C A N A D A’ S I N S U R A N C E A N D R I S K M A G A Z I N E . C A N A D I A N U N D E R W R I T E R . C A
O CT O B E R 2 0 1 6 PM#40063170
Bridging the Gap BY GREG MECKBACH
Workmanship Exclusion BY TIMOTHY McGURRIN
Material Non-Disclosure BY JENNIFER PEREIRA
GLOBALLY KNOWN. Founded in 1927, Arthur J. Gallagher is an international insurance, risk management, and benefits consultancy with over 22,000 employees and capabilities in more than 150 countries. As a global organization, our expertise and deep knowledge meets the sophisticated financial needs of our clients worldwide. We are committed to helping our clients thrive, our teammates excel and our communities prosper. These values, combined with our client-first approach to service, have earned us a reputation as one of the top brokerages in the world. As a result, Arthur J. Gallagher is the only insurance broker recognized by the Ethisphere Institute as one of the World’s Most Ethical Companies.
GLOBALLY LOCALLY
World-class insurance and risk m that help Canadian companies th
Arthur J. Gallagher has been helping clients solve unique challenges for nearly 100 years with industry-specific knowledge, insights and actions. Drawing on our foundation of teamwork, ethics and service excellence, we partner with our clients to deliver insurance solutions designed to help them succeed.
ajgcanada.com
Arthur J. Gallagher is the brand name for the international broking and underwrit Globally Known. Locally Grown. is a trademark of Arthur J. Gallagher Canada Lim Arthur J. Gallagher Canada Limited is a subsidiary of Arthur J. Gallagher & Co., a “World’s Most Ethical Companies” and “Ethisphere” names and marks are regis
Y KNOWN. GROWN.
management solutions hrive.
iting division of the parent company Arthur J. Gallagher & Co. (NYSE: AJG). mited. a 2016 World’s Most Ethical Company. stered trademarks of Ethisphere LLC.
LOCALLY GROWN. Our Canadian roots run deep, dating back to 1890. The strength of our team in Canada has grown immensely through the acquisition of a group of well-established, high-calibre regional insurance brokerages. We have become one of Canada’s largest insurance brokerages and we continue to grow organically and through our ability to attract high quality brokerages. With more than 800 insurance professionals and 25 offices across Canada, our team harnesses our collective strengths to deliver exceptional service, coupled with our local expertise. We dig deeper to understand our clients’ business, competitive landscape, challenges and opportunities. As a partner, we strive to deliver insightful, responsive and relevant insurance and risk management solutions to our clients, tailored to their specific requirements. Our long term relationships with our insurance partners are underpinned by our commitment to demonstrating the highest level of professional ethics and by doing what’s right for our clients. These values have allowed us to define our locally grown culture – the same culture for which we are globally known.
The Aviva Community Fund is back – eight years and counting! We’re donating another $1 million dollars. Visit avivacommunityfund.org for competition tips and how to make a difference in your community.
Get involved today!
Submit.
Promote.
Vote.
avivacommunityfund.org Insurance – Home | Auto | Leisure & Lifestyle | Business | Surety Aviva and the Aviva logo are trademarks used under licence by the licensor.
Community Fund
A N A D A’ S I N S U R A N C E A N D R I S K M A G A Z I N E . C A N A D I A N U N D E R W R I T E R . C A
TOB E R 2 0 1 6
40063170
CANADIAN UNDERWRITER
VOL. 83, NO. 10, OCTOBER 2016 CANADA’S INSURANCE AND RISK MAGAZINE. PUBLISHED BY NEWCOM BUSINESS MEDIA INC.
www.canadianunderwriter.ca
COVER STORY
Bridging the Gap
38
Some brokers warn that small businesses can have complex exposures that managers may not consider, while courts have held that both brokers and company agents have a legal duty to give clients not only information, but also counsel and advice. BY GREG MECKBACH
FEATURES
28
16 Workmanship Exclusion
48 Material Disclosure
Earthquake Coverage
In its recent ruling in favour of Galon Insurance Brokers and SGI, a court provided guidance on when non-disclosure is material to the risk being insured.
Quebec faces the risk of a devastating earthquake, and brokers should let homeowners know whether they are adequately covered.
BY JENNIFER PEREIRA
34
BY TED HARMAN
In its ruling in Ledcor v. Northbridge, the Supreme Court of Canada confirmed that the faulty workmanship exclusion under a builder’s risk policy is narrow. BY TIMOTHY MCGURRIN
22 Managing Disasters Local mayor Naheed Nenshi was among the speakers at the 2016 RIMS Canada Conference in Calgary.
Bridging the Gap
56
BY GREG MECKBACH
BY ANGELA STELMAKOWICH
Workmanship Exclusion 54 Dale Rempel Award BY TIMOTHY McGURRIN
When insuring a home containing expensive contents, retaining a properly qualified appraiser benefits the insurance providers.
Tara Chammartin, president of the Insurance Brokers Material Non-Disclosure BY JENNIFER PEREIRA Association of Manitoba and operations manager for La Salle Insurance and Travel Succession Plans Services Ltd., has been When seeking prospective recognized with the Dale managers as part of Rempel Award of Excellence. succession plans, brokerages BY ANGELA STELMAKOWICH need to consider attitude and the ability to motivate the producers.
BY JOHN GROW
BY BRENDA ROSE
Proper Appraisal
60 Educating Brokers In a recent survey of Canadian brokers by the Insurance Institute of Canada, respondents suggested they want a better understanding of new products and coverage options in areas such as cyber risk, overland flooding, driverless cars and the sharing economy. BY PETER HOHMAN
64 Executive Forum Turning insurance outside-in was the theme of the recent Executive Forum. Speakers from Kanetix, Deloitte and SAP explained how advances in data and technologies will affect the industry. BY ANGELA STELMAKOWICH & GREG MECKBACH
October 2016 Canadian Underwriter
3
Curtain Call. Celebrating eight years of recognizing our national leaders. The CIP Society created the National Leadership Awards to celebrate excellence and to recognize individuals who demonstrate a passion for learning, dedication to the profession, personal integrity and outstanding commitment to their organizations. The Society is proud of its role as a supporter of those industry leaders who act as role models and mentors. Their positive influence energizes and inspires the people around them. They enrich their communities. And they bring great credit to our industry. We thank all the nominees, as well as those who took the time to nominate them for this prestigious national award.
To the 2016 Honourees, The CIP Society offers congratulations for earning the respect and admiration of your peers in the industry.
Paul Martin
| CIP
RRJ Insurance Group Limited Toronto, ON Established Leader
Robert Pearson
| FCIP
Town & Country Mutual Insurance Strathroy, ON Established Leader
Laura Van Vliet
| CIP, CRM
ALIGNED Insurance Inc. Waterloo, ON Emerging Leader
Please join us to celebrate the achievements of these 2016 leaders as they are inducted into the CIP Society National Leadership Circle at appropriate local Institute Convocations.
CIP Society National Leadership Circle Established Leaders Ginny Bannerman, CIP (2013) Carla Blackmore, FCIP (2009) Ron Bouwmeister, FCIP (2010) Diane Brickner, CIP (2012) James Cameron, FCIP (2013) Glenn Gibson, CIP (2011) Andrew Janzen, FCIP (2009) Johanne Lépine, FPAA (2014)
Emerging Leaders Barry F. Lorenzetti, CIP (2012) Patrick McNally, FCIP (2009) Lynn Oldfield, FCIP (2014) Greg Thierman, CIP (2010) H. Ross Totten, FCIP (2009) Raymond White, FCIP (2010)
Bryan Bedford, FCIP (2015) Rob Bickerton, FCIP (2010) Patrick Bouchard, PAA (2009) Simon Charbonneau, FCIP (2011) Andrew Clark, FCIP (2011) Drew Collins, CIP (2012) Anne-Marie Deschênes, PAA (2013) Mathieu Gagnon, PAA (2010) Vincent Gaudreau, FPAA (2011)
For more information about the nomination process, to read about our CIP Society National Leadership Circle recipients, or to register to attend the awards presentation at your local Institute Convocation, please visit www.insuranceinstitute.ca/cipsociety
Lindsay Mackenzie, FCIP (2013) Melanie Needham, FCIP (2010) Thomas Newby, CIP (2009) Tammie Norn, FCIP (2013) Adrian Osti, FCIP (2014) Frederik Pelaez, FCIP (2012) Phillip Robichaud, FCIP (2009) Kevin Sigouin, CIP (2012) Jonathan Stone, FCIP (2009)
Editor Senior Publisher Online Editor Angela Stelmakowich Steve Wilson Gary White toMedia providing the most timely and relevant news, and resources professionals from all of astelmakowich@canadianunderwriter.ca steve@canadianunderwriter.ca Editorto insurance Canadian Underwriter’s Insurance Group issegments committed Senior Publisher hsingh@canadianunderwriter.ca Production Manager Angela Stelmakowich Steve Wilson astelmakowich@canadianunderwriter.ca steve@canadianunderwriter.ca Harmeet Singh (416) 510-6793 marketers Twitter: @InsuranceMedia (416) 510-6760 Angela Stelmakowich Steve Wilson industry, providing with a range of specialized andwith resources to insurance from all astelmakowich@canadianunderwriter.ca steve@canadianunderwriter.ca (416) 510-6793 Twitter: @CU_Harmeet @InsuranceMedia Gary professionals White the industry, providing marketers aTwitter: range ofinformation specialized to providing the most and relevant news, (416)timely 510-6800 astelmakowich@canadianunderwriter.ca steve@canadianunderwriter.ca hsingh@canadianunderwriter.ca (416) 510-6793 Twitter: @InsuranceMedia PROFILE Associate Editor (416) Editor 442-5600 ext.opportunities. Senior510-6800 Publisher (416) (416) 3652the industry, and highly effective marketing communications marketers with a rangeSe of 510-6760 (416) 510-6793 Twitter:providing @InsuranceMedia Associate Editor Subscriptions/Customer (416) 510-6800 Greg Meckbach Art Director and highly effective marketing communications Twitter: @CU_Harmeet Angela Stelmakowich Steve Wilson and resources to insurance professionals from allopportunities. segments of Associate Editor (416) 510-6800 Editor Greg Meckbach Senior Publisher Art Director VOL. 81, NO. 2, FEBRUARY 2014 gmeckbach@canadianunderwriter.ca Gail Page Gerald Heydens and highlysteve@canadianunderwriter.ca Associate Editor effective marketing communications o astelmakowich@canadianunderwriter.ca Greg Meckbach (416) ext. 3652 Art Director Associate Publisher Angela442-5600 Stelmakowich gmeckbach@canadianunderwriter.ca Steve Wilson Gerald HeydensSubscriptions/Customer Se VOL. 83, NO. 10, OCTOBER 2016 Twitter: @CU_Greg Greg Meckbach Art Director (416) 510-6793 Twitter: @InsuranceMedia ading by Example the industry, providing marketers with a range of specialized gpage@bizinfogroup.ca gmeckbach@canadianunderwriter.ca Gerald Heydens Art Consultation astelmakowich@canadianunderwriter.ca Twitter: @CU_Greg steve@canadianunderwriter.ca Paul Aquino (416) 510-6796 gmeckbach@canadianunderwriter.ca Gerald HeydensGail Page (416) 510-6800 PROFILE Art Consultation Twitter: @CU_Greg Sascha Hass 510-6793 (416) 510-6796 Associate Publisher Twitter: @InsuranceMedia Associate Editor Cameron, president of (416) 510-5187 Art Consultation communications PROFILE Twitter: @CU_Greg marketing opportunities. Sascha Hass ading by Example paul@canadianunderwriter.ca gpage@bizinfogroup.ca (416) 510-6796 Online Editor and highly effective InsuranceMarket (416) 510-6800 Art Consultation Greg Meckbach Director Editor Senior Publisher Senior Publisher Paul Aquino Sascha Hass Canadian Underwriter’s Insurance Media Group is committed (416) 510-6796 Production Manager Associate Editor Online Editor on & Associates Harmeet Singh Angela Stelmakowich Steve Wilson Sascha Hass gmeckbach@canadianunderwriter.ca Canadian Underwriter’s Insurance Media Group is committed Gerald Heydens Twitter: @InsuranceCanuk Production Manager Cameron, president of Angela Stelmakowich (416) 510-5187 Steve Wilson Circulation Manager Online Editor Gary White Gregthe Meckbach Harmeet Singh Artsteve@canadianunderwriter.ca Director to providing most timely and relevant news, information paul@canadianunderwriter.ca