France’s AXA sells insurance assets in Ukraine to Canada’s Fairfax

REUTERS

AXA Insurance and AXA Insurance Life will continue to operate and fulfill all their obligations without any changes.

French-based AXA Group, represented in Ukraine by AXA Insurance and AXA Life Insurance, has sold its Ukrainian assets to Canada’s Fairfax Financial Holding Limited. Read also A third of businesses expect Ukraine investment climate to improve – EBA “AXA Group has entered into an agreement with Fairfax Financial Holding Limited (Canada) to sell all its insurance operations in Ukraine. Under the terms of the agreement, Fairfax would acquire a 100% of the non-life entity (AXA Insurance) and the life entity (AXA Life Insurance) in Ukraine,” the company’s press service said on October 23. As reported,

AXA Insurance and AXA Insurance Life will continue to operate and fulfill all their obligations without any changes. “It’s time to make a step forward, which will open up new opportunities for the company and each of its clients. With the new owner, we won’t only keep our leading positions, but also continue to develop the entire Ukrainian insurance market,” the press service added.

The new owner’s headquarters is based in Toronto, Canada, it said, adding that it has been engaged in insurance and investment management since 1985. “The company is listed on the Toronto Stock Exchange (FFH: CN). Its market capitalization is estimated at $15.1 billion. The holding operates in 40 countries across the world,” the report said. UNIAN memo. AXA Insurance, which is the leading insurance company in Ukraine, has been operating since 2007. AXA Insurance started working in the Ukrainian market in July 2013.

 

As tech changes the insurance industry, what should investors look for?

In the past few years, some big changes have been unveiled in one of the world’s most traditional industries.

John Hancock, one of the oldest and largest North American life insurers, recently announced it will stop underwriting traditional life insurance. Instead, the 156-year-old insurer, owned by Canada’s Manulife Financial, will sell only interactive policies that track fitness and health data through wearable devices and smartphones.

Prudential Financial said it will go straight to consumers with its insurance and investment products for the first time in its 143-year history, offering products through its website rather than selling exclusively through its large network of advisers and employer-sponsored programs.

And Manulife recently announced it will contribute $400,000 to the Artificial Intelligence Institute at the University of Waterloo for research in disability claim prediction as well as fraud detection and language comprehension in customer service.

These developments in the past month are only a few examples of the sea change in the insurance industry, showing how established companies are turning to technology to find new ways to expand business in light of online startups and rivals that are challenging the established order.

Consulting firm Accenture says about two-thirds of insurers have begun using artificial intelligence-based “virtual assistants.”

“Millennials and other younger people have large purchasing power,” John Barnidge, a Sandler O’Neill analyst, told Reuters, adding that they do not value insurance agent relationships as much as previous generations.

So, what does this shift toward a growing demand for online sales mean for the bottom lines of insurance companies – and what are the best ways for investors to play the trend?

“I’ve frequently described the insurance industry as being behind the technology curve, but we’re seeing significant advances,” says Meyer Shields, managing director at investment firm Keefe, Bruyette and Woods in Baltimore.

As one example, he points to the use of increasingly sophisticated data analysis to vary price rates in personal auto insurance. Other examples include artificial intelligence applications to augment underwriting decisions, and the use of drones to evaluate insured property damage.

As far as specific companies leading the way in using these techniques, Mr. Shields singles out auto insurer Progressive (PGR-NYSE) as a leader in data analysis, with cutting-edge capabilities in data-driven insurance pricing. He says commercial insurers Travelers (TRV-NYSE) and The Hartford (HIG-N) are both very strong at utilizing technologies to improve outcomes in lines of business such as worker compensation. He also points to global insurer Chubb (CB-NYSE) for its advanced use of artificial intelligence and technology-based distribution.

Mr. Shields says his firm’s overall investment thesis for the insurance sector is that commercial casualty rates are likely to rise, while personal and commercial auto rate increases will decelerate, and property insurance rate increases will probably reverse course. As a result, he favours the commercial insurers that should see underwriting margin expansion in coming quarters – AIG (AIG-N) and The Hartford are the firm’s top picks in that space.

Keefe Bruyette also likes insurance brokers such as Arthur J. Gallagher (AJG-NYSE)and AON PLC (PLC-NYSE) as they expect rising rates combined with economic growth driving faster revenue growth, margin expansion and improving cash flows.

