Economical Insurance completes acquisition of Canada’s largest pet insurer

Economical Mutual Insurance Company, one of Canada’s leading property and casualty insurance companies, announced January 3, 2017 the completion of its previously announced acquisition of Western Financial Insurance Company (WFIC) and its flagship brand Petsecure from Desjardins Group.

Concurrent with the acquisition, WFIC changed its legal name to Petline Insurance Company (Petline). The brand name Petsecure remains the same.

Bringing the market leader in the growing Canadian pet insurance industry into the Economical family of companies is consistent with the strategy of Economical and its focus on profitable growth, both organic and by acquisition. With net written premiums exceeding $50 million in 2015, Petline provides Canadian pet owners with comprehensive, veterinarian-recommended coverage for dogs and cats.

Petline will remain headquartered in Winnipeg, ensuring consistency of service in maintaining its industry-leading products, sales force, customer experience and relationships with veterinarians, shelters and breeders.

“This transaction is a step in our growth plan, which includes increasing scale and diversification through acquisitions,” said Rowan Saunders, President and CEO of Economical Insurance.

9 questions Canadians should ask their tax advisors before the end of 2016

As the year draws to an end, it’s the perfect time to be proactive about tax planning. According to EY’s Asking better year-end tax planning questions, asking your tax advisor better questions today can help identify real tax savings opportunities – before it comes time to complete tax returns in April.

“As tax rules become more complex, it’s even more critical to think of the bigger tax picture continuously throughout the year, as well as from year to year as your personal circumstances change,” says Bruce Sprague, Tax Partner with EY’s Private Client Services practice. “No one likes year-end surprises. Having a conversation with your tax advisor about optimizing your tax savings can yield financial benefits into 2017 and beyond.”

Sprague explains: “Reviewing estate planning goals and wills on a regular basis, for example, can protect your assets and provide tax-efficient income before and after your retirement, as well as a tax-efficient transfer of your wealth to the next generation.”

EY suggests considering how to approach current year-end planning with an eye to the future. Here are EY’s top 9 questions Canadians should ask their tax advisors before the end of 2016:

  1. Are there any income-splitting techniques available to me?
    Determine if you can take advantage of differences in tax brackets and marginal rates in your family with income-splitting loans, reasonable salaries to family members or spousal RRSPs.
  2. Have I paid my 2016 tax-deductible or tax-creditable expenses yet?
    There are a variety of expenses, including interest and child-care costs that can only be claimed as deductions in a tax return if the amounts are paid by the end of the calendar year. You’ll want to check on expenditures that give rise to tax credits and consider if the deduction or credit is worth more to you this year or next.
  3. Have I considered the impact of any changes to personal tax rules that are effective for the year?
    As a result of 2016 changes announced by the Federal government, if you have sold a principal residence in 2016 or hold any linked notes that are maturing after 2016, you may be subject to the new rules and should discuss the impact with your tax advisor.
  4. Have I maximized my tax-sheltered investments by contributing to a TFSA or an RRSP? 
    Make your TFSA and RRSP contributions for 2016 and catch up on prior non-contributory years. In order to maximize tax-free earnings, consider making your 2017 contributions in January.
  5. Have I maximized my education savings by contributing to an RESP for my child or grandchild?
    Make registered education savings plan (RESP) contributions for your child or grandchild before the end of the year. With a contribution of $2,500 per child under age 18, the federal government will contribute a grant (CESG) of $500 annually.
  6. Is there a way to reduce or eliminate my non-deductible interest?
    Interest on funds borrowed for personal purposes is not deductible. Where possible, consider using available cash to repay personal debt before repaying loans for investment or business purposes on which interest may be deductible.
  7. Have I reviewed my investment portfolio?
    Consider if you have any accrued losses to use against realized gains and determine if you have realized losses to carry forward.
  8. Can I improve the cash flow impact of my income taxes?
    Determine if you’re eligible to request reduced source deductions and see if you’re required to make a 15 December instalment payment.
  9. Have I thought about my estate planning?
    End of the year presents the perfect time to review and update your will and consider if there are changes to your life insurance needs. It may be the right time to consider an estate freeze to minimize tax on death and/or probate fees. Developing a comprehensive succession plan can help you pass the benefit of your assets to the right people at the right time.

