Insurable Interest Canadian Insurance Blog

Carriers must find new and innovative ways to connect with their policyholders in order to drive loyalty and retention, according to a new Aite Group report Boston, MA (June 10, 2020) – With increasing costs, customer retention is becoming a key battleground for traditional carriers, and home insurance policies can provide an opening for carriers to build relationships with their customers like never before. Consumers are discovering the benefits of connected devices, which are creating new data streams for insurance carriers to use for customer engagement. The latest Aite Group report, U.S. Home Insurance: Get Connected to Build Customer Loyalty, explores how matching the use of connected devices with personalized advice programs can increase communication points with customers, enabling better marketing and claims efforts while building trust. “Carriers looking for additional contact points can leverage the connected-device ecosystem to provide more value for customers through personalized advice and information,” states Greg Donaldson, senior analyst with Aite Group. The report provides insights on homeowners and renters insurance policyholders’ ownership and use of connected devices and their willingness to share this information with their insurance carrier. It is based on a Q1 2019 Aite Group online survey of 766 U.S. policyholders who...

Staff | June 15, 2020 Optima Global Health is partnering with MindBeacon to offer its online cognitive behavioural therapy service to plan sponsors. “Mental health is more important than ever for our customers in today’s uncertain world,” said François Laflamme, president of Optima Global Health, a Quebec-based employee assistance program provider, in a press release. Read: MindBeacon launches digital mental-health programs to help Canadians with coronavirus-related stress “Our partnership with MindBeacon represents a great step forward in providing them with the highest quality of evidence-based digital therapy. By having the added convenience of accessing therapy wherever they choose, Optima Global Health customers can place a greater emphasis on their well-being when they may need it most.” Read the full article at BenefitsCanada.com

There are opportunities to adapt the life insurance sales process to take better advantage of digital technology, according to a J.D. Power analyst. The only question is whether the will is there to make it happen. “A lot of the digital that’s been created for life insurance specifically is really simply taking an analog process and putting it on a screen,” said Robert Lajdziak, insurance business consultant for the Insurance Practice at J.D. Power. “It’s not creating a new process that takes advantage of the capabilities that a digital experience can have.” According to the J.D. Power 2020 U.S. Insurance Digital Experience Study, insurers have made across-the-board improvements in clarity of information, but many still struggle with the balance of too much information and a minimalist approach. Significant investments in direct-to-consumer website and mobile design have helped property and casualty insurance companies emerge as an industry leader with improved digital service and shopping experiences. “One of the key takeaways for digital being successful is that it does have to address a pain point,” Lajdziak said. “You can’t just take an analog process and put it on a screen and expect it to be a success. It really does have to...

By Greg Boutin, CEO, Relay Platform — It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change, that lives within the means available and works cooperatively against common threats.Charles Darwin In recent weeks, due to social isolation measures, we have seen proof that even our largest, most conservative clients can quickly pivot and adopt new technological advancements to improve the sustainability of their business, and enable a suddenly remote workforce. So why do so many organizations in the insurance/reinsurance business still rely on outdated core systems? Why do underwriters, ceding teams, MGA/MGUs, and reinsurers still rely on woefully inadequate shared folders, emails, Excel or PowerPoint workarounds instead of industry-tailored solutions? Why has so much money been wasted on failed (re)insurance risk transfer platforms? Turns out the problems are evident, but they persist because we have not been listening to end users. It all goes back to the user experience revolution Ideas like Usability and Interface have yet to sweep through the (re)insurance world, and the hundreds of industry folks we’ve spoken with agree. What we need now is what Bill Gates, Steve Jobs,...

Sun Life Canada advisors host more than 55,000 virtual individual client meetings during COVID-19 Toronto, ON (June 15, 2020) – Sun Life Canada has accelerated its digital transformation to make it easier for clients to get the help and advice they need. At a time when health and financial security are top of mind for all Canadians, Sun Life is delivering innovative solutions for clients and advisors when they need us most. “Like all Canadians from coast to coast, at Sun Life, we’re navigating the COVID-19 global health crisis,” said Jacques Goulet, President, Sun Life Canada. “Our 155 years of experience has shown that we play a critical role in challenging times. With our clients and advisors top of mind, and a focus on sustainability, we have made a number of digital enhancements to make it easy for Clients to get the help they need. We are committed to being part of the solution for all Canadians.” Sun Life Canada advisors have accelerated their digital adoption and have quickly pivoted to support new and existing Clients during this time. Notable examples include: Using eSignature capabilities for 54 per cent of transactions in the month of May – an increase of...

