Great West selling U.S. individual life insurance and annuity business for $1.6B

By Armina Ligaya

THE CANADIAN PRESS

Great-West Lifeco Inc. has signed a deal to sell its U.S. individual life insurance and annuity business to a subsidiary of Protective Life Corp. for $1.6 billion, which is below the unit’s value on the Manitoba-based insurer’s books.

The deal will allow the company to focus on the retirement and asset management markets in the United States, said Great-West’s chief executive Paul Mahon.

“We continually evaluate capital deployment opportunities at Great-West Lifeco,” he said in a statement on Thursday. “With the strengthened capital position resulting from this transaction, we will also consider other capital management activities, including potential share repurchases, to mitigate the earnings impact of the sale.”

The business that Protective Life, a wholly-owned subsidiary of Dai-ichi Life Holdings Inc., will acquire includes bank-owned and corporate-owned life insurance, single premium life insurance, individual annuities, and closed block life insurance and annuities. Great-West Life & Annuity will retain a block of participating policies, which will be administered by Protective, the companies said.

The business contributed about $120 million to its net earnings for the first three quarters of 2018, Great-West said. But the insurer expects to recognize a closing book value loss of about $93 million and transaction costs of $76 million.

Great-West’s shares were down more than four per cent in midday trading on the Toronto Stock Exchange to $28.03.

The transaction is expected to close in the first half of this year, subject to regulatory and customary closing conditions.

“This business aligns well with our long-term plans for growth and scale,” said Protective’s chief executive Richard J. Bielen.  “The life and annuity business has been a cornerstone of Protective throughout our history and will continue to be an area of future growth for the company.”

The deal also raises questions about whether Great-West’s next strategic move would involve Putnam Investments, its U.S. global asset manager and retirement plan provider, said National Bank of Canada Financial Markets analyst Gabriel Dechaine.

The transaction Great-West Life announced Thursday has strategic rationale, but Great-West isn’t in dire need of a cash infusion, he said in a note to clients. The $1.6 billion of deployable cash from Great-West’s sale of its U.S. individual life insurance and annuity business will be added to the insurer’s existing excess capital of $3.6 billion, and a debt capacity of $3 billion and holding company cash of $900 million, Dechaine added.

“As such, we believe the sale of non-core U.S. assets will raise expectations that an M&A transaction involving Putnam is imminent.”

Study finds more than half of food produced in Canada wasted

By Bob Weber

THE CANADIAN PRESS

More than half the food produced in Canada is wasted and the average kitchen tosses out hundreds of dollars worth of edibles every year, says a study researchers are calling the first of its kind.

“It’s a lot of food,” said Lori Nikkel of Second Harvest, the Toronto-based group working to reduce food waste that commissioned the study.

“We waste more food than we consume.”

The study released Thursday is the world’s first to measure food waste using data from industry and other sources instead of estimates, said Martin Gooch of Value Chain Management International, which conducted the study.

Value Chain works with agriculture, aquaculture, marine and food industries to make them more profitable.

“What we did was actually go to industry and (said), ‘Give us primary data,”’ Gooch said.  “This is the first time anywhere in the world that anyone’s gone out and got primary data that connects production with consumers.”

Results were checked with industry experts.

“At every point in the process, we ground-truthed it,” said Gooch.  “We’re confident our results are conservative.”

Previous work has suggested that Canadians waste almost 400 kilograms of food per person, one of the world’s highest totals. The new work adds considerable detail to that figure.

Apples rot in the grass for lack of harvest workers. Surplus milk is flushed. Thousands of hectares of produce are plowed after cancelled orders.

The report, funded largely by the Walmart Foundation, concludes 58 per cent of Canadian food production is wasted.

That includes unavoidable waste such as animal bones. But a solid one-third of the waste  more than 11 million tonnes could be recovered.

The report says the value of usable groceries that wind up in landfills or other disposal sites is almost $50 billion. That’s more than half the amount Canadians spend on food every year and is enough to feed every Canadian for five months.

As well, it says avoidable food waste in Canada produces more than 22 million tonnes of climate-changing carbon dioxide emissions.

The report says processing and manufacturing are the largest sources of avoidable waste, accounting for 43 per cent of it. Produce that doesn’t meet exacting grading standards, inaccurate market forecasts and inefficient processes are all part of the problem.

So are date codes which remove perfectly healthy food from the market.

“Best-before doesn’t mean awful-after,” said Nikkel.

Canadian kitchens are also conspicuous wastrels, responsible for 21 per cent of avoidable waste. That’s about $1,700 per household in a country in which four million people struggle for regular meals.

Hospitals, restaurants and institutions contribute 13 per cent of avoidable food waste. Retail outlets are close behind at 12 per cent.

Farmers waste only six per cent of the usable food they produce. Distributors waste even less at five per cent.

