Intact Financial Corporation strengthens its supply chain network with acquisition of On Side Restoration

Intact Financial Corporation (TSX:IFC) and On Side Developments Ltd., the parent company of On Side Restoration (“On Side Restoration“) today announced that they are joining forces to strengthen repair and restoration services for personal and commercial property claims customers across Canada. With this acquisition IFC will deepen its claims expertise and strengthen its supply chain network. The transaction is expected to close on or before October 1, 2019 subject to certain conditions, including regulatory approval.

On Side Restoration is a national restoration firm, based in Vancouver, with more than 1,200 employees and 35 branches coast to coast. Its reputation for excellent customer service along with 40 years of claims experience makes it a strong strategic fit for IFC.

“Our claims service is a key differentiator and is at the heart of what we promise. On Side Restoration is already an important part of our Rely Network of preferred vendors and they have a track record of providing excellent customer service and helping us deliver on that promise,” said Charles Brindamour, Chief Executive Officer, Intact Financial Corporation. “By taking ownership in the supply chain and combining our strengths we can ensure simpler, faster and consistently higher quality outcomes for property claims customers. This transaction will reduce claims handling costs and provide diversification to our property exposures with a new and counter cyclical earnings stream,” added Mr. Brindamour.

“With this agreement we are combining two leading companies who are keenly focused on providing the highest levels of professionalism, care, and exceptional customer service in property restoration,” said Craig Hogarth, Founder and President, On Side Restoration. “Becoming part of the Intact family is an exciting next step that will fuel another 40 years of growth as we continue to build our business and serve a wide variety of clients, including other key partners and insurers,” added Mr. Hogarth.

IFC has been steadily increasing collaboration over time with On Side Restoration to reduce cycle times and simplify processes for an improved customer experience. Through this acquisition IFC expects to further increase operational efficiencies and improve customer satisfaction by reducing the duplication of processes and controls, which will result in quick decision making and faster completion of repair and restoration work.

The property supply chain, namely restoration services, is a growing area of business, particularly as our communities are experiencing more frequent weather events. Intact will gain full ownership of On Side Restoration over a two-year period for a variable purchase consideration which is based in part on future profitability metrics. The purchase price will be financed from internal resources. The acquisition will provide immediate low single digit accretion to NOIPS, and mild accretion to ROE.

About On Side Restoration
On Side Restoration is one of the nation’s leading Canadian-owned restoration companies with 35 branches from Victoria, BC to St. John’s, Newfoundland. For the past 40 years the company has been restoring damaged homes and businesses 24 hours a day, 365 days a year. Proprietary internal systems include eClaim, a transparent web-based file management software program, and On Side LiVE, their 24 hour customizable emergency call centre. Experienced and certified crew operate On Side Restoration’s extensive fleet of emergency response vehicles and leverage their 13,000+ pieces of specialty equipment. Further information about On Side Restoration can be found at www.onside.ca.

About Intact Financial Corporation
Intact Financial Corporation (TSX: IFC) is the largest provider of property and casualty (P&C) insurance in Canada and a leading provider of specialty insurance in North America, with over $10 billion in total annual premiums. The Company has approximately 14,000 full- and part-time employees who serve more than five million personal, business and public-sector clients through offices in Canada and the U.S. In Canada, Intact distributes insurance under the Intact Insurance brand through a wide network of brokers, including its wholly-owned subsidiary BrokerLink, and directly to consumers through belairdirect. In the U.S., OneBeacon Insurance Group, a wholly-owned subsidiary, provides specialty insurance products through independent agencies, brokers, wholesalers and managing general agencies.

Forward Looking Statements
Certain statements included in this press release, including without limitation, the timing for completion of the proposed acquisition, management’s estimates and expectations in relation to resulting accretion, internal rate of return, net operating income per share, annual synergies, operational efficiencies and risk diversification are forward looking statements. The words “will”, “expected to” and comparable words or phrases are intended to identify forward looking statements. Forward looking statements are based on estimates and assumptions made by management in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes are appropriate in the circumstances.