Canadian insurers are also taking a lead in this technology revolution. Manulife’s (MFC-TSX) move in this direction has caught the attention of Meny Grauman, head of institutional equity research at Cormark Securities in Toronto. He’s impressed with their push toward a ‘vitality’-based business.

As well, both Manulife and Sun Life (SU-TSX) rely on their Asian units for a significant part of their growth. Mr. Grauman considers that region as being more advanced in its use of technology in the insurance industry. He notes that in China it is possible now to buy life insurance and process claims over the popular WeChat messaging app. “That kind of thing doesn’t exist yet in North America,” he says.

While he appreciates the technological edge of Manulife and Sun Life, Mr. Grauman’s top pick in the sector is Industrial Alliance (IAG-TSX). He likes the Quebec-based insurer’s strong track record of performance, and the development of its wealth advisor and distribution networks. He feels the company is set to rebound from concerns over a chief executive officer transition and a couple of “not so strong” quarters. “It’s underappreciated,” he says.

The tech revolution in insurance has also caught the eye of Gordon Reid, president and CEO of Goodreid Investment Counsel in Toronto. Here in Canada, he notes Manulife’s plan to spend $1.5-billion on technology, with 30 per cent directed toward “changing the client experience.” He is impressed as well with Sun Life’s use of “nudges’ – that is, the process of using technology to encourage plan members to enrol in money-saving options. He also notes Great-West Life’s (GWO-TSX) use of its MPower division to allow other operators to outsource record keeping and administration.

In the United States, Mr. Reid points to the innovative work in the Optum division of United Health (UNH-NYSE). Optum bills itself as a “health-care intelligence” firm, using data, analytics and expertise to deliver services in the most effective ways possible. His top pick in the sector is Indianapolis-based insurer Anthem Inc. (ANTM-NYSE). His firm initially recommended the company’s shares for its client portfolios on a valuation basis, due to its low stock-price-to earnings ratio. “Today the theme is scale, and the resulting action has been industry consolidation,” he says.

He notes Anthem’s purchase of the hospice operator Aspire, Cigna’s purchase of Express Scripts and drugstore chain CVS buying insurer Aetna. “All of this is intended to vertically integrate, allowing more touchpoints with the patient,” he says. And while that can come in many forms, including face-to-face contact, new technologies are increasingly playing a key role.

Survey: Paying With Taps And Apps Leaves Some Feeling Disconnected From Their Money

With mobile apps on your smartphone, and tap-and-go debit and credit cards, it’s never been faster or easier to pay for things. This has led to some of us feeling disconnected from our money, according to new research commissioned by MARU in partnership with Tangerine Bank.

“Apps and taps for payment are becoming such a way of life that some Canadians feel they’re not as strongly connected to their money,” said Mark Nicholson, Vice President of Client Experience at Tangerine. “One in five (20 per cent) of our survey respondents, feel that way. And on top of the lost connection to money, a large majority of Canadians with a bank account – 71 per cent – wish they could save more money each month, and almost half (47 per cent) say they’re worried about their financial future.”

Younger Canadians are especially concerned, with 70 per cent of those age 18-24 saying they’re worried about their financial future (compared to a 46 per cent average for all other age groups). Thirty per cent of younger respondents, age 18-24, say they’re unsure that they’ll be able to pay off their debts, versus just 17.5 per cent among other age groups.

Among some of the other findings, the national survey found that only 37 per cent set a budget every month and stick to it. When asked where their monthly spending goes, respondents listed phone, internet, TV, transportation, utilities and rent as part of their monthly spending.

To help Canadians focus on saving and keep better track of their spending, Tangerine has introduced two new features on its mobile app and online banking: Goals and Left to SpendGoals lets users establish one or multiple savings priorities, like a vacation or a new car, set up regular contributions, and provides real-time updates on progress being made. Left to Spend monitors regular expenses like rent or mortgage payments, car payments, insurance etc., and calculates how much disposable income you have “left to spend” in each month or pay period.

