Insurable Interest Canadian Insurance Blog

Strong opportunities for economic growth, primarily through technology, but volatile scenarios could be a threat Fourth edition of The Real Economy: Canada report looks at challenges and trends that might impact the Canadian economy next year Toronto, ON (Dec. 16, 2019) – RSM Canada, the leading global provider of audit, tax and consulting services focused on middle market businesses, has launched its fourth edition of The Real Economy, Canada – a quarterly report that provides Canadian businesses with economic analysis and insights into factors driving growth in Canada’s middle market. Off the back of a recent federal election and a year of economic uncertainty, the latest report shines a light on what’s in store for Canada’s economy in 2020, exploring potential opportunities for the country’s growth next year, and highlighting some of the main geopolitical and industry headwinds that could slow the economy. Key findings in this quarter’s report include: Technology will be a key driver in the growth of Canada’s manufacturing sector in 2020. Canadian technology-based enterprises have grown faster than other industries since 2018. The country’s IT and communications sectors are growing at a 4% rate, and durable goods manufacturing jumped 2.5% in August. This upward trend is...

Ontarians encouraged to take a closer look at their travel insurance Thornhill, ON (Dec. 16, 2019) – As the busy holiday travel season approaches, Orion Travel Insurance, a CAA-owned company, is urging Ontario travellers to take a closer look at their travel and medical insurance coverage. As of January 1st, OHIP will no longer cover any portion of out of country medical expenses. “We know that 25 per cent of Ontarians travel without insurance and that’s the reason for concern. Medical emergencies can happen anytime, anywhere,” says Kellee Irwin, vice president, Orion Travel Insurance Company. “It’s critical that people are aware of the upcoming changes to OHIP. Knowing that they have coverage that meets their needs, whether it’s for a long international trip or a quick cross border trip, will give them peace of mind.” Currently, OHIP offers a maximum of $400 a day for emergency in-patient services outside of Canada and an additional $50 a day for emergency outpatient services as well as doctor’s services, but this will end on December 31st. Going forward, the provincial government will continue to cover $210 per treatment for kidney dialysis patients abroad, which can cost up to $750 a day in the...

Quebec City, QC (Dec. 13, 2019) – iA Financial Group is pleased to announce its commitment to offsetting its greenhouse gas (GHG) emissions through the purchase of carbon credits. Beginning in 2020, the company will work to become carbon neutral. Carbon-neutral company certification certifies that all GHG emissions that cannot be eliminated by iA Financial Group’s reduction measures have been calculated and offset. Offsetting does not give the right to pollute nor does it seek to make GHG emissions more acceptable. Instead, offsetting is a mechanism that allows iA Financial Group to take concrete action by investing voluntarily in climate-related projects by reducing GHG in the atmosphere. By purchasing carbon credits, iA Financial Group will invest in three projects in Canada and the U.S. chosen in conjunction with its partner, Planetair, a leader in the fight against climate change: Reforestation project (Quebec): This project will help reduce the volume of greenhouse gasses by planting ten species of trees. These species will be planted primarily in the Laurentides, Landaudière, Montérégie and Outaouais regions. With iA Financial Group’s investment, nearly 29,000 trees will be planted. Conservation project (British Columbia): This project will help reduce the volume of greenhouse gasses in the atmosphere...

Productivity gains from augmentation of workforce could deliver US$117 billion to firms in North America, with automation cost savings adding US$23 billion more: Accenture study New York, NY (Dec. 12, 2019) – Financial services companies in North America could unlock up to US$140 billion in productivity gains and cost savings by 2025 if they employ new technologies that help improve the efficiency and effectiveness of their workforces, according to a recent study by Accenture. The study, Workforce 2025: The Financial Services Skills & Roles of the Future, shows that disruptive technologies that augment human expertise, creativity and skill with real-time information and new capabilities or automate routine tasks and processes will change the shape of the financial services workforce over the next five to 10 years. According to the study, up to 48% of tasks in the financial services workforce could be augmented with technology by 2025 to increase productivity. For example, artificial intelligence (AI) and other technologies could help financial advisors make personalized real-time recommendations and help loan officers determine default risks more accurately. The study estimates that augmentation could help banks, insurers and capital markets companies generate productivity gains of US$59 billion, US$37 billion and US$21 billion, respectively....

Staff  | December 17, 2019 Heading into 2020 and beyond, the outlook for interest rates is impacting the federal government’s projected pension obligations and its budgetary balance. In its 2019 fall economic update on Monday, the government reduced the projected budgetary balance by $4.2 billion in 2019/20 and $11.6 billion in 2024/25. While the balance projections aren’t entirely related to pension obligations, the update emphasized the increased expenses around actuarial re-evaluations of public sector employee pensions and other future benefits. These expenses include “veterans programs and Royal Canadian Mounted Police disability programs, health-care and dental care benefits for pensioners, as well as a number of smaller benefit plans,” the update said. It noted the government calculates its future obligations for these benefits based on year-end interest rates. Read: Appeal court upholds ruling in RCMP pension case Finance Minister Bill Morneau stressed the government’s positive outlook for Canada’s economic landscape, putting particular emphasis on solid job and wage growth. “You’re seeing that low interest rates make pension liabilities higher and that creates the financial presentation that we’ve shown,” he told a press scrum. The update also noted that, while it’s important for the government to be transparent about the results of actuarial re-evaluations of its pension obligations, they can...