Many factors could cause IFC’s actual results, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward looking statements, including without limitation, the terms and conditions of, and regulatory approvals relating to, the proposed acquisition, timing for completion of the proposed acquisition and various other actions to be taken or requirements to be met in connection with the proposed acquisition and the factors discussed in IFC’s most recently filed Annual Information Form and annual Management’s Discussion & Analysis. These factors are not intended to represent a complete list of the factors that could affect IFC. These factors should, however, be considered carefully.

All of the forward-looking statements included in this press release are qualified by these cautionary statements. Although the forward-looking statements are based upon what management believes to be reasonable assumptions, IFC cannot assure investors that actual results will be consistent with these forward-looking statements. When relying on forward-looking statements to make decisions, investors should ensure the preceding information is carefully considered. Undue reliance should not be placed on forward-looking statements made in this press release. Except as may be required by Canadian securities laws, we do not undertake any obligation to update or revise any forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise.

SOURCE Intact Financial Corporation

For further information: Media enquiries: Stephanie Sorensen, Director, External Communications, Intact Financial Corporation, 416-344-8027, stephanie.sorensen@intact.net; Sonia Manson, Communications Manager, On Side Restoration, 647-464-3092, media@onside.ca; Investor enquiries: Ken Anderson, Vice President, Investor Relations and Treasurer, Intact Financial Corporation, 855-646-8228, ext. 87383, kenneth.anderson@intact.net; Neil Seneviratne, Director, Investor Relations, Intact Financial Corporation, 416-341-1464 ext. 45156, neil.seneviratne@intact.net

Related Links

www.intactfc.com

Social insurance numbers are stolen by the millions

New SINs ‘will not protect individuals from fraud,’ said government official

Jonathon Gatehouse · CBC News

The one million Canadians who saw their social insurance numbers stolen in the massive Capital One data hack shouldn’t count on Ottawa to help bail them out of trouble with identity thieves.

In 2018, the federal government issued replacement SINs in just 60 cases of fraud and abuse, according to recent testimony before a House of Commons committee.

Elise Boisjoly, an assistant deputy minister with Employment and Social Development Canada, told the Commons standing committee on public safety and national security that her department handed out more than 1.6 million new social insurance numbers last year — but issued only a few dozen replacement numbers because “getting a new social insurance number will not protect individuals from fraud.”

“The former social insurance number continues to exist and is linked to the individual. If a fraudster uses someone else’s former social insurance number and their identity is not fully verified, credit lenders may still ask the victim of fraud to pay the debts,” Boisjoly said during a mid-July hearing on a data breach at the Quebec-based credit union Desjardins, which exposed the personal data of 2.7 million customers, including SINs.

Social insurance numbers are prized by criminals because they can be used to apply for credit under someone else’s name or establish new “synthesized” identities. They also can be sold to create false documentation for illegal workers.

While Boisjoly acknowledged the challenge posed by “ever larger data breaches,” she said issuing replacement numbers to victims might create more problems than it solves, leading to potential errors in the calculation of pensions and benefits and requiring recipients to monitor both the old and new SINs on a “regular and ongoing basis.”

Earlier this week, U.S.-based Capital One Financial Corp. disclosed that a March breach of its cloud storage server exposed the sensitive information of 100 million Americans and six million Canadians — including names, addresses, credit scores and, in some cases, social insurance numbers.

The information was taken from card holder accounts and credit applications dating back as far as 2005. A 33-year-old Seattle software engineer has been charged with computer fraud and abuse after she allegedly boasted of the heist on social media, indicating that she wanted to share the SINs, full names and dates of birth.

It’s just the latest example of a large-scale hack targeting the personal information of consumers.

READ MORE HERE: 

Private sector must drive better options in B.C.’s auto-insurance market

The excerpted article was written and updated by Colin Brown | Vancouver Sun

B.C. motorists are held hostage when it comes to basic vehicle insurance. That’s unfortunate, since rates in our province are among the highest in Canada. For instance, we pay considerably more for comparable insurance than our neighbours in Alberta.

Compounding our affordability woes, ICBC hiked basic rates in April to stem mounting financial losses. (We all remember the colourful words of Attorney-General David Eby, who described the corporation as a “financial dumpster fire”.) As a driver myself, any increase hurts the wallet. Plus, new drivers will pay even more when ICBC rolls out a new risk model in September.

