Insurable Interest Canadian Insurance Blog

The Canadian Press | September 18, 2019 The University of California is dumping fossil fuel investments from its nearly $84 billion pension and endowment funds, calling them a financial risk. An opinion article in Tuesday’s Los Angeles Times says the university will make its endowment fund “fossil free” by month’s end and its pension fund, which covers 320,000 people, will soon follow.  Read: Divesting from fossil fuels doesn’t mean sacrificing returns: report The article was written by the university’s treasurer and the chair of its Board of Regents Investment Committee. A global campaign for universities and other organizations to disinvest has been waged by climate activists for nearly a decade but the article says the decision was made for financial rather than political reasons. The article says the university is placing bets “that clean energy will fuel the world’s future.” Read the full article at BenefitsCanada.com

Falls Church, Va. – The National Association of Insurance and Financial Advisors announced the creation of the Talent Development Center which focuses on providing personal development programs to serve every stage of a financial service professional’s career. The new Center was announced Sept. 14 at NAIFA’s 2019 Performance + Purpose Conference held in Orlando, Florida.  “With a current workforce seeing massive numbers of professionals leaving the industry each day to retire, we’re faced with the need to grow a new generation of financial services professionals who adhere to a Code of Ethics and work to serve the more than 90 million American families that NAIFA serves,” stated Kevin Mayeux, CEO of NAIFA. To create the Center, NAIFA quickly tapped its Diversity & Inclusion Task Force that was created four years ago as part of NAIFA’s 20/20 Strategic Plan. “One of the key driving programs within the new Center is the work that has come from the Diversity & Inclusion Symposiums,” explained task force member, Wes Booker. “Our work over the last four years has produced programs that can aid companies and agencies in recruiting and retaining a new workforce that mirrors the changing face of Main Street USA. We see...

Novarica’s annual report profiles 200 InsurTechs with focus on opportunities to partner, learn, and create value Boston, MA (Sept. 17, 2019) – As the wave of investment in InsurTech continues and more of innovative new startups bring offerings to market, most insurers’ initial fears are turning to curiosity. InsurTechs are increasingly seen as chances for insurers to partner, license technology, or to learn. In a new report, InsurTech for Insurers: 200 Startup Profiles, research and advisory firm Novarica outlines the InsurTech landscape today and profiles 200 startups, focusing on the relevance of each to incumbent insurers. “Not every InsurTech startup will interest every insurer; not every insurer will decide to partner with or invest in InsurTech startups. However, every insurer should take stock of what is happening in the space and learn the lessons that will make their organization stronger,” said Jeff Goldberg, Executive Vice President of Research and Consulting and co-author of Novarica’s new report. “Across all lines of business and across all sizes, insurers will feel the impact as InsurTech startups shift customer expectations and point the way for more effective, insightful operations.” Key findings include: AI is everywhere. The space has seen a rise in insurance-specific conversation...

Toronto, ON (Sept. 12, 2019) – There is little doubt that artificial intelligence is among the most powerful innovations in the market today. But what are the opportunities and risks of this technology, and how can companies adopting AI ensure it is used responsibly? A new TD report brings together insights from a survey of Canadians and an expert roundtable to explore these questions. The report, entitled Responsible AI in Financial Services, shows that while Canadians recognize the value that AI can add to their lives and want their banks to keep pace with innovation, they’re looking for a greater understanding of the technology and how it is being used. Canadians are adopting AI, but they have concerns The report found that the majority of Canadians (72%) are comfortable with AI if it means they will receive personalized services. But nearly the same number (68%) said they are concerned they don’t understand the technology well enough to know the risks. Expert roundtable identifies three areas of focus The concerns of Canadians were reinforced at a recent roundtable hosted by TD in Toronto that brought together AI experts from multiple sectors, including financial services, technology, fintechs, academic and not-for-profit organizations. The...

Jericho, NY (Sept. 17, 2019) – J.S. Held, a global consulting firm, announced today that it has acquired SPECS (Specialized Property Evaluation Control Services). Headquartered in Langley, British Columbia, SPECS is the largest property risk and loss quantification consulting firm in Canada. The firm is recognized as a trusted partner in helping insurers, facility managers, property owners, and risk managers accurately identify, evaluate, and quantify risk, loss, damage, and corresponding financial costs. Founded in 1995, SPECS’ expertise includes property damage assessments, restoration consulting, construction project administration, risk management, facility services, and catastrophic response. The SPECS team of engineers, construction specialists, estimators, and appraisers support the insurance, legal, and construction communities from 18 offices across Canada. SPECS is also the first national consulting firm in Canada to obtain a nationwide Special Flight Operations Certificate (SFOC) from Transport Canada, enabling their qualified team of drone pilots to conduct drone inspections anywhere in the country. “With the addition of SPECS into our global operations, J.S. Held holds the unique position as the technical services consulting leader in Canada,” said Doug DePhillips, Senior Executive Vice President – Global Services of J.S. Held. “This supports our continued focus on unparalleled service as we answer the...