astelmakowich@canadianunderwriter.ca hsingh@canadianunderwriter.ca Production Manager Online Editor Twitter: @CU_Greg nce Consultants Limited, Gary White astelmakowich@canadianunderwriter.ca steve@canadianunderwriter.ca to providing the most timely and relevant news, information Harmeet Singh (416) (416)professionals 510-6760 from all segments gmeckbach@canadianunderwriter.ca hsingh@canadianunderwriter.ca Gerald Heydens (416) 510-6800 Production Manager on & Associates Art Consultation (416) 510-6793 Mary Garufi to510-6788 insurance Twitter: @CU_Harmeet and resources Gary White Harmeet Singh (416) 510-6796 (416)of 510-6760 510-6793 Twitter: @InsuranceCanuk Twitter: @InsuranceMedia Circulation Manager hsingh@canadianunderwriter.caTwitter: and resources to insurance professionals from all segments of @CU_Greg @CU_Harmeet Gary White cognized by the CIP Sascha Hass Art Director Associate Editor (416) 442-5600 ext. 3652 the industry, providing marketers with a rangeService of specialized (416) 510-6760 hsingh@canadianunderwriter.ca mgarufi@bizinfogroup.ca Subscriptions/Customer Art Consultation nce Consultants Limited, (416) 510-6800 National Twitter: @CU_Harmeet National (416) 510-6788 510-6796 Gerald Heydens (416) 442-5600 ext. 3652 the industry, providing marketers with a range of specialized (416) 510-6760 Online Editor Account Manager Associate Editor Subscriptions/Customer Mary Garufi industry’s socia National opportunities. Greg Meckbach the Service insurance Twitter: @CU_Harmeet Gail Page Sascha Hass ycognized when hebyreceived Canadian Underwriter’s Insurance Media Group is committed andClaims highly effective marketing communications Production Manager (416) 442-5600 ext. 3652 Claims (416) 442-5600 ext. 3545 Associate Publisher gmeckbach@canadianunderwriter.ca Subscriptions/Customer Servicemarketing Harmeet Singh Art Consultation the CIPits Greg 442-5600 Meckbach Gail Page Art Director andClaims highly effective communications opportunities. ng by Example Michael Wells (416) ext. 3652 gpage@bizinfogroup.ca Online Editor mgarufi@bizinfogroup.ca Associate Publisher Subscriptions/Customer Service Gary White (416) 510-6796 timely and relevant news, information Paul Aquino Manual Sascha Hass Gail Pageto providing the mostGerald 14 Leading by Example hsingh@canadianunderwriter.ca shed Leader Award. gmeckbach@canadianunderwriter.ca Production Manager Account Manager Manual gpage@bizinfogroup.ca Heydens Associate Publisher meron, president of (416) 510-5187 Harmeet Singh Paul Aquino Gail yngwhen he received its president of (416)Page 510-6760 Print Manual Insuran Online by Example (416) 442-5600 3545 and resources to insurance professionals from all segments of ext. paul@canadianunderwriter.ca michael@canadianunderwriter.ca gpage@bizinfogroup.ca Production Manager Associate Publisher Twitter:Editor @CU_Harmeet James Cameron, @CU_Greg InsuranceMarketer.com Gary White Manager (416) 510-5187 Production Paul Aquino 14 Leading by Example Michael Wells hsingh@canadianunderwriter.ca paul@canadianunderwriter.ca & Associates LA STELMAKOWICH gpage@bizinfogroup.ca Art Consultation Jason Contant InsuranceMarketer.com Twitter: @InsuranceCanuk meron, president of (416) 510-5187 Paul Aquino Karen Samuels Circulation Manager (416) 442-5600 ext. 3652 510-6796 the industry, providing marketers with a range of specialized shed Leader Award. (416) 510-6760 Cameron & Associates Subscriptions/Customer Service 510-5122 National Phyllis Wright paul@canadianunderwriter.ca (416) jcontant@canadianunderwriter.ca @CU_Harmeet Twitter: @InsuranceCanuk James Cameron, president of (416) 510-5187 Sascha Hass Circulation Manager (416) 510-5190 michael@canadianunderwriter.ca (416) 510-6788 paul@canadianunderwriter.ca &Consultants Associates Limited, Print Production Manager Mary Garufi Gail Page (416) 442-5600, Ext. 3652 and highly effective marketing communications opportunities. Insurance Consultants Limited, Twitter: @InsuranceCanuk Claims Circulation Manager 442-5600 ext. 3652 (416) 510-6788 Associate Publisher Online Editor LA STELMAKOWICH Cameron & Associates Subscriptions/Customer Mary GarufiManager Service nized by the CIP the insurance Circulation Twitter: @InsuranceCanuk 14 Leading by Example mgarufi@bizinfogroup.ca Consultants Limited, Circulation Manager Production Manager gpage@bizinfogroup.ca (416) 510-5122 National Associate Publisher Account Manager was recognized by the CIP (416) 510-6788 Phyllis Wright Account Manager President Mary GarufiManual Harmeet Singh Paul Aquino the insurance industry’s social network Gail Page mgarufi@bizinfogroup.ca Insurance Consultants Limited, Mary Garufi en he received its National (416) 510-6788 Claims ext. 3545 (416) 442-5600 Associate Publisher Account Manager James Cameron, presidentitsof Mary Garufi industry’s social network Paul Aquino Gary White (416) 510-5187 nized by the CIP Society the insurance whenby heExample Michael Wells mary@newcom.ca 14 Leading mgarufi@bizinfogroup.ca hsingh@canadianunderwriter.ca paul@canadianunderwriter.ca gpage@bizinfogroup.ca Claims (416) 442-5600 ext. 3545 Creighton Elliot Ford InsuranceMarketer.com was recognized byreceived the CIP Manual Bruce denLeader Award.its paul@canadianunderwriter.ca Account Manager Paul Aquino Michael Wells mgarufi@bizinfogroup.ca (416) 510-6760 Cameron & Associates (416) 614-5831 he received Account Manager InsuranceMarketer.com Manual michael@canadianunderwriter.ca (416) 442-5600 ext. 3545 Established Leader Award. President Account Manager @CU_Harmeet Print Production Manager Twitter: @InsuranceCanuk James Cameron, president of (416) 510-5187 (416) 510-6788 Circulation Manager Society when he received its Michael Wells InsuranceMarketer.com paul@canadianunderwriter.ca michael@canadianunderwriter.ca INSURANCE eford@canadianunderwriter.ca (416) 442-5600 ext. 3545 Print Production Manager Insurance Limited, Print Production Manager dELMAKOWICH Leader Award.BY (416) 510-5122 Michael Wells (416) 510-6788 442-5600 ext. 3652 Phyllis Wright ANGELA STELMAKOWICH Subscriptions/Customer Service Cameron &Consultants Associates Mary Garufi Elliot Ford Account Manager Bruce Creighton michael@canadianunderwriter.ca Established Leader Award. Vice President DIRECTORY Print Production Manager Twitter: @InsuranceCanuk (416) 510-5122 Circulation Manager Phyllis Wright Phyllis Wright was recognized by the CIP ELMAKOWICH (416) 510-5117 INSURANCE michael@canadianunderwriter.ca the insurance industry’s Gail social network Michael Wells Page Print Production Manager mgarufi@bizinfogroup.ca Insurance Consultants Limited, National (416) 510-5122 Account Manager Phyllis Wright (416) 510-6788 Associate Publisher BY ANGELA STELMAKOWICH President eford@canadianunderwriter.ca Account Manager INSURANCE Mary Garufi the insurance industry’s social network the insurance industry’s social network mike@canadianunderwriter.ca Alex Papanou Society when by heby received 14 recognized Leading Example (416) 510-5122 Account Manager DIRECTORY gpage@bizinfogroup.ca Phyllis Wright ext. Claims (416) 442-5600 3545 President was the CIPits Insurance Blogs hosted by Canadian Underwriter Elliot Ford Vice President Paul Aquino Bruce Creighton Michael Wells (416) 510-5122 mgarufi@bizinfogroup.ca insBlogs DIRECTORY Account Manager Manual (416) 510-5117 Established Award.itsof President Newswire James Cameron, president Account Manager Elliot Ford (416) 510-5187 Bruce Creighton insBlogs Insurance Blogs hosted by Canadian Underwriter Society whenLeader he received INSURANCE eford@canadianunderwriter.ca Property & Casualty Insurance paul@canadianunderwriter.ca InsuranceMarketer.com Account Manager michael@canadianunderwriter.ca (416) 442-5600 ext. 3545 President Account Manager Print Production Manager L FOCUS Papanou Elliot Ford Property & Casualty InsuranceAlex Newswire Bruce Creighton Michael Wells INSURANCE eford@canadianunderwriter.ca BY ANGELA STELMAKOWICH Vice President DIRECTORY Cameron & Associates (416) 510-5117 Twitter:510-5122 @InsuranceCanuk Established Leader Award. Elliot Ford Christine Giovis (416) Circulation Manager Bruce Creighton Phyllis Wright Vice President DIRECTORY eford@canadianunderwriter.ca michael@canadianunderwriter.ca (416) 510-5117 Alex Papanou Print Production Manager Insurance Consultants Limited,Insurance Blogs hosted by Canadian Underwriter 14 Towards Integration christine@canadianunderwriter.ca (416) 510-6788 eford@canadianunderwriter.ca BY ANGELA STELMAKOWICH Vice President Mary Garufi INSURANCE the insurance industry’s social network insBlogs Alex Papanou L FOCUS (416) 510-5117 Connect with Canadian insBlogs Underwriter (416) 510-5122 (416) 510-5114 Insurance Blogs hosted by Canadian Underwriter Account Manager Phyllis Wright Vice President President was recognized Traci Boland, by thethe CIPProperty & Casualty Insurance Newswire CUS (416) 510-5117 Papanou mgarufi@bizinfogroup.ca Property & Casualty InsuranceAlex Newswire DIRECTORY Property & Casualty Insurance Newswire AccountFord Manager Elliot SPECIAL FOCUS Papanou Bruce Creighton Property &insBlogs Casualty InsuranceAlex Newswire Society when he received president-elect of the its 442-5600 ext. 3545 Account President Insurance(416) Blogs hosted by Canadian Underwriter CUS MichaelManager Wells Connect with Canadian Underwriter INSURANCE eford@canadianunderwriter.ca Connect with Canadian Underwriter Established twitter.com/CdnUnderwriter facebook.com/CanadianUnderwriter Elliot Ford SPECIAL FOCUSLeader Insurance BrokersAward. torial Bruce Creighton Connect with Canadian UnderwriterDIRECTORY Vice President insBlogs.com michael@canadianunderwriter.ca Print Production Manager (416) 510-5117 6BYAssociation Editorial Insurance Blogs hosted by Canadian Underwriter insBlogs.com ANGELA STELMAKOWICH Insurance Blogs hosted by Canadian Underwriter eford@canadianunderwriter.ca Connecttwitter.com/CdnUnderwriter with Canadian Underwriter of Ontario, Alex Papanou facebook.com/CanadianUnderwriter (416) 510-5122 Insurance Blogs hosted by Canadian Underwriter Phyllis Wright Insurance Blogs hosted by Canadian Underwriter torial Connecttwitter.com/CdnUnderwriter with Canadian Underwriter Vice President insBlogs twitter.com/CdnUnderwriter facebook.com/CanadianUnderwriter facebook.com/CanadianUnderwriter (416) 510-5117 Insurance Blogs hosted by CanadianProperty Underwriter & Casualty 6 Editorial ketplace suggests brokers remain Insurance Newswire SPECIAL FOCUS Alex Papanou Insurance BlogsAccount hosted byManager Canadian UnderwriterProperty & Casualty Insurance Newswire linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwr twitter.com/CdnUnderwriter facebook.com/CanadianUnderwriter 8 Marketplace President InsuranceMediaGroup.com .ca twitter.com/CdnUnderwriter linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwriter facebook.com/CanadianUnderwriter concerned about a lack of InsuranceMediaGroup.com rketplace .ca Elliot Ford Bruce Creighton linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwriter SPECIAL FOCUS Connect with Canadian Underwriter InsuranceMediaGroup.com Marketplace ves & Views 8 integration between broker InsuranceMediaGroup.com 6 Editorial linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwr eford@canadianunderwriter.ca instouch.com/group/CanadianUnderwriter insBlogs.com Published by Published linkd.in/CanadianUnderwriter by 56 Moves & Views InsuranceMediaGroup.com www.CanadianUnderwriter.ca/MediaGroup Insurance Blogs hosted by Canadian Underwriter instouch.com/group/CanadianUnderwriter Vice President Published linkd.in/CanadianUnderwriter bywith Canadianwww.CanadianUnderwriter.ca/MediaGroup Connect Underwriter systems and (416) 510-5117 ves & Views 6 management twitter.com/CdnUnderwriter facebook.com/CanadianUnderwriter www.CanadianUnderwriter.ca/MediaGroup Editorial Alex Papanou 56 Moves & Views lery Insurance Blogs hosted by Canadian Underwriter software. 8 insurers’ Marketplace Canadian BUSINESS UnderwriterMEDIA iswww.CanadianUnderwriter.ca/MediaGroup published NEWCOM INC. thirteen times yearly (monthly + the Annual Statistical Issue) by 58 Gallery
National
INSURANCEINSURANCE – – Claims we have it covered. weManual have it covered. INSURANCE – we have it covered.