We all want a better price. This is, after all, an infamously expensive place to live. A survey recently conducted by local pollsters Research Co. confirms what I have long suspected: More than three-quarters of British Columbians (78 per cent) want more choice in the auto insurance market.

The good news is that British Columbians do have a choice when it comes to optional insurance: the private sector. Private insurers have the potential to offer more choice, more savings and a better overall insurance experience.

But as ICBC works to regain traction, some optional insurance companies are being inconsistent in their offerings. Rather than being part of the solution, some chose to go dormant — hiding out during this time of uncertainty. In fact, there was a period last summer when two of the biggest providers in our market were not writing new policies because market conditions weren’t favourable.

But we don’t just need competition, we need better competition. Unfortunately, some optional providers have little knowledge of our market — making it difficult to tailor products to our west coast lifestyle. And we know for a fact that drivers do want a better product: The majority polled indicate a desire for better optional vehicle coverage (71 per cent), and a better product overall (67 per cent).

That’s where a gap currently exists. To be attractive to consumers, the private sector should help motorists save money by offering discounts for progressive consumer choices like energy-efficient vehicles, or technologically advanced safety features like automatic braking systems and lane departure warnings. The private sector would also do well to fill the current gap in niche coverage that includes luxury, recreational, collector and fleet vehicles.

While ICBC conducts test after test to evaluate new technologies, the private sector has an opportunity to lead the charge by rewarding new drivers who choose to use smart-phone monitoring solutions, or by offering discounts for using voluntary distracted driving apps. (And they should avoid the temptation to simply punish less-than-perfect drivers with surcharges.) The crown corporation unfortunately lags behind in offering these forward-thinking innovations, which could save consumers money while making the roads safer for everyone. Surely, offering incentives to prevent accidents is preferable to merely adding punitive surcharges after the fact?

So, as we look forward to smoother roads ahead, let this be a challenge to the private sector: drivers deserve better choices for optional coverage. Ideally, some of those intelligent options will come from homegrown, B.C. companies that know our market.

I’ll leave you with a sneak peek at what’s on the horizon: Remember Canadian Direct Insurance? I was proud to be part of its executive leadership team, prior to its acquisition. That local leadership team plans to continue the mission to bring more choice, more savings and a better insurance experience to B.C. motorists under a new corporate banner.

As a fellow driver, I believe British Columbians deserve better. Stay tuned.

With more than 40 years of experience in B.C.’s insurance sector, Colin Brown helped establish the operational framework for ICBC, before serving as its chief underwriter in the 1990s. He then served as Canadian Direct Insurance’s chief operating officer until the company’s acquisition in 2015.

Source: Vancouver Sun

Apollo Insurance Solutions Recruits Insurance Industry Veteran Victor Lange

Vancouver, BC, July 24, 2019 (GLOBE NEWSWIRE) — Victor Lange has officially joined Apollo Insurance Solutions Ltd. (“Apollo”) as Chief Operating Officer, bringing with him over 20 years of industry experience to the nascent insurtech industry. Lange has worked with Canada’s largest insurance company, Intact Insurance, and as COO of one of western Canada’s largest privately held commercial insurance brokerages, Wilson M. Beck. The significant executive move further signals a shift in the focus of insurance experts, away from organizations who foster traditional lengthy insurance processes and toward forward-thinking organizations who are focused on providing fast, convenient digital solutions of the future.

“Victor is a powerhouse in the insurance industry, and his leadership and insight will be extremely valuable in keeping Apollo at the forefront of the digital insurance space race,” says Apollo Co-Founder and CEO, Jeff McCann. “This appointment is where global insurance experience meets a nimble insurtech startup. Victor’s track record of leading high performing teams will be critical not only to our continued growth, but to our team’s ability to dial in Apollo’s sophisticated operations and accelerate our impact on this new, digital frontier.”

Victor will be joining Apollo at its Vancouver head office where he will oversee all company operations and work in lockstep with Co-Founder and CEO, Jeff McCann, as the company continues to rapidly onboard insurance brokers and successfully roll out new insurance products from multiple insurance carriers onto the Apollo Exchange.