“Debt remains an issue, with loan and debt payments taking the third largest chunk of monthly spending (20 per cent), after rent or mortgage payments and other types of spending such as groceries. So we think it’s more important than ever to offer features like Goals and Left to Spend to help Canadians better keep track of their everyday spending to help with their long term financial goals,” said Nicholson.

The survey found almost three-quarters of Canadians (71 per cent) use online banking to track their spending, with almost one-third (27 per cent) using mobile banking apps.

“Information is power, especially when it comes to managing spending and achieving savings goals,” said Brenda Rideout, President and CEO. “While technology makes it easier to spend than ever before, it also empowers Canadians to manage their money. These new features are designed to make it easier for Tangerine Clients to keep fully up to date on spending and saving.”

On a positive note, the survey found that Canadians are finding ways to save. According to the survey, four in ten Canadians save money most months, with a similar number saying they save money every single month. Typical monthly savings are up to $250, with retirement, emergencies and vacations making up the top three things Canadians are saving for.

ABOUT THE SURVEY
From August 31st to September 4th 2018 Maru/Blue executed an online survey of 1,000 randomly selected Canadian adults with an active bank account who are Maru Voice Canada panelists. Among them were respondents in the following age groups: 18-24 (n=33), 25-34 (n=222), 35-44 (n=176), 45-54 (n=233), and 55+ (n=336). For comparison purposes, a probability sample of this size has an estimated margin of error (which measures sampling variability) of +/- 3%, 19 times out of 20. Discrepancies in or between totals are due to rounding.

ABOUT TANGERINE BANK
Tangerine is a direct bank that delivers simplified everyday banking to Canadians. With over 2 million Clients and close to $38 billion in total assets, we are Canada’s leading direct bank. Tangerine offers banking that is flexible and accessible, products and services that are innovative, fair fees, and award-winning Client service. From no-fee daily chequing and high-interest savings accounts, a Credit Card, GICs, RSPs, TFSAs, mortgages and mutual funds through its subsidiary, Tangerine Investment Funds Ltd., Tangerine has the everyday banking products Canadians need. With over 1,000 employees in Canada, our presence extends beyond our website and Mobile Banking app to our Café locations, Pop-Up locations, Kiosks and 24/7 Contact Centres. Tangerine was launched as ING DIRECT Canada in 1997. In 2012 it was acquired by Scotiabank, and operates independently as a wholly-owned subsidiary.

Tangerine was recently selected as ‘Best of Show’ winner at the 2018 Finovate Fall Conference for their Left to Spend and Goals features. Finovate brings together more than 1,200 financial services professionals, investors and Fintech enthusiasts to celebrate the cream of the crop in the Fintech world.

SOURCE Tangerine

 

Canada Post strike averted for now as union says it will remain at bargaining table

Ottawa – The union representing thousands of Canada Post workers says it will stay at the bargaining table, averting a potential strike by mid-week.

The Canadian Union of Postal Workers said Monday it would not issue a 72-hour notice of job action, giving the Crown agency’s negotiators an opportunity to address the union’s demands, which include higher wages and better working conditions.

Both sides have been bargaining for separate collective agreements over the past nine months.

Negotiators were facing a Wednesday deadline of 12:01 a.m. eastern time for a possible strike or lockout after conciliated talks failed to reach a deal earlier this month.

While the two sides continue talking, the union warns its members may still face a work stoppage if there is no progress in bargaining.

A spokeswoman for Canada Post said Monday that both sides were working hard to reach negotiated agreements.

NAFTA talks: Like Mexico, Canada may need ‘insurance’ against tariffs

Canada maintains that its efforts to evade American tariffs on steel and aluminum, and threatened tariffs on cars, are on a “separate track” from the ongoing NAFTA talks.

But that’s not how U.S. President Donald Trump sees it. His attempts to use tariffs as leverage in NAFTA negotiations have become such a ingrained habit by this point, he’s started using the word as a verb.

“If countries will not make fair deals with us, they will be ‘Tariffed!'” he tweeted Monday.

China was in Trump’s sights at the start of the week — but by week’s end he also could be talking about Canada and his threat to impose “national security” tariffs of 20 to 25 per cent on its auto industry if it doesn’t soon join the new North American trade deal Americans sketched out with Mexico last month.

One of Trump’s loyal Congressional soldiers, House Majority Whip Steve Scalise, warned Tuesday that Congress would “consider its options” if Canada doesn’t sign on.