instouch.co
insBlogs Ontario INSURANCE
insBlogs Ontario Photo: Peter Tym
Photo:Thompson Patrick Thompson Photo: Patrick Photo:Thompson Patrick Thompson Photo: Patrick Thompson Photo: Patrick
Photo:Thompson Patrick Thompson Photo: Patrick
Photo:Thompson Patrick Th Photo: Patrick
VOL. 81, NO. 2, FEBRUARY 2014 PROFILE the
instouc instouch.com instouch.com DIRECTORY
insBlogs Ontario insBlogs
BY GREG MECKBACH
6 Editorial 56 Moves & Views 58 Gallery 8 Marketplace 58 Gallery 56 Moves & Views FOCUS 58SPECIAL Gallery
8 Editorial 10 Marketplace 68 Moves & Views 70 Gallery
Underwriter February 2014 4 Canadian Underwriter February 2014 Underwriter February 2014 4 Canadian Underwriter February 2014
4 Canadian Underwriter February 2014 4 Canadian Underwriter February 2014
dian Underwriter February 2014 4 Canadian Underwriter February 2014
dian Underwriter February 2014 6
Canadian Underwriter October 2016
instouch.com instouch.com
instouch.com
insBlogs
Ontario
Ontario
insBlogs Ontario insBlogs
insBlogs
Editorial Editorial Marketplace Marketplace Moves & Views Moves & Views Gallery SPECIAL FOCUS lery 8 Marketplace 56 Gallery Moves & Views Gallery 58
insBlogs Ontario
instouch.com
insBlogs.com
Ontario insBlogs.com insBlogs Insurance Blogs hosted by Canadian Underwriter
Insurance Blogs hosted by Canadian Underwriter
insBlogs.com insBlogs.com
Insurance Blogs hosted by Canadian Underwriter
insBlogs.com .ca
InsuranceMediaGroup.com
.ca
.ca
twitter.com/CdnUnderwriter facebook.com/CanadianUnderwriter www.CanadianUnderwriter.ca/MediaGroup .caStatistical Issue) by linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwriter NEWCOM MEDIAM3B INC. 2S9 InsuranceMediaGroup.com Canadian at thirteen 80 Valleybrook Drive,BUSINESS Toronto, Ontario, Canadian Underwriter Underwriter is is located published times yearly (monthly + the Annual Statistical Issue) by NEWCOM BUSINESS MEDIA INC. 451 Attwell Dr., Toronto, ON M9W 5C4 Canadian Underwriter iswww.CanadianUnderwriter.ca/MediaGroup published thirteen timesthirteen yearly (monthly + the Annual(monthly Statistical Issue) NEWCOM BUSINESS MEDIA INC. Canadian Underwriter is published times yearly + thebyAnnual NEWCOM BUSINESS MEDIA INC.
InsuranceMediaGroup.com InsuranceMediaGroup.com Connect with Canadian UnderwriterInsuranceMediaGroup.com InsuranceMediaGroup.com NEWCOM BUSINESS MEDIA INC.
Phone: (416) 442-5600. NEWCOM BUSINESS MEDIA INC.
Canadian at thirteen 80 Valleybrook Drive,(monthly Toronto, + Ontario, M3B Statistical 2S9 Canadian Underwriter Underwriter is is located published times yearly the Annual Issue) by linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwriter (416) 614-2200 • MEDIA (416) 614-8861 (fax) Phone: 442-5600. NEWCOM BUSINESS Canadian is at thirteen 80 Valleybrook Drive,(monthly Toronto, + Ontario, M3B Statistical 2S9 Published by Underwriter Canadian Underwriter is located published times yearly the Annual Issue) by All rights reserved. Printed in Canada. The contents of(416) this publication may INC. not be reproduced or transmitted www.CanadianUnderwriter.ca/MediaGroup All rights reserved. Printed in Canada. The contents of this publication may not be reproduced or transmitted in any form, either in part or in full, includingAll photocopying and recording, the written consent the rights reserved. Printed in without Canada. TheINC. contents of thisofpublication may not be reproduced or transmitted Phone: (416) 442-5600. NEWCOM BUSINESS MEDIA in any form, either in may part any or inpart full,ofincluding photocopying andinrecording, without the written consent the All rights Printed The contents of thisofpublication may without not be reproduced transmitted President Chairman and Founder copyright owner. Nor this publication bereserved. stored apart retrieval system of any nature without in any form, either in orininCanada. full, including photocopying and recording, the written or consent of the copyright owner. Nor may any part of this publication be twitter.com/CdnUnderwriter stored ininapart retrieval system any nature withoutfacebook.com/CanadianUnderwriter in any form, either or inpart full,ofincluding photocopying andinrecording, the written consent the prior written consent. copyright owner. Nor may any this publication be (monthly stored a retrieval system of any nature without All rights reserved. Printed inof Canada. The contents of without this publication mayofnot be reproduced or transm Canadian Underwriter iswww.CanadianUnderwriter.ca/MediaGroup published thirteen times yearly Annual Statistical NEWCOM BUSINESS MEDIA INC. prior written consent. copyright owner. Nor may any part of this publication be stored in +a the retrieval system of anyIssue) natureby without All rights reserved. Printed in Canada. The contents of this publication may without not be reproduced transm prior written consent. NEWCOM BUSINESS MEDIA INC.and © Published monthly as a source of news, technical information and comment, as a link between in any form, either in part or in full, including photocopying and recording, the written or consent prior written consent. © Published monthly as a source of news, technical information and comment, and as a link between in any form, either in may part orValleybrook inpart full, including photocopying and recording, without written consent Vice President, Operations Controller all segments of the insurance industry including brokers, agents, insurance andatofreinsurance companies, © Published monthly as alocated source news, technical information and comment, and as ain link Canadian is 80 Drive, Toronto, Ontario, M3B 2S9 Canadian Underwriter isNor thirteen times (monthly + the Annual Statistical Issue) by copyright owner. any ofyearly this publication be stored a between retrieval systemthe of any nature witho all segments the insurance industry including brokers,Underwriter agents, insurance andofreinsurance companies, linkd.in/CanadianUnderwriter instouch.com/group/CanadianUnderwriter © Published monthly as apublished source news, technical information and comment, and as a link between adjusters, riskofmanagers and consultants. all segments of the insurance industry including brokers, agents, insurance and reinsurance companies, Phone: (416) 442-5600. copyright owner. Nor may part of this publication be stored in a retrieval system of any nature witho NEWCOM BUSINESS MEDIA INC. any adjusters, risk managers and consultants. all segments the insurance industry including brokers, agents, insurance and reinsurance companies, prior written consent. adjusters, riskofmanagers and consultants. prior written consent. adjusters, risk managers andinconsultants. All rights reserved. Printed Canada. The contents of this publication may not be reproduced or transmitted Director ofeither Circulation Allany rights reserved. Printed Canada. The contents of this publication may without not be reproduced transmitted Privacy Notice in form, in part orininas full, photocopying and recording, the written consent of the and as a link between © Published monthly a including source of news, technical information and or comment, www.CanadianUnderwriter.ca/MediaGroup in any form, either in may part or inas full, photocopying andinrecording, without written consent of the and as a link between From time to time we make our subscription list available to select companies and organizations whose Privacy Notice © Published monthly aofincluding source of news, technical information and comment, copyright owner. Nor any part this publication be stored a retrieval systemthe of any nature without all segments of the insurance industry including brokers, agents, insurance and reinsurance companies copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without product or service may interest you. If you do From not wish your contact information to be made available, time to consent. time we make our subscription list available to select companies and organizations whose priorsegments written all of the insurance industry including brokers, agents, insurance and reinsurance companies prior written consent. please contact us via one of the following methods: adjusters, risk managers and consultants. product or service may interest you. If you do not wish your contact information to be made available, Canadian Underwriter is published thirteen times yearly (monthly and + the Annual Statistical Issue) by © Published monthly as a source of news, technical information comment, and as a link between adjusters, risk and consultants. please contact us viamanagers one ofsource the following methods: © Published monthly as a of news, technical information and comment, and as a link between NEWCOM BUSINESS MEDIA INC. Phone: 1-800-668-2374 Fax: 416-442-2191Canadian Underwriter is published thirteen times yearly (monthly + the Annual Statistical Issue) by all segments of the insurance industry including brokers, agents, insurance and reinsurance companies, all segments the insurance industry including brokers, agents, insurance and reinsurance companies, E-mail: jhunter@businessinformationgroup.ca NEWCOM BUSINESS MEDIA jhunter@annexnewcom.ca Phone: 1-800-668-2374 Fax:INC. 416-442-2191 adjusters, riskofmanagers and consultants. Canadian Underwriter is located at 80 Valleybrook Drive, Toronto, Ontario, M3B 2S9 adjusters, risk managers and consultants. Mail to: Privacy Officer, 80 Valleybrook Drive, E-mail: Toronto, Ontario, M3B 2S9 jhunter@businessinformationgroup.ca Privacy Notice jhunter@annexnewcom.ca Phone: 442-5600. All rights(416) reserved. Printed in Canada. The contents of this publication may not be reproduced or transmitted Mail to: Privacy Officer, 80 Valleybrook Drive,subscription Toronto, Ontario,list M3Bavailable 2S9 From time to in time we make our toreproduced select companies in any form, either part or inCanada. full, including photocopying recording, without written consent of the and organizations whose Privacy Notice All rights reserved. Printed in The contents of this and publication may not bethe or transmitted GST Registration number 890939689RT0001 Subscription Rates: 2013 2016 Canada copyright owner. Norwe may any part of including this publication be stored innot a retrieval system any nature without From to time make our subscription list available to select companies andof organizations whoseof the to be made available, product or service may interest you. If you do wish your contact information in anytime form, either in part or in full, photocopying and recording, without the written consent Second Class Mail Registration Number: 08840 GST Registration number 890939689RT0001 Subscription Rates: 2013 Canada 1 Year $49.95 plus applicable taxes 2016 $51.95 prior written consent. product or service may interest you. If you do not wish your contact information to be made available, copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without Publications Mail Agreement #40069240 #40063170 Second Class Mail Registration Number: 08840 please contact us via one methods: 1 Year $49.95 plus applicable taxesof the following 2 Years $73.95 $51.95 $75.95 plus applicable taxes please contact us via oneUnderwriter of the following methods: prior written consent. © Since 1934, Canadian the voice of Canada’s insurance industry - a monthly magazine Mail Agreement #40069240 #40063170 2Return Years $73.95 plusCanadian applicable taxeshasto:been Publications $75.95 undeliverable addresses Single Copies $10 plus applicable taxes providing the highest quality and most relevant news and insight toand insurance professionals from all segments of Phone: 1-800-668-2374 Fax: 416-442-2191 Phone: 1-800-668-2374 Fax: 416-442-2191 © Published monthly as a source of news, technical information comment, and asto: a link between Circulation Dept. Return undeliverable Canadian addresses Canada’s property and casualty insurance market. The magazine is delivered on a direct-request circulation basis Single Copies $10 plus applicable taxes E-mail: jhunter@businessinformationgroup.ca jhunter@annexnewcom.ca all segments of the insurance industry including brokers, agents, insurance and reinsurance companies, Elsewhere Canadian Underwriter Circulation Dept. brokers, E-mail: jhunter@businessinformationgroup.ca jhunter@annexnewcom.ca to 15,000 senior decision makers nationally, including insurance risk managers, insurance and reinsurMail to: Privacy Officer, 80 Valleybrook Drive, Toronto, Ontario, M3B 2S9 adjusters, risk managers and consultants. 