The report details many ways waste could be cut. Better co-ordination between farmer and processor, changes to crop insurance, clearer date codes, improved safety assessments for donated food and liability reform could all help keep nutrition out of the garbage and on somebody’s plate.

Even avoiding bulk buys that result in excess being tossed away would help, said Nikkel.

Canadians should change their attitude toward food, she added.

“We’ve cheapened it so much that it doesn’t have value any more. It would horrify our grandparents.

Alarms.org ~ Winter Driving Safety

Few are off the hook when it comes to dangerous winter driving conditions: according to the Federal Highway Administration, 70% of the United States’ roads are in areas that receive 5 or more inches of snowfall a year. What’s more, during the coldest months, well over 100,000 people are injured annually in crashes on icy or snowy roads. Follow these tips (and feel free to share the infographic below) to keep you, your family, and your car safe.

 

Ready your vehicle for winter weather​

  • Get a tune up. Make sure everything in your vehicle is in working condition: ignition, battery, transmission brakes, spark plugs, filters, fan belts, etc.
  • Keep your tires inflated. Because of low temperatures and icy roads, you run a heightened risk of flats. Adequate tire pressure will help prevent them.
  • Top up your fluids. Your vehicle should always be flush with oil, antifreeze, and especially, windshield wiper fluid.
  • Use the right tires. If you live in a hilly region where road conditions are unpredictable, installing winter tires with added traction may be necessary.

Make sure to store the essentials

  • Things to keep you warm. Keep blankets, boots, and cold weather clothes in your trunk in case of a breakdown.
  • Flashlights and flares. Use these tools to alert other motorists of your presence in case of an emergency. Matches and extra batteries for the flashlights are a good idea, too.
  • A fully-inflated spare tire, tripod jack and wrench. These should always be in your car if you get a flat, but in winter the need is especially immediate.
  • Tools to keep the snow at bay. Don’t leave home without your ice scraper and snow brush. You really won’t want to have to use your hands.

Know how to drive in snowy conditions

  • Maintain an increased stopping distance. With the added risk of slides and spinouts, stay farther away from other vehicles than you would during other seasons: around 8 seconds between your car and others.
  • Handle hills correctly. Don’t flood the gas at the crest of a hill, let your inertia bring you to the top. Never stop mid-way up a hill.
  • Don’t brake too quickly or forcefully. This will cause you to lose traction and cause steering wheel lockup.
  • Accelerate slowly. Hitting the gas when the road is slippery will cause you to skid and lose control. Ease into every acceleration.

Know how to handle a snow drift or breaking down

  • Don’t run the engine. Tempting to keep warm in frigid weather, but if your exhaust pipe is clogged, you run the risk of carbon monoxide poisoning.
  • Don’t try to push your car out of the snow. This could lead to overexertion or worse, the car might drift in your direction.
  • Stay in your car. The nearest gas station may not seem far, but if weather conditions shift, just ten minutes outdoors could lead to exposure. Call for help, ignite a flare, or tie a bright colored cloth on your antenna to indicate you are in need of help.

winter driving safety infographic

Scotiabank sells pension and insurance business in Dominican Republic

TORONTO _ Scotiabank has signed a deal to sell its pension and related insurance businesses in the Dominican Republic.

The Canadian bank says it will sell Scotia Crecer AFP and Scotia Seguros to Grupo Rizek.

Financial terms of the deal were not immediately available, but Scotiabank says the transaction is not financially material to the bank.

Grupo Rizek is a diversified business group in the Dominican Republic.

The deal is subject to regulatory approvals and customary closing conditions.

The sale follows an announcement last month by Scotiabank that it was selling its banking operations in nine Caribbean countries and its insurance operations in Jamaica and Trinidad and Tobago.

New Course for RIBO Ethics CE Requirement

New Course for RIBO Ethics CE Requirement

RIBO Ethics CE Requirement

The new license year of Oct 01, 2018 to September 30, 2019, brings new continuing education requirements for general insurance licensed individuals in Ontario.

The total number of required CE hours has not changed however a new category, Ethics, has been introduced and licensees must complete a minimum of 1 hour in this category per term.

ILScorp has developed a course that is RIBO approved for 1 CE in the new Ethics Category: Making the Right Ethical Decisions. This course is now available to all ILScorp General CE Subscribers!

More Info

In this course, we will look at the following topics as they relate to “Ethics and the

Insurance Professional”, specifically:

  • Defining “Ethics”
  • Establishing Ethical Standards – Sources of Influence
  • Basic Ethical Values and What They Really Mean
  • The Insurance Broker’s Dilemma
  • What a Formal Ethics Program Will Do For Your Brokerage

Along with the new Ethics CE requirement, there is also a cap on the number of Personal Skills hours permitted and a minimum number of Technical hours required. Continuing Education Requirements are listed below. 