Life insurance sales are stagnant, but profits are still being made. A new National Association of Insurance Commissioners’ working group is set to tackle accelerated underwriting with an Oct. 2 kickoff conference call. The group — aptly named the Accelerated Underwriting Working Group — is chaired by Robert H. Muriel, director of the Illinois Department of Insurance. Grace Arnold, deputy commissioner of insurance for Minnesota, serves as vice chair. The group was formed during the NAIC summer meeting in August. Its charge reads: “Consider the use of external data and data analytics in accelerated life underwriting, including consideration of the ongoing work of the Life Actuarial (A) Task Force on the issue and, if appropriate, drafting guidance for the states.” Accelerated underwriting is a topic of great interest in the life insurance industry. Consumers say that trimming the application time and the hurdles they need to clear would make them more receptive to life insurance. Insurers are responding accordingly. Annual Milliman surveys show a steadily increasing shift to accelerated underwriting. For example, Milliman found that 24.6% of indexed universal life sales were made with accelerated underwriting for the fiscal year ending Sept. 30, 2018. That figure is up from 16.8%...

Targeted News Service (Press Releases) Superintendent of Financial Services Linda A. Lacewell today announced that the Department of Financial Services (DFS) has fined American Progressive Life and Health Insurance Company of New York $260,000 for rescinding certain life insurance policies without the consent of policyholders. “American Progressive took the power of choice from consumers into their own hands – an unacceptable and illegal course of action,” said Superintendent Lacewell. “We expect insurers to play by the rules and the Department will take action to ensure they do.” A DFS investigation resulting from a consumer complaint found that from 2010 to 2019 American Progressive rescinded reduced paid-up life insurance policies with a cash value of $500 or less and paid the cash value to 260 policyholders without the consent of the policyholders, in violation of New York Insurance Law. The identified policies originally had a total face amount of $2,333,438 and total reduced paid-up death benefits of $32,945. Under today’s order, American Progressive will present a remediation for restitution plan to policyholders or their beneficiaries for each violation. Under the plan, American Progressive will identify policies that it rescinded without consent of the policyholders. The company will give those policyholders the...

Alethea Spiridon | September 18, 2019 Napoleon (Wolf Steel Ltd.) is rolling out a mental-health toolkit this week after seeking feedback from employees. The toolkit is the latest initiative in the fireplace manufacturer’s mental-health journey, which started in 2016 with the launch of its workplace wellness program which focuses on four pillars of health including work/life balance, mental health, physical fitness and nutrition. The focus on mental health began with training sessions for senior executives and leadership. “They first went through a training session in person and we provided them with webinars and did surveys to get their feedback,” says Stacy Mitchells, the organization’s benefits specialist. Read: Looking to create a mental-health strategy? Ask your employees first This was followed by a training seminar specifically for managers, which Napoleon used to learn where employees felt there were gaps and how they could be filled. They wanted answers on how to address mental-health issues and how to have those conversations with their teams. They were also interested in stress management tools and resources, supportive coaching, team-building exercises and understanding about their roles and responsibilities as leaders in supporting their team members’ overall mental well-being. “Then the fifth option they gave us was [the idea for] a toolkit, so [we] thought, well, a toolkit can really be built...

Staff | September 18, 2019 The New Brunswick Public Service Pension Plan saw a return of 1.75 per cent in 2018, yielding $132.3 million in additional net investment income, according to its annual report. The increase was led by private equity, which returned 26.91 per cent during the year. Other alternative investments, such as infrastructure and real estate, were also positive, returning 6.39 per cent and 10.93 per cent, respectively. For public equities, Canadian small cap returned 17.56 per cent, followed by large cap (8.75 per cent), U.S. equities (4.27 per cent) and international equities (6.65 per cent). Read: N.B. public service pension board awards cost of living increase The plan, which is managed by Vestcor Corp., is also providing its 39,000 members with a full cost of living adjustment for the seventh consecutive year. Based on the consumer price index, this year’s increase is 2.12 per cent. The decision was reached by Marilyn Quinn, the chair of the board of trustees, after she and the board reviewed the pension plan’s financial position, along with the results of a series of independent risk management tests as required by the plan’s funding policy to determine its financial health. “We are very pleased to once again provide the full cost of living...

The costs of employer medical benefits across the world are expected to rise 8% in 2020, outpacing general inflation by 4.9%. Costs in North America are forecasted to rise the same rate as last year at 6.4%, still more than inflation, according to the 2020 Global Medical Trend Rates Report released by Aon plc. The anticipated average global annual increase for employer-sponsored medical plans is expected to be in line with 2019, with a 0.2% increase in 2020, due mainly to the rise of chronic diseases, expanded benefits, and a slight increase anticipated in general inflation. “Rising medical costs and the prevalence of chronic conditions continue to be a focus of our clients around the world,” said John Zern, CEO of Global Health Solutions at Aon. “Providing our clients with market-leading solutions that enable consumer choice, promote transparency and enable wellbeing in order to drive better financial and colleague outcomes will continue to be a priority for us at Aon in 2020.” Aon’s survey found projected medical trend rates continue to vary significantly by region. Costs are expected to increase the most in Latin America and Middle East/Africa regions, with average medical premium rates forecasted at 13.1% and 12.2%, respectively....