80 Valleybrook Drive, Toronto, Elsewhere 1 Year $73.95 Underwriter $71.95 ance company personnel, claimsOntario managers and Canadian adjusters. Since its beginnings, CanadianM3B Underwriter Mail to: Privacy Officer, 80 Valleybrook Drive, Toronto, Ontario, 2S9has been a 2S9 80 Valleybrook Drive, Toronto, Ontario with award-winning coverage 1M3B Year $73.95 $71.95 link between all segments of the insurance industry, providing insurance professionals Annual Statistical Issue GST Registration number 890939689RT0001 Subscription Rates: 2013 2016 Canada M3B 2S9 Privacy Notice of industry issues, trends, news, personalities and events written by Canada’s leading insurance journalists. We acknowledge the financial support (included with above subscription) Second Class Mail Registration Number: 08840 Annual Issue 1 Year Statistical $49.95 plus applicable taxes $51.95 From to time we make ourthrough subscription available to select companies and organizations whose GST Registration number 890939689RT0001 Subscription Rates: 2013 Canada listPublications of thetime Government ofsubscription) Canada 2016 We acknowledge financial support or separately $38 Mail the Agreement #40069240 $39 plus applicable taxes (included with above #40063170 2 Years $73.95 plus applicable taxes $75.95 product or service may interest you. If you do not wish your contact information to be made available, Subscription 2016 Fund Canada GST number 890939689RT0001 the CanadaRates: Periodical of the of theRegistration GovernmentSecond of Canada throughMail Registration Number: 08840 Class or separately $38 plus applicable taxes $39 1please Year $49.95 plus applicable taxes $51.95 contact us via one of the following methods: Return undeliverable Canadian addresses to: 1Year $51.95 plus applicable taxes Second Class Mail Registration Number: 08840 Subscription Inquiries/Customer Service Department of Canadian Heritage thePrint: Canada Periodical Fund of the Single Copies $10 plus applicable taxes ISSN 0008-5251 Publications Mail Agreement #40069240 #40063170 Circulation Dept. 2Years $75.95 plus applicable taxes Publications Agreement #40063170 Bona Lao (416) 442-5600 ext 3552 Mary Garufi (416) 614-5831 Subscription Inquiries/Customer Service 2Phone: Years $73.95 plus Department ofMail Canadian Heritage $75.95 1-800-668-2374 Fax:applicable 416-442-2191taxes ISSN Print: 0008-5251 Elsewhere ISSNCanadian Digital: 1923-3426 Underwriter blao@bizinfogroup.ca mary@newcom.ca Bona Lao (416) 442-5600 ext 3552 Mary Garufi (416) E-mail: jhunter@businessinformationgroup.ca Single Copies $10 614-5831 plus applicable taxes Return undeliverable Canadian addresses Return undeliverable Canadian addresses to: 80 Valleybrook Drive, Toronto, Ontario to:ISSN Digital: 1923-3426 1 Year $71.95 blao@bizinfogroup.ca mary@newcom.ca Mail to: $73.95 Privacy Officer, Valleybrook Drive, Toronto, Ontario, M3B 2S9 Single Copies $1080plus applicable taxes Circulation M3B 2S9 Dept.Circulation Dept. Elsewhere Canadian Underwriter Annual Statistical Issue 1Year $71.95 We the financial support GST Registration number 890939689RT0001 Subscription Rates: 2013 Canada 80 acknowledge Valleybrook Drive, Toronto, Ontario Elsewhere Canadian Underwriter (included with above subscription) of the 2S9 Government of Canada through Second Class Mail Registration Number: 08840 M3B 1 Year $49.95 plus applicable taxes or separately $38 plus applicable taxes $39 Annual Statistical Issue 80 Valleybrook Drive, Toronto, Ontario 1 Year $73.95 $71.95 the Canada Mail Periodical Fund #40069240 of the Publications Agreement 2 Years $73.95 plussubscription) applicable taxes (included with above We acknowledge the financial support Subscription Service M3B 2S9 Department of Canadian Heritage or separately Inquiries/Customer $39 plus applicable taxes ISSN Print: 0008-5251 Return undeliverable Canadian addresses to: of the Government of Canada through SingleGarufi Copies $10 plus Issue applicable taxes Bona Lao (416) 442-5600 ext 3552 Mary (416) 614-5831 Annual Statistical Circulation Dept. the Canada Periodical Fund of the ISSNfinancial Digital: 1923-3426 Subscription Inquiries/Customer Service blao@bizinfogroup.ca mary@newcom.ca We acknowledge the support (included with above subscription) Elsewhere Canadian Underwriter Department of Canadian Heritage Mary Garufi (416) 614-5831 ofToronto, the Government of Canada through 80 Valleybrook Drive, Ontario 1 Year $73.95 $38 or separately mary@newcom.ca $39 plus applicable taxes M3B 2S9 the Canada Periodical Fund of the Annual Statistical Issue We acknowledge the financial support Subscription Inquiries/Customer Service (included with above subscription) Department of Canadian Heritage ISSN Print: 00 of theMember Government of Canada through or separately $38 plus applicable taxes Bona Lao (416) 442-5600 ext 3552 Mary Garufi (416) 614-5831 the Canada Periodical Fund of the ISSN Digital: 1 Subscription Inquiries/Customer Service blao@bizinfogroup.ca Department of Canadian Heritage mary@newcom.ca ISSN Print: 0008-5251 Bona Lao (416) 442-5600 ext 3552
Jim Glionna
Joe Glionna
.ca
InsuranceMediaGroup.com Melissa Summerfield Anthony Evangelista Pat Glionna
ISSN Digital: 1923-3426
blao@bizinfogroup.ca
ISSN Print: 0008-525 ISSN Digital: 1923-34
See Your Entire Book of Business As a digital brokerage, Drayden Insurance understands to grow and thrive in today’s changing marketplace, you need a single view into your customer relationships, sales opportunities, financial accounting, and policy administration across all lines of business. See how Drayden Insurance gains a single view of its book of business with Applied: Appliedsystems.ca/singleview
LOREEN BELOVICH
SVP and CFO, Drayden Insurance
appliedsystems.ca
T-68143_Drayden_ad_Canadian_Underwriter_June_r2_FIN.indd 1
5/18/16 1:51 PM
EDITORIAL
Defining the Threat
One reason brokers add value is because the average consumer does not understand insurance terms and conditions very well. Greg Meckbach Associate Editor Canadian Underwriter gmeckbach @ canadianunderwriter.ca
8
Canadian Underwriter October 2016
Insurance brokers are facing considerable challenges in 2016, with different overland flood wordings, competition from direct writers such as Sonnet and the changes to Ontario auto that took effect this past June. But to properly address threats and to take advantage of opportunities, a broker first needs to determine both the true threats and true opportunities. This is not necessarily a straight-forward consideration. Consider the notion, touted by some, that a good place to shop for insurance is the same place that sells paperback novels online? How many licensed agents would an online retailer hire? How accessible would those agents be to consumers with detailed questions about insurance? Tara Chammartin — president of the Insurance Brokers Association of Manitoba and 2016 recipient of the Dale Rempel Award — says she is “not scared” of online competition. She says the service brokers offer “will outshine” an 800 number. [For more details please see Passion Play, page 54]. There was once a notion that a good channel through which to purchase insurance is an Internet search engine. But Google Compare — which did not provide advice and shut down this past March— did not last much longer than Joanie Loves Chachi. In a recent survey by
Insurance Institute of Canada, some brokers identified the need for greater education in some product areas, especially cyber. [For more details please see Learning Curve, page 60]. Traci Boland, presidentelect of the Insurance Brokers Association of Ontario, notes that different insurers have different residential water policies. [For more details, please see Broker Management, p. 14]. Consumers could, in theory, do their own research on the various overland flood coverages and try to decide what is best for them. But in reality, homeowners need advice. While a lack of detailed knowledge of insurance products could be characterized as a challenge for brokers, it is inconceivable that this could be considered a threat rather than an opportunity for the broker channel. One reason brokers add value is because the average consumer does not understand insurance terms and conditions very well. One challenge for brokers is errors and omissions liability — the threat of being sued for negligence by a policyholder whose claim was denied because the plaintiff’s policy did not cover a certain risk. This risk is a challenge, but one that should be seen as an opportunity rather than a threat. Without coverage gaps, there would probably be fewer lawsuits against brokers
arising from denied claims, but there would also be fewer opportunities to upsell. Some might consider the banks to be a threat. However, of the Big 5, only one (Toronto Dominion) actually writes home and auto insurance, now that Aviva has acquired RBC General Insurance. The Bank of Montreal sells neither home nor auto insurance. Meanwhile, the Bank of Nova Scotia and the Canadian Imperial Bank of Commerce sell home and auto but those policies are written by subsidiaries of Desjardins. With the impending fiveyear review of the Bank Act, there could be political pressure from financial institutions to ease restrictions on banks selling non-authorized types of insurance. Is this really a threat? Consider how knowledgeable banks are when it comes to authorized insurance. Many borrowers have been pitched creditor’s disability insurance by a bank employee. But how many banks actually employ licensed agents to sell insurance to creditors? Perhaps one overlooked challenge for brokers is complacency on the part of consumers and corporate decision makers. Convincing some people that something bad could happen to them is easier said then done. After all, once a person suffers a catastrophic loss, it really is too late to sell a policy.
SPECIAL ADVERTISING FEATURE
WATER, WATER, EVERYWHERE Insurers today are operating in an extremely dynamic marketplace, with changes in demographics and consumption, environment, technology, and social values. These shifts are game-changing, and making it essential for insurers to become more responsive and adaptive to the ways in which customers today research, buy and build trust. The winners are those who can genuinely build a consumer-centric business model. At RSA, we have been tirelessly building and improving our customer-centric model over the past several years. We have successfully moved the needle in this endeavour by investing in our broker channel – through education, financing support, and above all, listening to our broker partners and using your feedback and insights to create tailored propositions for the end customer. Evolving how we do business has helped drive our partnership with the broker channel forward and deliver solutions that meet brokers’ and customers’ evolving needs. In fact, over the past 18 months, we have made nearly 100 changes, large and small; to the way we approach Personal Insurance in order to address broker pain points. The growing uncertainty of water With new, complex water coverage emerging in our industry, and the increasing incidence of extreme weather events such as floods in Canada, it was clear that customers needed simplified, easy-to-understand coverage, as well as choice. We conducted a survey among Canadian consumers, which revealed that although 28 per cent of respondents had experienced water damage in their homes, 29 per cent of consumers weren’t sure what their policies covered. We recognized that with new flood coverage products on the market, in addition to government disaster assistance programs, it was an ongoing challenge for insurers, brokers and customers to educate effectively on customer coverage options. In addition, our brokers have always been open with us about their desire to be able to provide options for their customers. Response to demand for clarity One of the ways in which we successfully turned this customer and broker feedback into action was the launch of Waterproof Coverage™, a new overland flood coverage
12663_RSA-CU-Article-1016_FA.indd 1
in November 2015 that combined coverage for sewer back-up and freshwater flooding. It has since become widely available to customers across Canada. We know that one of our broker’s priorities is to get their clients the best coverage available, while keeping their customers premiums low, which is why we now offer two à la carte options: • Limited Sewer Backup Endorsement This coverage protects property from damage resulting from sewer, sump pump or septic back-up • Waterproof Coverage Endorsement This provides all the coverage of the Limited Sewer Backup Endorsement, plus the enhanced protection against damage caused by freshwater flooding as well as damage caused by eaves, downspouts and drains Waterproof Coverage™ is convenient, clear and easy to understand coverage for the customer – something we know brokers wanted: making your life easier by offering your Personal Insurance clients the option to choose singular coverage that’s clear and simple to understand. It’s a single endorsement that is accessible for most policyholders. This gives customers the choice to enhance their level of protection from basic sewer back-up coverage to include flood coverage, or simply keep
sewer back-up according to their needs. We solicited feedback from brokers and considered the ease of introduction and workflows when designing this offering. We also asked Canadian consumers what they needed in terms of coverage. At the end of the day, we wanted to create a solution that catered to homeowners who need clear advice to help them assess property needs and parse out the differences between an enhanced product and conventional sewer back-up coverage. Overwhelming response The response to the product launch across the board has been extremely positive. Currently, brokers representing nearly 60% of our property risks in AB, BC, Manitoba, Ontario and Atlantic have signed up for Waterproof coverage on renewal. Of Brokers supporting the coverage on renewal, their new business uptake rate is over 65%. Our Waterproof Coverage™ webpage (rsabroker.ca/water) is the most visited page to date. Not only is the page popular in terms of site visits, but visitors are spending a significantly larger amount of time there compared to other pages, demonstrating the renewed focus on providing engaging and educational content that helps fill a gap in the market from an end customer perspective.
