experts to have an even bigger impact on their client’s health and accelerate progress towards their goals. Together with Medcan, we are making elite fitness coaching available and accessible to Medcan clients from anywhere in the world.” Read the full article at BenefitsCanada.com

Kelsey Rolfe | September 11, 2020 Real estate, a long-time stable, returns-generating asset class for pension plans, may no longer be as solid due to the impact of the coronavirus pandemic. “A pretty traditional asset class for pension plans may have been in office and retail, but one of the changes that’s happened is [the move to] remote working,” said Barbara Zvan, president and chief executive officer of the University Pension Plan, in a webinar hosted by the Association for Canadian Pension Management on Thursday. “If you think about Toronto downtown, how many of these organizations will start doing more remote working and may not need that space?” The rise of online shopping could have a similar impact on brick-and-mortar retail, she added. “How will that impact valuations going forward and the possible growth prospects in retail? I think people have always been big internet shoppers because we’re busy, but a lot of people have gotten more used to internet shopping [during the pandemic]. . . . That [impact] will take time to work through, but it’s definitely top of mind.” Read: 2020 Top 40 Money Managers Report: Hold your ground  Chris Brown, president and CEO of the Local Authorities Pension Plan in Alberta, also...

Martha Porado | September 11, 2020 The coronavirus pandemic has hit the U.S. dollar hard, disrupting a dynamic that Canadian pension funds have taken advantage of for years. Unhedged exposure to the U.S. dollar has been a boon for Canadian pensions as they’ve reaped the extra returns from the favourable conversion of asset income back into Canadian currency. But the outlook for the U.S. dollar is looking sketchier than it has for some time, says Aaron Hurd, senior portfolio manager at State Street Global Advisors. “You just had a nine-year Canadian dollar bear market and the U.S. dollar added enormous tailwinds to performance on a trend basis. On top of that, you have the nice — albeit temporary — diversification during little shocks like December 2018, to some extent, but mostly with March, where you go from $1.34 to $1.47 in a matter of weeks, as equities collapsed. So that’s obviously great diversification.” Read: Back to basics on currency hedging While the nearly decade-long cycle was positive for Canadian investors, the next nine might not be so kind, he says. “Given the size of the U.S. component for the majority of Canadian institutional portfolios, if you’re giving up, we would expect upwards of two to three...

Staff  | September 11, 2020 In response to the coronavirus pandemic, more than half of Canadian employers (53 per cent) are enhancing their well-being programs, while 27 per cent are planning to make changes to improve health benefits, according to a new survey by Willis Towers Watson. The survey, which polled nearly 150 Canadian employers with more than 800,000 employees, also found only four per cent of survey respondents said they’ve reduced or are planning to reduce health-care benefits during this time. “Despite the significant challenges facing employers and employees this year, it is encouraging that most organizations are taking steps to either maintain or enhance their employee health and well-being programs,” said Christiane Bourassa, the organization’s Canadian innovation leader for health and benefits, in a press release. “Employers are doing what they can to support their workers and their families with a focus firmly on the future.” Read: 75% of global workers feel employers are looking after their well-being during coronavirus The survey also found supporting physical and emotional health is a top priority for most employers, with 57 per cent saying they believe the coronavirus will have a moderate to large negative impact on employee well-being. In particular, 45 per cent of employers said they’re...

The COVID-19 pandemic has disrupted practically every facet of daily life for Canadians, and it’s having an ongoing impact on people’s mental health across a variety of population segments. That’s the conclusion of Morneau Shepell’s latest Mental Health Index report, which reflects findings from data obtained during the month of August. From a pre-2020 benchmark of 75, the latest report showed a Mental Health Index score of -11, indicating a broad decline in mental health. Sub-scores also showed consistently increased risk across different dimensions of mental health, including anxiety (-12.9), depression (-12.1), and isolation (12.1). Drilling deeper into the data, the report found Canadians with no children have been less negatively impacted (-9.9) than those with one (-15.2) or two (-13.0), pointing to heightened concerns around safely reopening schools and getting children back into the classroom. Similar worries were reflected in the index scores of those working in the education sector (-11.6), as well as post-secondary students (-28.5). “September will be a particularly difficult month for Canadians, as they face another major change in routine and new challenges,” said Paula Allen, senior vice president of research, analytics and innovation at Morneau Shepell. The idea of a “new normal” has gained...