To read EY tax insights and tips, visit ey.com/ca/taxmatters. To learn more about how EY works with private companies, visit ey.com/ca/private.

About EY
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

For more information, please visit ey.com/ca. Follow us on Twitter @EYCanada.

EY refers to the global organization and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

SOURCE EY (Ernst & Young)

Here are H&R Block’s top five tips to help prepare for the upcoming tax season.

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American consumers would be hurt by lumber duties, say U.S. housing groups

By Ross Marowits

THE CANADIAN PRESS

MONTREAL _ The imposition of import tariffs on Canadian softwood lumber will place a heavy burden on consumers and U.S. workers, a leading American voice for free trade with Canada says.

The U.S. National Association of Home Builders says duties or volume caps on imported lumber will raise the price of lumber, adding more than $1,300 to the cost of a new single family home.

It also forecasts higher lumber prices will result in a net loss of almost 8,000 jobs if 25 per cent of duties are imposed on Canadian lumber flowing into the U.S. About US$450 million in wages would be lost along with US$320 million in government taxes.

The impact would mainly be felt by the construction industry, but also hit other sectors including mattress firms that use Canadian lumber in bed frames, transportation, finance, insurance and real estate.

Increased lumber prices along with higher interest rates would make new homes less affordable for average consumers. The association, which this year formed the American Alliance of Lumber Consumers, claims that about 153,000 households would no longer qualify for average mortgages with every US$1,000 increase the home prices.

That would hamper the U.S. housing recovery which is slowing improving since the 2008 financial crisis, says Paul Emrath, vice-president survey and housing policy research at the home builder association.

“It’s one of the roadblocks and obstacles we’re trying to overcome to get back to what should be a long and sustainable rate of production,” he said in an interview.

Last week, the U.S. Lumber Coalition petitioned the U.S. Department of Commerce and the U.S. International Trade Commission to impose duties to offset the harm to U.S. mills, workers and communities by what it claims is subsidized Canadian softwood lumber.

The coalition accused the builders of conducting a “highly flawed analysis” to reach its forecast, adding that forestry sector jobs are at risk.

“Insisting on fairness in trade would create more jobs in this sector that would support and strengthen thousands of American communities across the country,” it wrote in an email.

Canadian producers dispute the coalition’s claims of unfair trade, saying similar assertions were rejected by independent NAFTA panels in the prior round of trade litigation.

Industry analysts expect that following an investigation, the U.S. government will impose preliminary duties next April of between 25 and 40 per cent.

While the home builders oppose the lumber coalition, they are not big fans of the Canadian government’s negotiating tactics or the 2006 softwood agreement that has expired. It favours free trade, not the managed system in the prior deal that imposed export taxes if the price of lumber went below a certain amount.

“We feel strongly that Canada should have had a more aggressive stance early on in the negotiations rather than putting forth a proposal to go forward with the status quo,” said Suzanne Beall, the building association’s legislative director.

Beall acknowledged that some opponents of the coalition’s position may be reluctant to voice their position publicly for fear of being labelled anti-American.

A group representing independent U.S. lumber distributors says terms similar to the 2006 agreement would be acceptable as long as it doesn’t include a quota that would limit access to Canadian wood.

“Ultimately you want to be able to sell to your customers what they want and if what they want is Canadian spruce for example, you want to make sure that it’s available,” said Ben Gann, vice-president of legislative and political affairs for the National Lumber & Building Material Dealers Association.

The group worries that U.S. producers would be unable to make up the shortfall, which the home builders estimate would be two billion board feet per year.

Even though Donald Trump campaigned on getting tough on trade, supporters of a new softwood lumber deal hope that the new president will not want to risk his goal of accelerating U.S. economic growth by hampering the housing sector and raising costs for his massive infrastructure spending plans.

CP3

Industrial Alliance to buy advising firm HollisWealth from Scotiabank

QUEBEC _ Industrial Alliance Insurance and Financial Services (TSX:IAG) has reached a deal to buy advising firm HollisWealth from Scotiabank (TSX:BNS).

