Insurable Interest Canadian Insurance Blog

Staff | August 28, 2020 The U.S. Department of Labor is taking jabs at the inclusion of environmental, social and governance products in capital accumulation plans — and it could be to members’ detriment. In late June, the Department of Labor proposed new rules around ESG products in retirement accounts. “The proposal is designed, in part, to make clear that . . . plan fiduciaries may not invest in ESG vehicles when they understand an underlying investment strategy of the vehicle is to subordinate return or increase risk for the purpose of non-financial objectives,” noted a release from the department. However, a recent blog by Jennifer DeLong, head of defined contribution at AllianceBernstein, and Michelle Dunstan, the firm’s global head of responsible investing, said the regulations proposed could unnecessarily deter plan sponsors from offering ESG options. Read: CFA Institute proposing industry standards for ESG disclosure They noted the proposed rules aren’t a major shift from what’s already in place. “The new rules wouldn’t prohibit ESG options, but they could encumber the selection and monitoring process. For example, plan sponsors would need to do a lot more documenting to validate any ESG considerations on top of the current ‘all else being equal’ test. The rules would also all...

Staff  | August 28, 2020 Aon and Willis Towers Watson’s proposed merger has received approval by their respective shareholders. The merger, announced in March, remains subject to customary regulatory and other closing conditions. It’s expected to close in the first half of 2021. Upon closing, Willis Towers Watson shareholders will receive 1.08 Aon shares in exchange for each Willis Towers Watson share they held immediately prior to the closing. Read: Aon and Willis Towers Watson set to merge “On behalf of Aon’s board of directors and executive team, I would like to thank our shareholders for their overwhelming support of the proposed combination with Willis Towers Watson,” said Greg Case, chief executive officer of Aon, in a press release. “Our combination, which will accelerate innovation and strengthen our capability to provide more relevant solutions for clients, has only become more important through the COVID-19 pandemic. “The events of 2020 are illustrative of the exact type of transformative long-tail risk our new organization will be best positioned to address, creating significant value for clients, colleagues and shareholders.” Read the full article at BenefitsCanada.com

Martha Porado  | August 28, 2020 Globally mobile employees may be feeling more discouragement, burnout and stress during the coronavirus pandemic compared to their domestic peers. Indeed, outside of the crisis, expatriate employees are generally more prone to these hurdles, said Nancy Brown, national sales director for Canada at Metlife Worldwide Benefits, in a session at Benefits Canada‘s 2020 Plan Sponsor Week earlier this month. “These stresses and challenges may affect these employees’ success at work and impact their overall productivity levels, which can be detrimental, especially as organizations work through a crisis globally.” By this logic, stressors affecting domestic employees are likely amplified for globally mobile workers, she said. In an April 2020 survey by MetLife, expat respondents said they were less satisfied with their jobs and less committed to their organization’s goals than the year before. Read: Anxiety on the rise, overtaking depression as top mental-health concern: analysis “As the world works through the challenges of COVID-19, organizations need to take extra steps to keep their globally mobile employees healthy and well-informed,” said Brown. “These employees face more personal and professional challenges than their domestic peers. Business leaders need to take care of these employees as they’re away from their traditional safety nets of...

Kelsey Rolfe | August 28, 2020 Plan sponsors have to move beyond benefits plan reporting and dig into analytics to better understand medication non-adherence and the top disease states affecting their workforces. “Leveraging plan-specific data can help answer the fundamental questions needed to manage your benefits program,” said Shawn O’Brien, Telus Health’s principal of data enablement and drug, health, dental product roadmaps, during a session at Benefits Canada‘s 2020 Plan Sponsor Week earlier this month. While reporting summarizes data from individual sources and can give plan sponsors insight into their past and present drug plan experience, analytics goes further, he said, by providing insights into future trends and drawing connections between separate sources of data to drive strategic decision-making. Read: Mental-health conditions, specialty meds driving drug plan cost increases in 2019: report Drug non-adherence is a key area for plan sponsors to watch as it accounts for a large percentage of overall eligible claims cost. Non-adherence is calculated using a medication possession ratio — the time between when a plan member refills their maintenance medication compared to the number of days’ worth they have. Four of Telus’ top 10 drug classes by eligible amount were found to have significant non-adherence rates. Depression, which accounted for 5.1 per cent of total eligible claims for the organization’s book...

Jennifer Paterson | August 28, 2020 With almost 100,000 employees in 30 countries, Scotiabank’s approach to global benefits provision is more about aligning philosophy or guiding principles than it is around aligning specific tactics of the benefits plan. “No surprise, every country, every region has its own set of legislation, social norms, priorities, different health-care infrastructure and different maturity in terms of the technology space,” said Simone Reitzes, the bank’s vice-president of global pension and benefits, during a session on the first day of Benefits Canada‘s 2020 Plan Sponsor Week earlier this month. “So to take one benefits plan and try to fit it into all of our countries is like trying to put a square peg in a round hole.” Scotiabank looks at its guiding principles around total well-being and works with its business partners in all of the countries in which it operates to fit each benefits plan into the local infrastructure, she added. Read: Plan Sponsor Week: Globally mobile workers need extra help dealing with pandemic stress The bank also works closely with its vendors to collect current data and then looks at trends in its own experience, as well as its vendors’ other plan sponsor clients, to find opportunities to implement different...