“I’m excited to step into this role to take Apollo’s progress to the next level,” says Lange. “I identify strongly with Apollo’s entrepreneurial spirit and believe in Apollo’s vision to revolutionize this industry. This is a challenge we intend to win.” In addition to Intact Insurance and Wilson M. Beck, Lange’s resume also includes over a decade of senior management experience with international firms such as Zurich, AXA, and JLT.

Apollo Insurance is Canada’s largest online insurance marketplace. Apollo empowers the broker channel with its proprietary Exchange platform that enables brokers to instantly quote, bind, and issue policy documents for hundreds of classes of small business. Brokers using the Apollo Exchange platform are able to respond to the changing expectations of buyers and young employees.

About Apollo Insurance Solutions

Headquartered in Vancouver’s Gastown neighbourhood, Apollo Insurance Solutions is Canada’s largest online insurance marketplace. Co-founded by Jeff McCann, David Dyck, Justin Hamade, and Drew Green, Apollo was created to empower brokers to better serve small businesses by giving them 24/7 access to digital insurance.

Apollo Exchange offers Canada’s brokers access to multiple insurance providers, with over 500 classes of insurance. Unlike the traditionally lengthy insurance policy and application process – which can take up to six weeks – Apollo users can quote, pay, and have their policy documents issued online in just under five minutes, allowing them to focus on the important stuff: building trusted relationships and offering strategic, thoughtful counsel.

Following the completion of its Beta testing in April 2019, Apollo successfully closed its angel round of funding, raising $1 million CAD with the support of notable investors, including Drew Green, Matias Marquez, Kim Kaplan, and Caliber Ventures. Acting members of Apollo’s Board of Directors are leading industry and entrepreneurial figures Drew Green, Steve Albiani, Tim Gamble, and Jeff McCann. In June 2019, the company launched a first of its kind, digital, monthly subscription service. For more information, visit: http://story.apollocover.com

Online Distribution Of Insurance: A New Framework For Québec

Article by Catherine Jenner, Stuart Carruthers, Fabian Firas Bargout and Andrew S. Cunningham

On June 13, 2019, the main provisions of the new Québec Insurers Act and amendments to the Act respecting the distribution of financial products and services (“Financial Products Act”) came into force. Among other things, these provisions set out the regulatory requirements for insurers and insurance intermediaries selling insurance online in Québec (online insurance has been sold in Québec for many years, but without formal regulation).1

The finalized Regulation respecting Alternative Distribution Methods (“Online Insurance Regulation”) sets out details of the new obligations on insurers and insurance intermediaries. The draft regulation (“Draft Regulation”) that was published in 2018 has undergone a number of changes in response to industry comments.

Insurers and insurance intermediaries have until June 2020 to comply with certain of their new obligations as set out below.

Framework for the Sale of Online Insurance

The Online Insurance Regulation regulates:

  • online offers of insurance by intermediaries and insurers registered as a firm under the Financial Products Act (intermediaries and such registered insurers, collectively, “Firms”) without the intermediary of a natural person; and
  • offers of insurance through a distributor.

The finalized regulation (taken together with the AMF’s commentary on it) excludes non-transactional websites, such as most websites that facilitate comparison shopping, unless, in consideration of a commission or any other remuneration, such websites redirect users to a Firm’s website to conclude an insurance policy. [s. 2; Financial Products Act, s. 71, para. 3] This exception was absent from the Draft Regulation.

Disclosures to the AMF

Initially, Firms must disclose certain information about their website and the products offered on it to Québec’s insurance regulator, the Autorité des marchés financiers (“AMF”). [s. 4] Firms are also required to make annual disclosures with respect to the:

  • Amount of premium written;
  • Number of policies issued;
  • Number of financial plans prepared;
  • Number of claims settled; and
  • How often clients cancelled their policies within the 10-day period provided for by s. 64 of the Insurers Act. [s. 5]

Disclosures to clients

The final Online Insurance Regulation makes several changes to a Firm’s disclosure obligations, including:

  • Firms are required to ensure that the means to interact with one of its representatives (e.g., a chatbox) is visible at all times [s. 8, para. 1]; and
  • Firms are required to inform the client about his/her right of rescission or cancellation and the procedures for exercising it after the conclusion of the contract, not before. [s. 12, paras 1(3), 2]