2016-10-06 11:36 AM
MARKETPLACE
Canadian Market HUB BUYS ONTARIO BROKERAGE, ALBERTA MGA Hub International Limited announced September 8 it has acquired Barrie, Ontariobased Sarjeant Insurance Brokers Limited and Edmonton-based managing general agency New Dimensions Underwriters Ltd. The terms of the acquisitions were not disclosed. Among other things, Sarjeant places auto, residential and watercraft insurance. Randall Maxim, Sarjeant’s president, and Patricia Hanmer, Sarjeant’s vice president, will join Hub Ontario. Russ Davis, owner and president of New Dimensions, will join Hub Financial.
SONNET TO WRITE AUTO DIRECTLY: ECONOMICAL Economical Insurance reported in September it is selling auto insurance online directly through Sonnet, which went live this past May with personal property insurance. In addition to a quote and bind process, customers can get multiple quotes and make changes to a policy online.
AVIVA CANADA ROLLS OUT EQUESTRIAN COVERAGE Aviva Canada is launching liability and medical coverage for equestrians in Manitoba and Saskatchewan through Henry Equestrian Insurance 10 Canadian Underwriter October 2016
Brokers Ltd. of Aurora, Ontario. Coverages include surgical insurance for horses. Options include “full mortality, medical and disability coverage, trailer and equipment protection, to 24/7 claims expert service,” states Dennis Graham, president and chief executive officer of Henry.
AIG TO SELL LLOYD’S UNIT TO CPP INVESTMENT BOARD The Canada Pension Plan Investment Board has announced it has agreed to acquire 100% of Ascot Underwriting, the capital provider for Lloyd’s Syndicate 1414, from American International Group Inc. (AIG). The deal is subject to regulatory approval. AIG reported it will receive about US$240 million in net cash proceeds from the deal. Ascot Underwriting’s coverages include, among others, property, energy, cargo, terrorism and political risk and marine.
Regulation ONTARIO TORIES CALL FOR CAP ON CONTINGENCY FEES Former Ontario Progressive Conservative Leader Tim Hudak tabled in September a private member’s bill that proposes limits on lawyers’ contingency fees, referral fees and personal injury lawsuits over medical assessment costs. Hudak is currently the PC finance critic. If passed into law, Bill 12 would change the Solicitors
Act such that an agreement with a lawyer or paralegal, on a fee arrangement, “must disclose how the fee is calculated,” and that disclosure would have to be made “in a clear, comprehensible and prominent manner.” Bill 12 would also cap contingency fees at 33%. With Bill 12, Hudak also proposes changes to the Law Society Act to “prohibit lawyers in auto insurance cases from receiving referral fees, except upon the successful completion of a claim.”
Claims PRAIRIE STORMS LOSSES PEGGED AT $66 MILLION Insured damage from severe storms July 18 to 20 that swept through the southern Prairies was estimated at $66 million, Insurance Bureau of Canada reports. IBC uses figures from Catastrophe Indices and Quantification Inc. (CatIQ). “This system caused significant hail damage in Medicine Hat, Alberta and caused tornadoes in Saskatchewan and Manitoba,” notes an IBC statement. Most damage was reported in Alberta.
B.C. MOTORIST INJURED ON ATV COVERED: COURT A British Columbia court recently ruled against Insurance Corporation of B.C. (ICBC) when it found that a man who suffered a spinal injury while riding his all-terrain vehicle, in order
to unload it from his pick-up truck, is entitled to accident benefits. Provincial law stipulates that ICBC is not liable to pay benefits if the injured person is “an occupant” of a vehicle — such as an ATV — which cannot be licensed under the Motor Vehicle Act. In 2005, Sheldon Prosofsky had loaded his Polaris ATV into the box of his pick-up truck. When Prosofsky arrived at his destination, he set up a ramp on his pick-up truck, mounted the seat of the ATV, placed it into neutral and using the brake, began to ease the ATV down the ramp. But an under-inflated tire got caught in the ramp, causing the front-end of the ATV to rise up. Prosofsky fell to the ground. A judge with the Supreme Court of British Columbia ruled in August Prosofksy was not “operating” his ATV and was not an “occupant.” Instead, Prosofksy “was injured as a result of using his pick-up truck to transport an item,” Justice Hope Hyslop ruled.
OTTAWA ASKED TO “STRENGTHEN” PACICC Property and Casualty Insurance Compensation Corporation (PACCIC) is urging federal finance minister Bill Morneau to “carefully look” at recommendations in a C.D. Howe Institute report released August 3. In the report, Fault Lines: Earthquakes, Insurance, and Systemic Financial Risk,
MARKETPLACE
author Nicholas Le Pan suggests a catastrophe such as an earthquake “would exceed the existing capacity of Canada’s insurance industry and would exceed PACICC’s ability to meet policyholder claims” if losses were to exceed $30 billion. Among Le Pan’s recommendations are to “strengthen PACCIC so it can intervene before insurance companies in financial difficulty become insolvent,” he wrote. Le Pan added that unless PACICC “has a federal guarantee similar to that” of Crown corporation Canada Deposit Insurance Corporation (CDIC), PACICC “will be limited in the financial assistance” it could give. CDIC protects deposits of up to $100,000 in case of failure of a financial institution. Unlike CDIC, “PACICC has only intervened after a company has failed,” notes Le Pan, former federal superintendent of financial institutions. PACICC “welcomes the findings,” says Paul Kovacs, chief executive officer of PACICC. “We urge the Minister of Finance to look carefully at his policy recommendations.”
Technology HOME DEPOT DATA BREACH SETTLEMENT APPROVED An Ontario court has approved a settlement — in a classaction lawsuit against Home Depot of Canada Inc. and its corporate parent — arising
from a data breach in 2014. The Ontario Superior Court of Justice valued the settlement — which creates a non-reversionary fund of $250,000 “for the documented claims of Canadians whose payment card information and/or email address was compromised as a result of the data breach during the data breach period” — at about $400,000 to the settlement class members. Home Depot denies any wrongdoing. Between April and June of 2014, Home Depot’s “payment card system was hacked by criminal intruders using custom-built malware to clandestinely breach Home Depot’s computer system,” Justice Paul Perrell wrote, adding that there is “no evidence that a Class Member absorbed a fraudulent charge.” The only consumers affected “were those that used their payment card by swiping its magnetic chip through the card reader at self-check-out terminals... that had been infected by the malware,” Justice Perrell noted, adding there is “little risk of fraudulent charges because of sophisticated safeguards developed by credit card companies.”
Risk TORONTO PORT FLOOD PROJECT GETS FUNDING The federal and Ontario governments recently pledged $32.5 million and
$16.25 million, respectively, for a project to create a landmass around the current Essroc Quay in Toronto that will stabilize the area shoreline under flood conditions. The Port Lands of Toronto “filling and naturalization” flood protection project is expected to start October 1. The announcement is part of the Clean Water and Wastewater Fund.
CHAMPLAIN-RICHELIEU FLOOD RISK UNDER STUDY The governments of Canada and the United States have asked the International Joint Commission (IJC) to “explore more fully the causes, impacts, risks and potential solutions to flooding in the Lake Champlain-Richelieu River basin” in Quebec, New York and Vermont. The IJC is mandated to prevent and resolve border disputes, primarily those concerning water quantity and quality. The work will involve the evaluation of the causes and impacts of past floods, particularly a 2011 event; assessing the possibilities offered by floodplain best management practices; evaluating possible adaptation strategies to the expected future variability in the water supplies; and making recommendations for implementing a flood inundation mapping system for the area, among others. The governments are requesting that the IJC complete these activities within five years and prepare
an initial workplan within six months. The Richelieu River flood in spring 2011 was “arguably the worst overland inundation in southern Quebec since Confederation and Quebec’s worst natural disaster since the Saguenay flood in 1996,” Global Affairs Canada reported. “In at least 20 municipalities, waters inundated streets up to a kilometre from the riverbanks,” it adds.
Reinsurance GLOBAL REINSURANCE LOSS RATIO UP 7.1 POINTS The loss ratio in the global reinsurance market, for the first half of 2016, was 63.3%, up 7.1 points from 56.2% in 2015 and two points higher than the fiveyear average of 61.3%, A.M. Best Company Inc. notes in its latest annual global reinsurance segment review. The report includes a list of Top 50 Global Reinsurance Groups, ranked by unaffiliated gross written premiums in the previous year, in both life and non-life. This year and last year, Munich Re, Swiss Re and Hannover Re ranked first, second and third, respectively. SCOR ranked fourth this year, up from fifth in 2015. Berkshire Hathaway dropped from fourth to sixth place. A.M. Best counts the Lloyd’s market as one reinsurer. The Lloyd’s market rose from sixth place in 2015 to fifth place this year. October 2016 Canadian Underwriter
11
Canadian P&C Insurance: A great many players. In perfect harmony with millions of Canadians.
2016 IBAC Full Partners
SUPPORTERS: SGI Canada, Everest Participants: Lloyd’s Underwriters, Pafco, Aviva, Northbridge A great many insurers underwrite the security and peace of mind of literally millions of Canadians. And they do so with great professionalism, with unimpeachable integrity, and truly Canadian compassion. These are the values shared with each other and with the 36,000 brokers represented by the Insurance Brokers Association of Canada, and it is this mutual respect and support that creates such harmony in our industry. For this, we thank you.
Proud Supporter of Brokers Displaying this Symbol
PROFILE
Broker Management Greg Meckbach Associate Editor
Traci Boland, incoming president of the Insurance Brokers Association of Ontario, hopes that company and broker management systems will soon work together. Educating insurance professionals about self-driving cars, eliminating the double entry of data into computer systems and asking Ontario brokers what they want from their provincial association are among Traci Boland’s goals as incoming president of the Insurance Brokers Association of Ontario (IBAO). IBAO officials “have just started talking” about an educational program around self-driving cars, reports Boland, currently the association’s first vice president. “The IBAO will be co-branding with a different educational platform to bring this to the insurance industry,” she says. 14 Canadian Underwriter October 2016
Despite the progress in recent years on broker management systems (BMSs), some brokers still find they need to enter the same data twice. “The ease of doing business, for our brokers’ front-line staff, is not even a statement in their vocabulary any more,” says Boland, who by day works in London, Ontario as a partner at Ontario West Insurance Brokers. “These front-line men and women, who actually have to service the consumers, are spending more time with double-data entry — going into each company’s portal, ensuring that their BMSs are up to date so that nothing is missed for the consumer.” With some carriers adopting software from Guidewire Software Inc., brokers are “now in a better position to be able to communicate with the platforms that are out there with the companies,” reports Boland. “But to complete it, we need integration. Brokers need to be able to respond to our clients’ needs at the same time and speed that our competitors, the direct writers and the banks, can. Right now we are not able to do that. The technology is out there, but it’s so slow to come, and partly it is because of the BMSs and the
companies not being able to work together.” Another technology issue for Ontario brokers is the availability of systems that enable online quoting and binding, she suggests. “We need to be able to adapt faster, build the products and build the technology so that our brokers can help the consumers.” So far, 2016 has been “very difficult” for some insurance brokers, with new residential water policies and the changes to auto that took effect for accidents occurring on or after June 1, she suggests. Overland flood coverage was generally unavailable to Canadian residential property owners until 2015. Early that year, The Co-operators Group Ltd. launched its Comprehensive Water Endorsement in Alberta and Aviva Canada Inc. launched its overland water endorsement in Alberta and Ontario. The Co-operators has since rolled out Comprehensive Water in Ontario as well. Among the carriers that are also now providing overland flood coverage are RSA Canada, Economical Insurance, Gore Mutual Insurance Company, Pembridge Insurance Company and Optimum General. Both RSA Canada and
Aviva Canada offer flood coverage as an endorsement to their sewer back-up polices. Wording is far from standard. With The Co-operators, for example, its endorsement covers a river body overflowing its banks, water that overwhelms the natural or built infrastructure’s ability to carry it away and sewer back-up. For its part, RSA Canada gives homeowners the option
“There is not one (residential overland flood) product there that is the same for everybody.” of buying sewer back-up without the Waterproof coverage, but its new sewer back-up wording is more restrictive. “There is not one product there that is the same for everybody,” Boland says. Other major recent changes affecting Ontario brokers include auto coverage. “We were answering to clients as to why they hadn’t seen a 15% reduction before auto reform,” she says of brokers at Ontario West Insurance Brokers, alluding to the Automobile Insurance Rate Stabilization Act, which took effect in August 2013.