Jennifer Paterson | August 28, 2020 While the vast majority of Canadians say the coronavirus pandemic is impacting their mental health, just 60 per cent are receiving the treatment or social support they need. “We’ve asked them, what are the barriers? Why aren’t they accessing the resources?” said Sophie Ouellet, vice-president of business development at Sun Life Canada, during a session on the fourth day of Benefits Canada’s 2020 Plan Sponsor Week earlier this month. The top reasons, according to a Sun Life survey conducted in April, are affordability, accessibility and stigma. “So while we’ve made a lot of progress as a society on that, it’s clear it’s embarrassment or people don’t feel comfortable talking about that in particular.” Read: 56% of Canadians say coronavirus negatively impacting mental health: survey Digging a bit deeper, Sun Life has seen mental-health incidences increase in the past few years, she added, noting it accounts for 30 per cent of the claims seen by the insurer. So what can employers do? Ouellet suggested they start by understanding the barriers, such as awareness of treatment and how to access it, issues around wait times and cost and the pervasive issue of stigma. “Many people might say, ‘We’ve made so...

Kelsey Rolfe | August 28, 2020 Plan members living with insomnia or sleep problems could benefit from sleep-specific cognitive behavioural therapy programs accessible through their benefits plans. “One of the key things I’m going to say is benefits plans should offer some sort of online cognitive therapy for sleep,” said Atul Khullar, medical director of the Northern Alberta Sleep Clinic, in a session during Benefits Canada‘s 2020 Plan Sponsor Week earlier this month. “This would help me as a sleep specialist because if [patients have] done this [and found little or no relief], I can be a little more aggressive with medications.” While 30 to 40 per cent of adults experience insomnia symptoms, only nine to 13 per cent meet the diagnostic criteria for an actual disorder, he noted. Even so, sleep issues among plan members — which can be linked to mental-health issues, chronic pain or medical conditions — are a large productivity cost to plan sponsors. Read: Majority of Canadians suffering from a mental-health issue, sleeping disorder: survey “Good sleepers are much less of an economic burden than people with insomnia disorders and even individuals with a little bit of insomnia symptoms. So even if you have some insomnia symptoms, some early intervention, I think, would be warranted.” He pointed to...

Empire Life is joining a wave of insurance providers that are beefing up their group insurance plans with telemedicine services as the COVID-19 pandemic continues to hamper in-person consultations. Starting on September 1, all group plan members with Empire Life group health benefits will be automatically given access to the new service provided by Teladoc Health. After setting up a Teladoc profile, group plan members will be able to connect with a doctor in minutes, or set an appointment time if they wish. “We’re hugely excited to bring this timely and convenient service to our customers,” said Vanessa Lycos, vice president, Group Product and Marketing at Empire Life. Citing figures from the Angus Reid Institute, she said nearly two out of five Canadians report having faced COVID-19-related barriers to medical care. According to Statistics Canada, nearly five million Canadians do not have a regular care provider. Meanwhile, the Canadian Institute for Health Information (CIHI) reports only 16% of primary care doctors have capacity and are accepting new patients who request an appointment, and just 43% of Canadians report being able to get a same- or next-day appointment at their regular place of care when they last needed medical attention. “With...

Coefficient established to help employers realize greater value through “precision risk,” a new data-driven solution to employer stop-loss insurance Palo Alto, CA (Aug. 25, 2020) – Verily, an Alphabet company, is announcing a new subsidiary, Coefficient Insurance Company, that will be backed by Swiss Re Corporate Solutions, the commercial insurance unit of the Swiss Re Group. Coefficient will combine innovative health technology solutions with novel insurance and payment models. Its precision risk solution helps self-funded employers to control cost volatility through a data-driven model that is unique in the traditional employer stop-loss market. Employer stop-loss is a segment of commercial insurance that protects self-funded employers from unexpected and large employee health benefit claims by reimbursing employers for claims above a defined amount. Coefficient will leverage Verily’s core strengths integrating hardware, software and data science and will also leverage Swiss Re Corporate Solutions’s risk knowledge, distribution capabilities and reputation in the employer stop-loss market. Coefficient’s precision risk solution is designed to provide self-funded employers with more predictable benefit plan protection. It uses an analytics-based underwriting engine to identify unexpected areas of cost volatility, and cover those exposures with more dynamic and precise insurance policy provisions. Over time, Coefficient plans to integrate...

Staff  | August 27, 2020 The average Canadian employee will have to accumulate 10.9 times their final pay to maintain the same spendable income once they retire, according to a new report by Aon. The report defines retirement income adequacy as having the same spendable income after retirement as before, taking into account changes in savings, taxes, medical expenses and other factors. It compares the anticipated accumulation of retirement savings (as a multiple of final pay) to the target accumulation required to maintain an employee’s standard of living after retirement. “The retirement readiness gap is real for Canadian workers,” said William da Silva, senior partner and Canadian director of retirement solutions at Aon, in a press release. “This is an opportunity for employers to ask the right questions: Are contribution levels appropriate and designed in alignment with the plan sponsor’s objectives? Are employees equipped with resources to manage their finances and plan for their retirement? Do employees understand the impacts of medical cost inflation and other post-retirement expenses? Clearly, there’s a need to look both at the substance of workplace retirement programs and at the ‘soft’ levers of education and information.” Read: Retirement system must reflect Canadians working longer: report The report...