By Ralph Dittrich With today’s unprecedented market dynamics, it’s imperative that we insurance professionals learn to adapt. Similar to how a chameleon adapts to its environment in order to thrive, we find ourselves adjusting the way we communicate and work, as well as adapting our products and services to meet changing needs. COVID-19 has helped move a traditionally slow-to-evolve industry in a more chameleon-like way. Insurance carriers have made multiple changes to their underwriting guidelines and product portfolios. Products may have slightly different features or requirements, but they still blend seamlessly into individuals’ financial and retirement plans – just like the chameleon to its surroundings. Something Old, Something New We have seen more changes In the few months since the start of the pandemic than we typically see in most years! Social distancing, stay-at-home orders, and restrictions on exam services in many locations heightened the need for simple, no-exam options for life insurance. Accelerated underwriting programs have been around for several years now; however, carriers have been expanding their issue age ranges and face amount limits to allow many more applicants to qualify. Although accelerated underwriting programs may offer an opportunity to waive exams for most clients, not all clients...

Kelsey Rolfe | June 15, 2020 While 72 per cent of Canadian employers said they’ll make minimal or no changes to their benefits coverage in 2021, 21 per cent are planning some plan design changes around health coverage, according to a new survey by Arther J. Gallagher & Co. Eight per cent said they’re looking at plan design and contribution structure changes, while just four per cent said they expect to make major strategic changes to their benefits offerings. Employers also said they expect to expand their well-being offerings, with 19 per cent saying they’ll increase their program offerings to help employees with their overall well-being and 37 per cent saying they’ll include new resources and tools for overall well-being. As well, 37 per cent said they plan to include additional support for emotional well-being, 19 per cent said they’ll up their financial well-being support, 10 per cent plan will increase community/social support and six per cent said they’ll offer additional physical support. Meanwhile, 40 per cent said they’re not implementing any changes to their well-being program. Read: Should plan sponsors shift their benefits plan spend during coronavirus? “We might see some specific changes being contemplated instead of the benefits program through extending psychology benefits, introducing...

By Matthew Daly While the COVID-19 pandemic will likely impact the claims side of the insurance industry, it is also affecting another component: insurance company investment portfolios. Many insurers invest most of their customers’ premium dollars in investment-grade securities (those rated AAA through BBB, which carry NAIC 1 or 2 designations). Insurers have a long history of investing in safer investments such as AAA-rated U.S. Treasuries, but the past decade’s historically low interest rates led insurers further into generally higher yielding assets, including IG corporate bonds. However, Conning believes that the economic damage caused by social-distancing measures and business closures to slow the spread of COVID-19 has in turn damaged U.S. corporate credit profiles. Conning currently expects corporate earnings to be dramatically impacted by higher unemployment, reduced consumer spending and weak business investment. Companies are also aggressively drawing on credit facilities and raising cash via record bond issuance, ensuring they have adequate financial flexibility to survive a potentially deep reces­sion. Advertisement This increased debt, combined with expected lower earnings, should contribute to weaker credit metrics and a general deterioration of corporate credit profiles. This is of special concern for insurers, who face increased risk-based capital charges if securities in their...

Given longer-than-ever life expectancies, Canadians face a greater-than-ever risk of outliving their retirement savings. This is compounded by the fact that, in the case of RRIFs, they’re required to withdraw a minimum amount of taxable income starting on the year they turn 71. A new type of annuity can offset that risk – but there are limitations that retirees must keep in mind. As noted by Lydia Roseman and Michelle Fong of McLennan Ross LLP, the advanced life deferred annuity (ALDA) allows individuals who do not need to draw down their registered funds at age 71 to continue holding some of their funds tax-free until they’re 85 years old. “The ALDA is also a great tool for longevity planning,” Roseman and Fong wrote in a blog post. “By purchasing an ALDA, you ensure that there are funds available to support you in your (much) later years.” As drafted, the legislation implementing the ALDA indicates that it came into effect on January 1, 2020, though it has yet to be enacted. Under the legislation, an ALDA can be purchased under several types of plans, including an RRSP, a RRIF, and a deferred profit sharing plan, among others. It’s also regarded as...

Staff | June 12, 2020 The market value of assets in Canadian employer-sponsored pension plans rose to $2.09 trillion in the fourth quarter of 2019, up 2.3 per cent from the previous quarter, according to new data from Statistics Canada. All investment categories saw growth, led by real estate (4.9 per cent) and public equities (4.5 per cent), with mortgages (three per cent), other assets (two per cent) and short-term investments (0.7 per cent) posting smaller increases. Bonds saw modest value growth of 0.1 per cent. “The onset of COVID-19 in March has affected the market value of assets held by Canadian trusteed pension funds,” noted Statistics Canada. “The data in this release will serve as a benchmark to help evaluate the impact of COVID-19 on the investments of trusteed pension funds in Canada.” Read: Market value of Canada’s trusteed pensions continues to grow: Stats Can During the quarter, domestic assets hit more than $1.3 trillion, an increase of 1.1 per cent from the third quarter and 13.7 per cent year-over-year. While the value of domestic mortgages (10.7 per cent), real estate (seven per cent), miscellaneous assets (2.1 per cent) and bonds (0.2 per cent) increased, short-term investments dropped by 0.5 per cent, equities...