Yvon Charest, CEO of Industrial Alliance, said the acquisition would place the Quebec-based company near the top of the largest non-bank wealth management advisory firms in Canada, with $75 billion in assets under administration.

HollisWealth holds $34 billion in assets under administration, 800 licensed advisers, 400,000 active client accounts and over 300 locations across Canada.

The firm was part of Scotiabank’s purchase of DundeeWealth in 2011, which also included asset management firm Dynamic Funds. Dynamic is not part of the transaction announced Monday and will remain part of Scotiabank.

Industrial Alliance said the acquisition price will vary depending on the assets under administration at closing, adding that it will finance the deal though a combination of cash on hand and issuance of common shares, subject to adjustments and other transaction costs.

The sale is expected to close in the third calendar quarter of next year.

CP3

Accountemps identifies 8 of the biggest job search mistakes and how to avoid them:

Job candidates have long been urged to put their best foot forward when applying for open positions. It’s simple advice, yet many job hopefuls fail to heed it. In an Accountemps survey, nearly two in five (39 per cent) Canadian CFOs said the most common mistake people make in their application materials is including irrelevant information; 29 per cent of executives said typos or poor grammar are the most frequent blunders. The biggest slip up during the interview is arriving late, CFOs said.

CFOs were asked, “What do you think is the most common mistake candidates make in their application materials?” Their responses:

They include irrelevant information

39%

They contain typos or poor grammar

29%

They’re not customized to the job the candidate is applying for

19%

They focus on job duties and not accomplishments

8%

Don’t know/no answer

5%

100%

CFOs were also asked “What do you think is the most common mistake candidates make during job interviews?” Their responses*:

Late arrival

33%

Little or no knowledge of the company

23%

Unprepared to discuss skills and experience

18%

Lack of enthusiasm

12%

Unprepared to discuss career plans or goals

8%

Lack of eye contact

5%

99%

* Total does not equal 100 per cent due to rounding.

“Job candidates most likely to land the role are the ones who can demonstrate how they will provide value and contribute to company goals from day one,” said Dianne Hunnam-Jones, Canadian president of Accountemps. “Applicants who take the time to customize their resumes for specific positions, and arrive at interviews promptly and well-prepared, exhibit an enthusiasm for the role that leaves employers with a memorable impression of their ability to succeed.”

Typos and grammatical errors can also send a message that a job seeker lacks follow-through and attention to detail. Following are real-life mistakes seen in job application materials collected by Robert Half, parent company of Accountemps:

  • Skills: “Writing/listening/eaking. I can engage in intellectual conversations with a myrad of professionals.”
  • Job Duties: “Assisted company executives with travel arraignments.”
  • Education: “Currently perusing a master’s degree.”
  • Job Duties: “Communicate financial projections to steakholders.”
  • Cover Letter: “All I ask is for you to consider my perspicacious aspiration to become an erudite factotum in your organization.”
  1. Adding irrelevant information to application materials: Stick to only the facts employers would be interested in, which are typically your credentials, experience and accomplishments. Keep your resume and cover letter concise.
  2. Skipping proofreading: Even one resume typo can eliminate a candidate from consideration. Review your materials thoroughly, and ask a confidant to read them, too.
  3. Failing to prepare: Research the company by reviewing its website and recent news articles. Incorporate what you learn into your cover letter and interview responses by making the connection between what the company needs and what you offer.
  4. Lying: Be honest. Fabricating or overstating your experience is never acceptable.
  5. Having an unflattering online presence: Conduct an online audit of your social media pages and remove any posts that could be perceived as unprofessional or inappropriate.
  6. Being caught off-guard during salary discussions: Consult industry resources such as the 2017 Robert Half Salary Guide to learn about compensation ranges for jobs in your field. Understanding market trends will help you know what your skills and experience are worth.
  7. Relying solely on technology: Look for other ways to find job openings. Attend industry events, join professional associations and ask your current contacts for introductions to new ones.
  8. Going about your job search alone: Partner with a staffing firm and let them open doors for you. Be open to different types of positions, including temporary work.

About the Research
The survey was developed by Accountemps and conducted by an independent research firm. It includes responses from more than 270 CFOs from a stratified random sample of companies in Canada.

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