Foreign Affairs Minister Chrystia Freeland insists Canada won’t sign a bad deal.

“That’s not rhetoric,” she told reporters before she left again for Washington. Still, she said, Canadians have a “talent for compromise.”

I don’t think we’re going to get a NAFTA deal any time soon.– Monica de Bolle, senior fellow at Washington’s Peterson Institute for International Economics

Her negotiators face a tough call. Even if they strike deals and close the remaining chapters — by Thursday, Freeland’s Mexican counterpart suggested, if they’re going to have a text for Congress by the end of the month — a bigger question lurks.

Would a renegotiated NAFTA lift damaging steel and aluminum tariffs and shut down threats of future car tariffs? If it didn’t, why would Canada sign on?

Monica de Bolle, a senior fellow at Washington’s Peterson Institute for International Economics, said people have been too focused on specific sticking points — dairy concessions, dispute resolution chapters, intellectual property demands and more.

“The big picture is the threat of tariffs,” she said. “And not just the threat. The ones already in place.”

READ MORE HERE: 

CBC News

Mail disruptions possible by Sept. 26 if postal workers approve job action

By Terry Pedwell

THE CANADIAN PRESS

OTTAWA _ While postal workers waited Monday to find out whether they’ll be on picket lines later this month, some of Canada Post’s clients weren’t taking chances on whether there would be a strike or lockout at the Crown agency.

Members of the Canadian Union of Postal Workers, CUPW, wrapped up voting Sunday on a call by the union for a strike mandate after months of contract talks failed to produce a collective agreement. Results of two separate votes are expected to be released Tuesday.

But even before the final votes were cast, companies like Enbridge Gas Distribution Inc. were encouraging customers to register for online billing, noting that bills must still be paid, regardless of whether paper copies could be delivered to households.

If CUPW members voted in favour of job action, they could legally strike by Sept. 26 after a “cooling off” period, but Canada Post would also be legally able to lock them out on the same date.

Neither side has said it would take such action.

CUPW said it received wide-ranging contract offers on Friday that it called  “unacceptable.”

One offer covering urban employees included proposed wage increases of 1.5 per cent for each year of a four-year deal. The union said the offer also included what it described as “Trojan horse” language around job security.

Canada Post wants the ability to use temporary employees to cover vacancies, but for a potentially unlimited duration, the union said in a statement to its members Friday.

“There is no limit as to how long they could hold these vacancies and use temporary employees to cover these positions,” the statement said.

The urban offer would also reduce vacation time and eliminate pre-retirement leave for future employees, CUPW said.

The union said another offer to rural carriers would not settle key issues including job security and work hours.

“This offer does nothing to address the issues that are important to (rural carriers),” known as RSMCs, the statement said.

“True respect means full equality for RSMCs.”

Collective agreements governing working conditions for both sets of workers expired in December 2017.

Contract talks, aided by a third party conciliator, ramped up in early June and were moved to an undisclosed hotel in Ottawa.

A spokesman for Canada Post said the Crown agency would not comment on negotiations, except to say both sides were working hard to find common ground.

CUPW national president Mike Palecek warned early last month that union members should be prepared for  “some type of job action” if contract talks fail.

A pay equity dispute involving the carriers’ 8,000 rural and 42,000 urban workers was also at the heart of the negotiations.

Arbitrator Maureen Flynn criticized the pay discrepancies at Canada Post as  “fundamentally flawed” in a May ruling, in which she gave both sides until the end of August to reach a pay equity settlement.

That deadline has passed and Flynn is expected to impose a solution, although CUPW said there are other pay equity issues left to resolve outside of the arbitration process.

Canada Post, in issuing its second quarter financial statement last month, estimated that a settlement could saddle the agency with a one-time hit to its bottom line in the range of a quarter billion dollars.

The agency has recently seen a boom in its parcel distribution business while letter mail volumes have plummeted.

Among its demands at the bargaining table, CUPW also wants the Crown agency to bolster its line of services, including the return of postal banking to communities under-served by banks and other lending institutions.

Canada Post employees were last locked out in 2011, but were quickly legislated back to work by the previous Conservative government. In 2016, an Ontario judge ruled that legislation was unconstitutional.

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