That law mandated an “industry-wide target reduction” by 15%, of the “average of the authorized rates that may be charged by insurers” for private passenger auto, with a two-year target. In their rate filings, insurers had to “propose rates and a risk classification system that contribute adequately to the achievement of” the 15% target. “We still were not seeing the reduction that was promised by the government for our clients, and so [clients] are calling on that,” Boland says. Over the past several years, the Ontario government introduced a number of measures that are aimed at addressing auto claims costs. For accidents occurring on or after June 1, 2016, the mandatory coverage for catastrophic impairment no longer has two separate $1 million limits. The limit is now a combined total of $1 million, for attendant care, medical and rehabilitation. For non-catastrophic injuries, the mandatory coverage that consumers must purchase has been reduced to a $65,000 limit for medical, rehab and attendant care expenses. Before, the limits were $50,000 for medical and rehab, and $36,000 for attendant care. “Auto reform came up and
Photo: Peter Tym
PROFILE
we had to do the training on that, we had to understand all the codes and all the process for that,” Boland says of her brokerage, where she has worked for 15 years. Raised in London, Boland was a synchronized figure skating coach in the United States. She returned to Canada in September 2001. “I had to make the decision as to whether I was going to go for another visa again, working with sports, or if after September 11 (2001) if it was time to stay home,” she recounts. “I made the decision that it was actually time to stay back in London and I started working again in my dad’s insurance
brokerage,” she says. Boland obtained her licence in 2002. The following year, she attended an IBAO Young Brokers Council (YBC) conference. She was a YBC territory leader for three years and subsequently served as YBC vice president, president and chair. Boland then served on the IBAO board for three years, before taking on the position of second vice president and now first vice president. “We have a survey that’s going out to all our members and stakeholders about what people are looking at from the IBAO,” she reports. “We really want to be listening right now to what brokers
need from us and ensure that we are delivering on the actions that they have asked us to do,” Boland emphasizes. IBAO has had several leadership changes. Colin Simpson — who previously led Kingsway Financial, Intrinsync Insurance Solutions and Independent Broker Resources Inc. — is now IBAO’s chief executive officer. “The IBAO is now in a position of strength under the leadership of Colin Simpson,” contends Boland. “I think that we are going to be able to move forward in a positive way. We are heading into 2017 with our longrange plan,” she adds. October 2016 Canadian Underwriter
15
Builder’s
Timothy McGurrin
Partner, Miller Thomson
RISK
In light of a recent Supreme Court of Canada ruling on a builder’s risk policy, insurers can anticipate that court decisions involving disputes over standard form insurance contracts are more likely to be appealed. On September 16, the Supreme Court of Canada rendered its judgment in Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co. The decision provides new guidance on principles of contractual interpretation and eliminates the doctrine that appeal courts should show deference to trial courts when dealing with the interpretation of standard form contracts. Examining a faulty workmanship exclusion common to builder’s risk insurance policies in particular, it was held that such clauses exclude only the cost of re-doing faulty work and not necessarily physical or resulting damage caused by such work. Bristol Cleaning was hired to clean windows prior to completion of construction of the EPCOR tower office building in Edmonton. At the early stages of the project, an “all risks” insurance policy had been obtained to run until
16 Canadian Underwriter October 2016
the completion of construction, covering the owner, contractors, sub-contractors and others involved. The windows were scratched during cleaning, resulting in a claim against the policy for the cost of replacing the windows, which was estimated at $2.5 million. The insurers (one of whom was Northbridge) denied the claim. QUESTIONS OF FACT OR LAW In its ruling in Sattva Capital Corp. v. Creston Molly Corp. — which was not a disputed insurance claim, but did involve commercial contract interpretation — the Supreme Court of Canada advised that the historical approach of determining the legal rights and obligations of parties to a written contract as a question law should be abandoned. This approach was described as having originated in England at a time when there were both frequent civil jury trials and widespread illiteracy. Out of necessity, the interpretation of a contract was deemed a question of law, rather than a question of fact for a jury to decide. As often only the judge could read, the interpretation of a document had to be left to that judge alone. More recently, when hearing breach of contract lawsuits, there has been a tendency for courts to consider not only the technical rules of contract construction, but to also consider the actual intent and understanding of the parties to those contracts.
In Sattva, recognizing the importance of the circumstances surrounding a contract and the objective of identifying the actual intent of the parties, Justice Marshall Rothstein wrote the following: “Contractual interpretation involves issues of mixed fact and law as it is an exercise in which the principles of contractual interpretation are applied to the words of the written contract, considered in light of the factual matrix.” For the process of contractual interpretation, this guidance was an important development. Additionally, while decisions of law are subject to appellate review for correctness, an appeal court is expected to defer to a decision by a lower court on a question of mixed fact and law, unless there is a palpable and overriding error on the part of the lower court. Therefore, for most appeals involving the interpretation of a contract, Sattva changed — or at least solidified — the standard of review as overriding and
palpable error rather than correctness. It became harder to successfully challenge trial decisions in such contract cases. In Sattva, Justice Rothstein commented that it may be possible to isolate an extricable question of law from within a question of mixed fact and law but directed caution in doing so and warned: “The close relationship between the selection and application of principles of contractual interpretation and the construction ultimately given to the instrument means that the circumstances in which a question of law can be extricated from the interpretation process will be rare.”
BROAD COVERAGE In Ledcor, the high court acknowledged that appellate courts have disagreed on whether or not the instruction from Sattva meant overriding and palpable error was the appropriate standard of review for “standard form contracts.” However,
writing for the majority, Justice Richard Wagner determined the issue by holding that where an appeal involves the interpretation of a standard form contract, the interpretation is of precedential value, and there is no meaningful factual matrix that is specific to the parties to assist the interpretation process, then the question is best characterized as a question of law and subject to review for correctness. Respectfully then, it appears that in so far as standard form contracts are exceedingly common both in insurance and other industries, instances of contractual interpretation being subject to a review under the standard of correctness, will not be so rare as one might have believed reading Sattva. This lack of deference to the trial decisions in such cases lends itself to an increased frequency of appeals. The policy of insurance at issue in Ledcor provided coverage for all risks of di-
A catastrophic event
rect physical loss or damage to the property undergoing construction, subject to certain exclusions. The particular, but typical, exclusion and exception clause at issue included the following: “This policy section does not insure: ...The cost of making good faulty workmanship, construction materials or design unless physical damage not otherwise excluded by this policy results, in which event this policy shall insure such resulting damage.” Interestingly, the Alberta Court of Queen’s Bench trial judge concluded that competing plausible interpretations of the clause made the policy ambiguous as to whether only the cost of the cleaning work or also the cost of the window replacement fell within the coverage provided by the policy. The issue was resolved at trial by applying the rule of contra proferentem, favouring the insureds. In contrast, Alberta’s Court of Appeal found the damage to the windows to be excluded from coverage, ruling that the exclusion clause was not
More recently, when hearing breach of contract lawsuits, there has been a tendency for courts to consider not only the technical rules of contract construction, but to also consider the actual intent and understanding of the parties to those contracts. ambiguous. However, its creative new test — devised to draw a dividing line between the cost of making good faulty workmanship and the physical damage that was covered as resulting damage — was entirely rejected as unnecessary by the Supreme Court of Canada. Carrying forth the governing prin-
ciples of interpretation applicable to insurance policies — summarized in 2010 in the Supreme Court of Canada decision in Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada — the analysis in Ledcor begins with the general proposition that where contractual language is unambiguous, effect should be given to the clear language, reading the contract as a whole. Where there is ambiguity, however, the general rules of contractual interpretation are brought to bear — finding an interpretation consistent with the reasonable expectations of the parties within the commercial atmosphere and with consistency to interpretations of similar policies. Only if ambiguity still remains is the doctrine of contra proferentum to be used to construe the policy against the drafter. Finally, the insurance sector-specific rule must also be considered — coverage clauses are to be interpreted broadly and exclusion clauses narrowly.
demands a decisive response. FirstOnSite has the leadership, resources and ability to manage any disaster event. Since 2007, our work has been our proof. From devastating wildfires in Fort McMurray and Slave Lake to flooding in Southern Alberta, from windstorms in Southern Ontario to Atlantic Hurricanes and an F3 tornado in Goderich, Ontario, our CAT experts have mobilized and successfully led large scale responses across the country. We are committed to providing rapid and superior disaster restoration services in times of emergency.
Visit us at firstonsite.ca/CATresponse for more information. Or call our emergency hotline at 1.877.778.6731
considered vacant and covered by the policy. An insurer is entitled to identify how the premises are being Insurers typically elect for a named-perils policy, as opused. If a vacant building represents a materially different risk, posed to a broad form wording, as this removes coverage as it increases the likelihood of loss, defining the term is imfor key concerns such as water-related losses and theft with perative for applicants. Interpreting the exclusion clause to preclude from coverage resulting damage. That said, pinning an exact definition on the word “vacant” only the cost of redoing faulty workInaligns commercial addition,with vandalism is typically excluded by endorsecan be elusive at times. ment, as is illegal drug cultivation. Simply put, there are multiple factors that might indicate reality and sensible results, as well as the parties’ reasonable The building valuation is often restricted and amended to whether a structure is rightly termed occupied, unoccupied or expectations, while the cash-value insurance into an actual basispolicy and some insurers elect not to vacant. For instance, the difference between the not termstransforming “vacant” cover equipment. and “unoccupied”ais construction often related to thewarranty. occupant’s intention As described by the International Risk Management to return, notes the Insurance Institute of Canada publication, Institute, the vacancy permit endorsement — worded as a C12 Insurance on Property. warranty by some carriers — “suspends some or all of the Therefore, to define a risk as vacant, both its unoccupied status theofreview, the court confirmed that an insured less, ambiguous withthat different interpretations. coverage restrictions applypossible to buildings that have been andTo thefurther intention the property to permanently remain as such has the onus of first establishing a claim is within coverage Turning to the general principles of contract vacant for more than a specified time period.” interpretamust be considered. before shifts to insurer that an tion, theconditions, majority noted that thefound overall ofpermit such These commonly in purpose a vacancy In the the end,onus eachthen situation is the unique andtoallestablish circumstances exclusion applies, and then if necessary, back to an insured to builder’s risk policies as providing broad coverage to endorsement, are designed to ensure the property is still must factor into defining a building’s occupancy status. A few prove any exception to the exclusion. construction projects “which are singularly susceptible adequately maintained in order to reduce the chance of loss. questions that might assist in this endeavour are as follows: In Ledcor, the majority of the Supreme Court of Canada retoFor accidents and errors... permit in exchange relatively high example, a vacancy might for require the insured • Is the building deprived of contents and equipment? jected the Alberta Court of Appeal’s finding that the exclusion premiums... provides certainty, stability, and peace of to securely lock all windows and doors, remove all rubbish, • Is the building habitable in its current state? must exclude some physical loss from coverage or it maintain mind.” The analysis confirms thatutilities, all-risk coverage under heating and electrical and consistently • clause Are all utilities still connected and operational? would be redundant. The majority reminded that in Progressive, a builder’s risk policy is intended to be broad, and the visit the property within a specified time period (anywhere • Is the building being used (or is it able to be used) for its inthe Supreme Court of Canada stressed that “perfect mutual faulty workmanship exclusion narrow. from every 48 hours to every seven days). tended purpose or is it only visited for a transitory purpose? exclusivity andanthe initial grantdefinition of coverInterpreting exclusion to period preclude Some insurersthewill limit theclause policy to from three covor six Ultimately,[between the courtsexclusions will decide appropriate age] in an insurance contract is not required.” erage only the cost of redoing faulty work aligns with months, with many not agreeing to extend these policies for based on the specific nuances of each case. However, the ften Moving the majoritybasis opined although language the risks commercial sensible results, as well as the parthat havereality been and vacant for two or more years. placed on aon, named-perils with higher the rating, largerofdeexclusion slightly favoured the insured, was, nonetheties’ reasonable notuncommon transforming Depending onexpectations, the situation,while it is not forthe carductibles andclause a specific endorsement allowing theitpremises to be insurance policy into a construction warranty. riers to bend their internal rules. There is also no shortage the majority also rejected the insurer’s of Interestingly, companies, including managing general agents, willing argument (favoured by Alberta’s Court of and able to provide some form of coverage. Appeal) that accepting granting coverage would However, an the interpretation longer a property sits idle, the more difpromote commercially unreasonable behaviour by influficult obtaining coverage is likely to be. This is an especially encing how work is divided among contractorson pressing concern where an insured mayvarious have a mortgage on a project in an effort to maximize coverage — inproof esof Canada has launched! the property, since the mortgagee will likely require sence providing an incentive to divide up the work as of insurance to maintain the financing. finely as possible. The majority held that it would be unMoreover, as the length of the vacancy is extended, carrireasonable to expect owner or with general to ers often become moreanconcerned the contractor moral hazards Brad Cantwell, President of EPS Settlements consider this as a particularly relevant factor in deciding Group, and Bob Nigol are pleased to presented, a concern that is justifiably heightened with the announce a partnership through the launch how to allocate work.provisions in provincial regulations. of EPS Settlements Group of Canada. “innocent co-insured” It deserves note therecovery SupremebyCourt of Canada was EPS Settlements Group is the flagship These provisionsthat allow an innocent insured company of the oldest and largest structured not unanimous in these views. While agreeing with the settlements organization in North America. on the policy even where another insured on the same majority’s disposition of the case, Justice Thomas CromBob Nigol is a former owner and President and policy is found to have acted criminally, for example, by CEO of Henderson Structured Settlements well, in separate reasons, expressed doubt the interand now the Managing Partner of EPS committing arson.In the United States, thethat National Fire Settlements Group of Canada. pretation of standard form contract as so removed from Protection Association (NFPA) reports that 43% of vacant Together Brad and Bob wish to invite past and prospective clientele to engage in what the consideration of factual context to warrant an exassuredly will be the very highest standard of service achievable in the structured building fires were intentionally set. Moreover, in unsecured settlements market in Canada. ception from the general rule in Sattva. Justice Cromwell properties, 57% of the fires were intentional compared to found trial properties, judge did notes not err finding thebyclause 31% in the secured thein2009 article NFPA, ambiguous. Vacant Building Fires. The protection result for insurers is the for increased liabilFire systems, evenpotential when they are still connectity under builder’s risk policies, at least with respect to poled and active, are often ineffective where a fire is caused (289) 769-3480 | (877) 819-8960 icies written in the present common form, and a further by the rehabilitation to the outside of the building since most www.epscanada.com strong precedent rule that courts will maximize automatic systems for are the designed to suppress fires originatcoverage ing withinand theminimize structure.exclusions in cases of uncertainty. Moreover, modestresult deterrence to building appeals promised Victoria Vancouver Calgary Winnipeg Windsor Hamilton London A fire canthe certainly in a total loss. Firesby are Toronto Ottawa Montreal Charlottetown Halifax the higher standard of review in Sattva no longer to often caused by unannounced renovations to theapplies structure, the interpretation of a standard form contracts.