Website

The Online Insurance Regulation also contains provisions relating to the design, operation and monitoring of Firms’ websites. The Regulation makes the following notable changes:

  • The scope of a Firm’s confidentiality and security obligations is broadened with respect to the storage of clients’ information as well as its collection, use, and delivery; [s. 13, para. 3]
  • Firms are required to interrupt offers of insurance of persons that are likely replacing other contracts where the replacement cannot proceed through the website in accordance with s. 22 of the Regulation respecting the pursuit of activities as a representative; and [s. 14, para. 2]
  • Firms are required to suspend proposals for insurance of persons where no representative can immediately interact with a client who has asked to interact with a representative and where there is a risk that the client, despite the information that the Firm sent to him or her, is unable to make an informed decision. [s. 14, para. 3]

Related advertising permitted

In a significant change from the Draft Regulation, the finalized Online Insurance Regulation does not prohibit advertising when the client is in the process of completing his application, unless it is “unrelated to the product or service”. While the AMF had previously argued for an outright prohibition, the government appears to have accepted industry submissions that related advertising could provide valuable information to a customer. [s. 18(1)]

Offers Through a Distributor

With respect to the distribution method of offering insurance, the Online Insurance Regulation modifies the obligations of both insurers and distributors.

Medical/lifestyle information

With respect to the collection by distributors of a client’s medical or lifestyle-related personal information, the finalized Online Insurance Regulation requires the distributor to deliver a notice of specific consent to the client, but only if the distributor wishes to use the information for purposes other than those for which it was collected. [s. 25] The Draft Regulation included a broader notice requirement.

Disclosure to the AMF

Insurers must disclose to the AMF information that is similar to what must be disclosed in the case of online insurance (see above):

  • Amount of premium written;
  • Number of insurance policies and certificates issued;
  • Number of claims and amount of indemnities paid;
  • Number of rescissions and cancellations; and
  • Remuneration paid to distributors and third parties. [s. 21]

If an insurer removes a distributor from its distributors’ list, it must inform the AMF of the reason. [s. 20, para. 3] One other change from the Draft Regulation is that insurers will be given 30 days to disclose any changes in their initial disclosure. [s. 20, para. 2]

Disclosure to clients

The Online Insurance Regulation requires insurers to require distributors to deliver a product summary at the time they offer the product to clients, together with a fact sheet in a form prescribed by the Online Insurance Regulation. The fact sheet is a document prepared by the AMF that lists relevant consumer rights, whereas the summary is a concise document that is prepared by the insurer to explain its product, both broadly and through such specific information as the product coverage, exclusions, and limitations. [ss. 22, 28–29, Sched. 2] A summary and a specimen of an insurance product policy should be available on the insurer’s website if the product is offered by distributors. [s. 32]

Monitoring

As part of insurers’ obligation to supervise and monitor their distributors’ offering of products, insurers are required to adopt and implement procedures to supervise and train distributors and their representatives [s. 33]. These procedures may be helpful because insurers are liable for any acts of distributors or their representatives in connection with underwriting an insurance policy or enrolling a participant [Insurers Act s. 65].

Prohibitions

Finally, the Online Insurance Regulation establishes several prohibitions relating to how insurers pay distributors, including a prohibition on profit-sharing and bonuses. [s. 35(2)]

Next Steps: Effective Date and Transitional Provisions

The Online Insurance Regulation came into force on June 13, 2019, with the exception of certain provisions that will not take effect until June 13, 2020. These include the requirements:

  • to make readily accessible on their websites a specimen of the policy for each offered product and any available endorsement, if applicable;
  • to adopt and implement a procedure regarding the design, use, and maintenance of their websites and regarding the management and mitigation of risks; and
  • to adopt and implement procedures to supervise and train distributors and their representatives.

In addition, until June 13, 2020, the insurer’s new obligation to deliver a summary and a fact sheet to distributors is deemed to be satisfied by delivering to clients a distribution guide that was provided to the AMF before June 13, 2019 in accordance with the requirement that existed prior to the coming into force of the new regime.

Footnotes

1. The amendments also set out rules for offering financial planning and claims adjustment services online which will not be summarized here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Source: Mondaq

Judge rules employees can speak to media about human rights abuses; Allstate says it might appeal ruling

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