RIBO CE Requirements

Principal Brokers and Deputy Principal Brokers

10 hours of continuing education credits every year between October 1st and September 30th subject to the following conditions:

  • minimum of 1 hour Ethics
  • minimum of 5 hours Management
  • Personal Skills category courses cannot be applied
  • The remaining hours may be in the Management or Technical categories.

A carryover of a maximum of 10 hours (or one term’s requirements) is permitted however the minimum category requirements must be maintained.

All other licensed individuals

8 hours of continuing education credits every year between October 1st and September 30th subject to the following conditions:

  • minimum of 1 hour Ethics
  • minimum of 3 hours Technical
  • maximum of 2 hours Personal Skills may be applied

A carryover of a maximum of 8 hours (or one term’s requirements) is permitted however the minimum category requirements must be maintained.

Newly licensed individuals

The continuing education program of 8 hours every year between October 1st and September 30th will begin the first October following registration. Individuals are only exempted for the remainder of the license year that they were registered.

E.g. Broker A was registered on November 1, 2017 and Broker B was registered on April 30, 2018. Neither Broker A, nor Broker B will be required to have accumulated any continuing education credits by September 30, 2018, but must begin taking the continuing education seminars/courses on October 1, 2018 for the 2018/2019 license term.

Potato shortage looms due to ‘harvest from hell’ after unseasonable weather

By Aleksandra Sagan

THE CANADIAN PRESS

Farmers across Canada left thousands of acres of potato crops unharvested after a slew of bad weather created challenging conditions, setting the stage for a possible shortage of the starchy dinner table staple.

“It’s unprecedented. Never, never before have I seen this in my time,” said Kevin MacIsaac, general manager of the United Potato Growers of Canada (UPGC), an organization that provides industry information to help farmers make production and marketing decisions. He’s been with the organization for seven years and, before that, grew potatoes in Prince Edward Island, where he still lives.

In typical years, one area of the country may suffer from a bad harvest, while others do OK, he said, but this year, the problems span almost all the way across the country.

Farmers abandoned about 16,000 acres of potato crop, according to the group’s most recent estimate, which did not include figures for Saskatchewan, Ontario or Nova Scotia, but indicated they also suffered some losses. B.C. is the only province that did not mention abandoned crops in UPGC’s report.

The group expects to have more precise figures soon, MacIsaac said, but is working with the best information it has now.

P.E.I., the country’s largest potato producer, suffered the most.

Farmers left about 6,800 acres unharvested. In a typical year, some 500 to 1,000 acres may be abandoned, said Greg Donald, general manager of the Prince Edward Island Potato Board, which represents the province’s nearly 170 growers.

The weather this year in the province was relentless.

First came a lacklustre growing season, with a late spring and hot, dry summer, said Donald, which was followed by an early frost in September that killed any future growth potential.

Then came copious amounts of rain, which delayed the end of harvest beyond the usual Halloween target date, and farmers pushed into November.

In early November, it rained one day and the ground froze solid the next, he said, meaning farmers could no longer dig for potatoes.

“Many have described it as the harvest from hell,” he said.

Unusual weather caused other provinces to suffer similar setbacks.

In Manitoba, some 5,200 acres remain unharvested, according to UPGC. While the province’s prospects for a good yield were strong going into harvest, rainfall followed by a cold spell resulted in thousands of abandoned acres, said MacIsaac.

Most farmers will have some type of insurance to cover a portion of their costs associated with the lost income, but it won’t cover the profit they would have made, he said.

The thousands of unharvested acres could mean a shortage of processing potatoes (those used to make products like french fries and hash browns) and table potatoes (those sold whole in grocery stores), both men said.

‘It’s going to be a real, you know, challenge,” said Donald, adding there’s not going to be enough local supply for the markets the province typically serves.

Compounding the problem is a similar situation in parts of the U.S., as well as parts of Europe where a dry season hurt yields, making for a more global shortfall.

While some growing areas in North America may have a shortage, others will have a surplus that can balance that out, said Terence Hochstein, executive director of the Potato Growers of Alberta.

His province abandoned about 1,000 acres, he said, which is more than he’d like, but pretty typical. It was able to send some potatoes to P.E.I. and Alberta to help, he said.

“Overall, I think the crop is going to be tight, but I think the industry will be alright.”

Still, consumers could ultimately see price hikes on potato products due to basic supply and demand principles.

When there’s less of a product, it’s going to be reflected in the price, Donald said, adding even the potatoes that have been harvested are not quite safe yet.

Potatoes are mostly water and harvesting them in wet conditions adds the risk of bringing extra moisture into storage, making them more difficult to dry and keep, he said.

“So that’s still a big concern as well.”

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