EPS Settlements Group
OFFICE LOCATIONS
20 Canadian Underwriter October 2016 20 Canadian Underwriter October 2016
• Commercial General Liability
• Umbrella & Excess Liability
• Environmental Liability
• Professional Liability
• Marine and Logistics
• Lifesciences and Clinical Trial Liability
• Security and Protection Industry • Directors and Officers Liability • Renewable Energy
Montreal : 1-855-845-7861
• Product Recall • Property, Crime & Inland Marine
Toronto : 1-877-603-7864
www.suminsurance.ca SUM Insurance Can. Underwriter 9_16.indd 1
www.morinelliot.ca
9/21/16 9:58 AM
42nd Annual RIMS Canada Conference Calgary
Bracing for Change Angela Stelmakowich Editor
Attendees of the 42nd Annual RIMS Canada Conference had the opportunity to learn about the most pressing (and persistent) risk management issues facing professionals, their partners and the industry itself. Common to all, though, is a need to get educated and be flexible for what may unfold in future. Resilience, the theme of the 2016 RIMS Canada Conference, could likely find no more welcome and knowing host than Calgary. As the home of the majority of Canada’s Top 10 insured losses for natural disasters ever, Alberta served as a fitting venue to discuss all manner of risk management: from resiliency to mergers and acquisitions, business interruption and flood coverage.
RESILIENCY SHOULD BE EVERYONE’S GOAL Every organization, regardless of size or sector, can be hit by some sort of disaster so each needs to ensure steps are taken to become resilient,
22 Canadian Underwriter October 2016
Darius Delon, chair of the RIMS Canada Council, suggested during the opening ceremonies of the 2016 RIMS Canada Conference. Emphasizing that no one is exempt, Delon told attendees that when risk managers develop their teams, these should include incident response, emergency response planning and business continuity planning expertise. Practising both incident response and business continuity on a regular basis “is critical to the continued success of your resilience,” he argued. “Being prepared for these eventualities that we don’t want to have happen is a hallmark of resilience,” he added. Calgary Mayor Naheed Nenshi told attendees “it’s incredibly important” for governments and quasi-governmental agencies “to be able to think about the appropriate way to manage risk, the appropriate way for us to think about what risks should we be taking, how should we be taking it.” Asked Nenshi, “Is the risk of loss so infinitesimally small that it’s preventing us from making serious investments or doing serious things to improve the quality of life for people in our community?” The job of risk professionals is “to not only control or mitigate risk, but to embrace it, and to enable risk-taking as a natural part of doing business and align them with the organization’s strategy,” Julie Pemberton, president of Risk and
I am your building. Protect me. I was once a blueprint but am now multiple stories of solid steel. I am being built by world-class design, engineering and construction firms. I rely on bulldozers, pipe layers and tower cranes to work every day. I want more than insurance. I want the kind of insight that comes from decades of experience insuring complex infrastructure and construction projects. A level of protection and personal service that only Chubb provides. Not just coverage. Craftsmanship.SM Not just insured.
Chubb. Insured.
SM
Š2016 Chubb. Coverages underwritten by one or more subsidiary companies. Not all coverages available in all jurisdictions. ChubbŽ, its logo, Not just coverage. Craftsmanship.SM and all its translations, and Chubb. Insured.SM are protected trademarks of Chubb.
chubb.com
Insurance Management Society (RIMS) Inc., told attendees. “Risk mitigation is not cheap, it’s not easy, but it’s critical. It’s critical in a world of climate change, it’s critical in a world where we think about emergencies and risks in new ways and it takes hard work,” Nenshi emphasized.
M&A COULD SUPPORT DEMAND FOR MORE R&W COVER The future looks good for mergers and acquisitions (M&A) activity, which will likely also fuel demand for representations and warranties (R&W) insurance, André Legrand suggested at the 2016 RIMS Canada Conference. There are some current factors — the United Kingdom Brexit vote and the United States presidential election were specifically noted — that have created instability not only in the U.K., but very much in Canada, Legrand, a senior partner with Norton Rose Fulbright’s Mon-
treal office, said during the session, The Mergers and Acquisitions Insurance Explosion. “These two things are obviously temporary, but do have an effect on M&A activity and it is expected once these two factors have been dealt with, the future looks good in terms of M&A activity,” he told attendees. R&W insurance provides buyers and sellers protection from financial loss if there are any misrepresentations or inaccuracies in representations or warranties. In the short term for Canada, Legrand pointed out that a few issues pop up that might bolster R&W insurance demand. For example, he cited “transactions in Alberta’s energy market, which could boom given the number of companies in financial difficulties.” In addition, he noted, “on the horizon, analysts are predicting a high level of activity in the marijuana sector given the legalization of the product.”
www.sedgwickcms.ca 888.601.6228
Legrand’s expectation is certain organizations, pharma companies, will look to “move in now that the fear factor, whatever factor, is slowly shifting away.”
GROWING GAP BETWEEN INSURED AND ECONOMIC LOSSES A dramatic loss scenario around disaster events is developing globally, contributing to a widening gap between insured and economic losses, Alex Kaplan, senior vice president of global partnerships for Swiss Re, suggested during a session at the 2016 RIMS Canada Conference. “If you tie urbanization together with globalization and the onslaught of potential for climate change, it creates a very dramatic loss scenario,” Kaplan said. Though events have increased in both severity and frequency, that is likely only part of the story, he suggested. “Really, what’s driving this is the change in the exposure,” he explained, noting it is “the massive accumulation of assets in the
most disaster-prone areas (for example, by water) that are leading to these losses,” Kaplan said. “The alarming trend is the divergence between the insured portion and the total economic losses over time,” he told attendees of the session. This same divide is also playing out in Canada, he suggested, noting insurance losses from events for the last five years have been in excess of $1 billion “and that continues to climb.” Canada sees an average of 20 to 25 large or medium-scale events annually, Kaplan reported. “Again, a lot of it has to do with the concentration of exposure,” he pointed out. “We have a new fiscal reality that changes our risk retention, our risk appetite,” Mark Day, executive director of risk management and insurance at Alberta Treasury Board and Finance, noted during the session. Despite challenges and the new fis-
cal reality, “a lot of lessons have been learned from recent disasters,” such as the Slave Lake, Alberta wildfire in 2011, the southern Alberta flooding in 2013 and the Fort McMurray wildfire in 2016, Day said. As it stands, “mitigation is a key driver for the province. Most costs are not covered by the DFAA (Disaster Financial Assistance Arrangements program) and can be the most significant spend,” he told attendees.
BUDGETS MUST NOT TRUMP RESILIENCY PLANS Resiliency plans are unlikely to ever be perfect, but they are an increasingly important element of an organization’s response to crisis, attendees of the 2016 RIMS Canada Conference heard. During the plenary session, Resilience: 9/11 and how it changed the industry, Neil Harrison, global head of claims for Aon Risk Solutions, and Alan Kurth,
www.vericlaim.ca 888.601.6228
risk manager for Marsh & McLennan Companies, shared their personal experiences and insights following the terror attacks in New York City September 11, 2001. Harrison said Aon lost 190 colleagues, while Kurth reported that Marsh lost 295 colleagues. Despite the clear need for — and the value of — resiliency plans, “the issue that we all struggle with as risk managers is there’s budgets,” Kurth told those assembled. “You have to figure out what are the most critical business assets and you have to deploy the resources where it makes most.” One concern is getting “funds to allocate to something where your management would rather take it and invest it into something that can make money,” Kurth suggested. “None of that is going to happen if anything happens to the fort. You really have to spend the time and have the plans to focus on the critical aspect of your business for when that
ng prinments for
e regardnications selected
of comnsumers oing pripersonal
dened by , unique, order to cuments rd, comure long-
ty and dustry, allow age to vidual and be her vice .
Regulating Oil Tank Spills
both ofLetter coverage and of communicaThe components are in place, and ness resiliency plans broad. “If you crisis he emphasized. to thedoesishappen,” tions methods, maintained. great efficiencies could be gained by the make them too specific, going to “Any company, any firm, any organi- Michael Editor thatyou’re we reduce With the use of eDocs well-established, industry by Freill’s seizingproposal the opportunities yourself not being able to think out zation can only spend its dollar once,” oilfind spills byinoffering homeowners premium the technological backbone needed to also encompassed e-delivery. of the boxonand you have topolicies be adaptable Harrison pointed out. “It’s sometimes reductions their deliver electronic customer copies to broStill undecided is theinsurance service’s design whenthan it happens,” he said. easy to invest in something that’s perhaps rather through government regulation kers already exists. BMSs are building the and whom it will benefit most. The big As well, testing critical. “Although a little more exciting than the risk man- sounds theory.is(‘Oil Change,’ functionality needed to package policy question is:good Will in insurance stakeholders all the Freill, testing in the world is probably agement arena is perceived Underwriter, Michael Bill Adams to be if we documents and broker communications execute e-deliveryCanadian to best serve clients not going to come out perfect when haven’t been Vice-President, through an event recently. 2009)right The reality, unfortunately, Atlantic, and August together and export them in the formats allow their to choice to reyou have your crisis, you will be better So, complacency, to me, is a big risk.” Insurance of Canada that the math just doesn’t add up for required by electronic deliveryBureau systems. mainisparamount? Kurth’s advice would be to make busi- off when you’re faced with it,” Kurth said.