Kim Siddall  | December 17, 2019 The beginning of a new year is a great time for employers to reflect on their benefits plans and take steps to get in ahead of potential challenges. Here are four ways to set the benefits year off on a good foot: 1. Review the company’s benefits philosophy Every organization should have a philosophy that drives the design and structure of the plan, as well as decision-making about direction and business exceptions. Employers should review the benefits philosophy periodically to ensure its tenets are still relevant to the organization as it changes and evolves over time, and that the plan still matches that philosophy. Read: Using benefits plan design to drive employee engagement Questions to ask include: Does the program align with the organization’s intentions in terms of what and who is covered? Is the philosophy addressing organizational challenges, such as rising disability costs due to mental-health issues, high turnover or low employee engagement? What are the projections for growth or reductions in the workforce for the coming year? Does the benefits philosophy still make sense in this context? A high-level review of why an organization has a benefits program in the first place, and what it’s trying to accomplish, can be a helpful exercise,...

Staff | December 16, 2019 Manitoba Premier Brian Pallister is calling for a merger of the management services for the province’s public-sector pensions. Pallister says he’s not suggesting the funds themselves merge — only that they be managed as a group. A much larger pool of funds would be subject to lower management fees, he says, which could save roughly $200 million a year on a combined pool of $40 billion. Read: Manitoba pension consultations to consider target-benefit, shared-risk plans Pallister says those savings could boost the pension funds’ long-term sustainability or be reinvested to increase returns. Government officials are to meet with people who oversee the various public-sector pension funds in the coming weeks to discuss the issue. Read the full article at BenefitsCanada.com

Continuing strategy to expand operations in the Canadian employee benefit and pension space Toronto, ON (Dec. 16, 2019) – Navacord Corp., a leading Canadian insurance and risk management brokerage, is pleased to announce the addition of Ontario-based SmartChoice Benefits Inc., effective December 12, 2019. Focused on developing group benefits products for more than 25 years, SmartChoice provides affordable, comprehensive benefit plan options tailored to niche business segments that have been traditionally underserved by the group insurance market across Canada, including contracted employees, small businesses and franchises. With the addition of SmartChoice, Navacord is further expanding its employee benefits and pension offerings, which it sees as an organic evolution of its business strategy to provide a more robust service offering to clients. “We’ve invested considerably in designing and building benefits packages that make it easy and affordable for our clients to offer the comprehensive coverage they need to be competitive in the market,” says Zeke Oudeh, Founder & CEO of SmartChoice. “Joining Navacord provides us with additional infrastructure and the strength of a national company that will help take our business to the next level.” Navacord saw the opportunity to further expand its expertise and risk management approach and, thanks to...

Kelsey Rolfe | December 16, 2019 The union representing 33 employees of the Northumberland County social services department says the county is attempting to weaken employees’ short-term disability leave and remove their right to work a compressed workweek. On Dec. 12, the Canadian Union of Public Employees Local 3725 began contract negotiations with the county using a provincially appointed conciliator. Union members — who are county employees in income support, housing, childcare and outreach — have been working since Sept. 30 without a contract. Jaime Bingham, president of Local 3725, says a second day of conciliation will be scheduled for the new year. Read: Western Forest Products, union at impasse over LTD benefits, wages Currently, union members have a short-term disability plan that provides employees with 17 weeks of sick leave paid at 100 per cent of their salary. Northumberland County is seeking to remove that provision and replace it with three days of fully paid leave, with the remainder of an employee’s leave paid at 75 per cent. “We have an aging workforce, so . . . more and more of our workers are going off [to have] necessary surgeries,” said Bingham. “Reducing [the STD leave] to 75 per cent means you may refuse...

Brown & Brown, Inc. Enters into Agreement to Acquire Special Risk Insurance Managers, Ltd. Daytona Beach, FL (Dec. 9, 2019) – J. Scott Penny, Chief Acquisitions Officer of Brown & Brown, Inc., and Mark Woodall and Tom Willie, the principals of Special Risk Insurance Managers, Ltd. (“Special Risk”), are pleased to announce that Brown & Brown Programs (CA), Inc. has entered into an agreement to acquire the assets of Special Risk. The transaction is expected to close effective January 1, 2020, subject to certain closing conditions. Founded in 1991, Special Risk has grown to a preeminent player in the MGA industry in Canada, recognized as MGA of the Year in 2018. The acquisition of Special Risk is a strategic step forward for Brown & Brown in establishing a presence in the Canadian insurance brokerage market. Special Risk will operate as a part of Brown & Brown National Programs, which, under the leadership of Chris Walker, consists of over sixty specialty niche programs and collectively represents over $3 billion in written premium. Special Risk will become a distinct operating division in the National Programs Division alongside specialist operations such as Arrowhead General Insurance Agency and Bellingham Underwriters. Mark Woodall will continue...