On Target Together Since 1981, RIBO has worked closely with brokers to help serve and protect the public. With more than 1,200 brokerage firms registered, employing approximately 16,000 individual registered brokers – RIBO’s mission has never been stronger.
entatives, e content nd com-
onsumer in claims ctly with ific conhat con-
ENTIAL o protect y streamuring that d and the choice,
Registered Insurance Brokers of Ontario
401 Bay Street, Suite 1200, P.O. Box 45, Toronto, ON M5H 2Y4 (416) 365-1900 Or 1-800-265-3097 Fax: (416) 365-7664 www.ribo.com
To risk managers, Harrison said he is not us are yet spending as those “sure buyingany the of policies. much time as we can scenario planning Only a small percentage of the premium and testing policies.” dollar is allocated for claims resulting from That said, “have we as an industry oil leaks and spills from tanks. Any dis- progressed? Overall, are we better prepared? count insurers could offer for replacing or The answer is yes,” he noted. “Can we risk-proofing older oil tanks would be neglideclare victory? The answer is no.” gible compared to the cost of the upgrades or purchase of a new tank. The discount TAKING STEPS TO ADDRESS simply would not provide a financial incenBUSINESS INTERRUPTION tive significant enough to encourage homeAssuming certain costs ofmay good owners to improve the safety theirbe oil atanks. thing for companies experiencing a busiThis is why Insurance Bureau of Canada ness interruption (BI) and looking to get (IBC) maintains that government regulation operations back up and running, Glenn is the right approach. It should be noted Nadworny, claims adjuster with Crawthat IBC rarelya advocates for increased ford Global Technical Services, suggestregulation — on any issue — because it ed at the 2016 RIMS Canada Conference. is usually not the most effective solution. is going to be some costs that But“There in the case of maintaining oil tank the insured incurs during and after the quality, a certain degree of government loss, which are both necessary enforcement appears to be the bestand wayprudent for them to reduce their loss of to make a difference. property and interruption of their Prince Edward Island is the first and,busiso ness also province to continue their operafar, onlyand Atlantic to enact legislations in effort as normal a manner possition in an to reduce leaks andasspills ble,” Nadworny explained to attendees from oil tanks. Though critical of the conof the session, Business Interruption: cept of government regulation, FreillMinimizoffers ing the cost of business interruption losses. several insights that the P.E.I. data has “These costsFor areexample, understood by insurbrought to light. the data ers to be beneficial in reducing the ulhelps to identify the best style and matetimate business loss to the insured,” rial of a tank, as well as the ideal lifespan he pointed after whichout. a tank should be replaced. “Some ofother the key to regulaminimize If there are waysitems that the potential business interruption loss is tions can be improved, IBC is happy to getting other professionals involved work with the government to make the sysearly in the process,” emphasized tem better. Regardless, P.E.I. should be Jay Strano, managing director Crawford praised for taking leadership on thisofissue. Forensic Accounting. Freill calls on the industry to collect oil have “a leakStrano claimsemphasized data. In fact,the IBCneed has to been dialogue with the insured about collecting industry data for all four of what’s the going provinces on with their Atlantic sincebusiness.” the beginning of All When potential riskscompiled associated with the 2008. we have sufficient loss should be outlined based data to reach statistically meaningfulon the specific on the results, we insurance will use the policy findingsand to help business environment, notes a slide governments implement or fine-tune from the presentation. consider reregulation to ensure Factors oil tank to integrity. garding the insured’s business include It is true that insurance-driven financial products and services; production incentives can be a motivator for homecapacimity (manufacturing versus buildprovements. In the case of oil retail); tanks, howing the capacity; marketing experience ever, industry can haveability, the greatest and management depth; contracts, impact by working with governments to leasimes, etc.; seasonality, location, operating plement regulation that will help homeowners hours,theetc.; offuel. business; reduce risk multiple of storing lines heating
and ability to make up sales.
2644Canadian Underwriter October 2016 Canadian Underwriter October 2009
October 2014 Canadian Underwriter
41
Illustration by Lars Rudebjer threeinabox.com
WHEN THE UNEXPECTED HAPPENS,
WE’RE WE’RE READY
WHEN THE UNEXPECTED HAPPENS,
READY
WE ARE EQUIPPED TO RESPOND TO YOUR NEEDS 24/7.
We are the single-source solution with the expertise and resources to mitigate damages and minimize losses with superior results. You can depend on us to handle every aspect of the property repair efficiently, effectively and with care. Call the brand you can trust to deliver all your We are the single-source solution with the expertise and resources to mitigate damages needs. andrestoration minimize losses with superior results. You can depend on us to handle every aspect
WE ARE EQUIPPED TO RESPOND TO YOUR NEEDS 24/7.
We are the single-source solution with the expertise and resources to
of the property repair efficiently, effectively and with care. Call the brand you can trust to mitigate damages andneeds. minimize losses with superior results. You can deliver all your restoration
depend on us to handle every aspect of the property repair efficiently, effectively and with care. Call the brand you can trust to deliver all your restoration needs.
1-800-RESPOND servicemasterrestore.ca
ad right size copy.indd 1
15-01-19 9:21 AM
Material Disclosure In a ruling in favour of SGI and Galon Insurance Brokers, a Saskatchewan court found that a plaintiff knew, or should have known, that his decision to rent to tenants was material to the risk of insuring his home.
Partner, Robertson Stromberg LLP Robertson Stromberg is a member firm of The Arc Group of Canada, a network of independent law firms across Canada..
28 Canadian Underwriter October 2016
and took the step of ensuring, in writing, that the insured understood the importance of providing accurate information by asking important questions in a number of different ways. The court also found that the broker was not negligent in failing to provide the plaintiff with a copy of the policy booklet once the original meeting finished because there was no evidence to suggest such failure had an impact on the plaintiff’s loss. The court concluded the plaintiff knew, or should have known, that his decision to take in paying tenants was material to risk because the many questions put him on the application form made it clear that the issue of renters was important to the insurer.
BREACH OF STATUTORY CONDITIONS In its defence, insurer SGI Canada relied upon breach of two of the statutory conditions in denying coverage. The plaintiff argued that the denial amounted to a breach of contract on the basis that each statutory condition relied upon spoke to circumstances that “are material to be made known to the insurer in order to assess its risk” (the misrepresentation statutory condition) or “any change material to the risk and within the control and knowledge of the insured” (the material change statutory condition). In a novel argument, the plaintiff took the position that he did not know that having pay-
Illustration ©Remy Simard, i2iart.com
Jennifer Pereira
A recent Saskatchewan court ruling against a homeowner, over a disputed claim, offers some food for thought to underwriters familiar with a frequently-discussed distinction in insurance law. There is a difference between conduct that represents a breach of a policy condition and conduct that causes a loss to fall outside the insured risk. On June 27, the Provincial Court of Saskatchewan, Civil Division, released its ruling, Zheng v. John Galon Insurance Services Ltd. Jialong Zheng had purchased a habitation policy, written by SGI Canada, from Galon Insurance Brokers. In claims disputes, the consequence of a breach of condition may be quite different from the consequence of a misrepresentation. Zheng’s home was damaged when a fire broke out. Subsequent investigation by SGI revealed that he had three paying tenants living with him at the time of loss. SGI denied coverage under his “owner-occupied” policy of home insurance on the basis that his decision to rent his premises to a number of tenants constituted both a misrepresentation and a “change material to the risk within the control and knowledge of the insured.” With respect to Zheng’s claim against the broker, the court found that there was no breach in his duty of care to the plaintiff. In fact, the court found that the broker exceeded the standard of care required of him by satisfying himself that the plaintiff understood the application process
Illustration ©Remy Simard, i2iart.com
Let’s Go Forward Together
Cameron
Commercial Lines Underwriter
We’re building genuine relationships with our broker partners by investing in talented people like Cameron. We’re working hard to bring you competitive products like our commercial auto lines, where we have new reduced rates for our Fleet and IRCA coverages. We’re also using new platforms and creating award-winning technology like uBiz to provide practical, real-world digital tools for you. TO LEARN MORE, VISIT OUR BOOTH AT THE IBAO CONVENTION OR CONTACT YOUR BUSINESS DEVELOPMENT MANAGER.
goremutual.ca
ing tenants increased the risk that might be considered by the insurance company, and that having never received a statistical data analysis that shows tenants are a higher risk than an exclusively owneroccupied home, he could not have known. The plaintiff took his argument further by stating an insured need only disclose a material change in risk if he or she is subjectively aware of the fact that the change in risk would, in fact, be material. The plaintiff’s argument on this issue merits a review of recent Canadian care law as to when non-disclosure or disclosure is “material.”
on its view that an insurer should not be allowed to benefit from a problem it has created through poor drafting of its application forms.” Thus, the fact that a particular insurer regards a fact as being material does not necessarily determine its materiality in objective terms. An insurer can demonstrate the materiality of the misrepresentation in question where its own practices are in conformity with general industry standards.
DUTY TO DISCLOSE It is well-established that an applicant’s duty to disclose facts material to the risk extends only to past and present facts at the time the contract of insurance takes effect. However, insurers commonly insert terms into their policies obliging the insured to disclose material changes to the risk. This term is found in the statutory conditions pertaining to property, fire and automobile coverage in insurance legislation across the country. What constitutes a “material” misrepresentation is a question of fact in each case, and may vary according to the type of insurance in issue. The onus of proving materiality is on the insurer. The test of materiality is not what is material to the particular insurer, but what a reasonable insurer would have done or how a reasonable or prudent insurer would have reacted to the true facts. As noted in Brown & Menezes, Insurance Law of Canada, Volume 1, where an insurer fails to ask about a matter, the court may draw an inference that the insurer does not consider that matter relevant. The authors go on to observe that if a “customer answers truthfully according to a reasonable interpretation of a question which is ambiguous or inadequately worded, s/he will not likely forfeit a claim on grounds of misrepresentation or nondisclosure.” In a related footnote, the authors opine that cases where the insured succeeds “may turn less on the court’s perception that the information is not material than 30 Canadian Underwriter October 2016
This was considered recently by the Court of Appeal of New Brunswick in Thomas v. Aviva Insurance Co. Hubert Thomas, had purchased “multi-peril” homeowner’s insurance from the defendant insurer. The plaintiff’s policy incorporated Statutory Condition IV restricting coverage where material change in risk, known to and within control of insured, arose. In the application questionnaire, the plaintiff was asked what his primary heating source in residence was, and he truthfully answered electrical heating. The plaintiff subsequently installed a wood stove into his home. At no time did Thomas advise Aviva of its installation, nor was Thomas ever asked.
FAILURE TO INQUIRE
Expert evidence regarding materiality of undisclosed or misrepresented information is important in establishing industry standards. However, the fact that another underwriter might have declined the risk or charged a higher premium on the basis of the information provided by the applicant will not be relevant where the evidence is clear that the underwriter in question would not have done so. The evidence of insurance brokers and underwriters as to the materiality of a misrepresentation in an application for insurance is admissible. An insurer’s failure to ask a particular question may lead a court to find the insurer did not consider the question to be relevant. Conversely, the fact that a question is asked in the application form constitutes some evidence of its materiality. The applicant has a duty to use reasonable diligence to see that the answers are correctly written, and whether or not he or she read the form, the law generally treats him or her as having adopted it.
There was a fire at the insured’s home caused by the wood stove and coverage was declined on the basis that installation of the stove constituted material change in risk known to and within control of the insured. The court found that within the insured’s renewal documentation, Aviva “effectively advised [insured] that only the information provided in the original application was material to the risk.” As the insurer failed to make appropriate inquiries of insured and treated auxiliary heating sources as “inconsequential,” the court found that the insurer could not now deny coverage on the basis of material non-disclosure. In insurance law, generally it is important to distinguish between a condition of the contract and a restrictive definition of the risk assumed under the contract. There is frequently a problem in which events or behaviour of the insured fall into one or the other of the two categories. One is breach of condition; the other is conduct that takes the insured property outside the risk. These two concepts are very similar and are designed to achieve the same purpose: to limit and control the risk assumed by the insurer. Because of this inherent similarity it is easy to confuse the two concepts. However, it is important to avoid such confusion because the consequence, in insurance law, of a breach of condition may be very different from the conse-
Peace of mind coverage, day and night.
At A.M. Fredericks Underwriting Management Ltd., we believe that experience makes all the difference. That is why you can count on us to provide peace of mind coverage for all your clients’ needs. As one of Canada’s leading federally licensed Managing General Underwriters, our national expertise in niche and non-standard commercial liability, professional liability and property risks is second to none.
Visit us at www.amfredericks.com to learn more!
AMFUM_FP_8.125 x 10.75.indd 1
15-03-04 12:10 PM
quence of a misrepresentation. In the 2005 decision, Marche v. Halifax Insurance Co., the Supreme Court of Canada interpreted Section 171 of Nova Scotia’s Insurance Act (which is identical to Section 151 in Ontario). Here, the insurer denied a fire loss claim due to an earlier period of unreported vacancy that was unrelated to the loss, because the property was not vacant at the time of the loss. The insurer nonetheless argued the earlier vacancy constituted a material change in risk that voided the policy. The trial judge found that Section 171 relieved the insured of any policy breach because the insured had rectified the vacancy prior to the loss. The main issue argued in court was whether Section 171 applied to statutory conditions (it does), but the court also considered and found no reason to interfere with the trial judge’s finding that Section 171 applied. The Supreme Court of Canada did not lay down any specific test for determining whether Section 171 applied, but
32 Canadian Underwriter October 2016
noted it is not essential that a statutory breach be causally related to the loss. The court recognized the conflict that exists between the “draconian consequence of policy cancellation where the change material to the risk has been corrected” and the loss of insurer’s right to cancel the contract due to a material change in risk, and found in favour of the insured.
MATERIAL TO THE RISK The simplest distinction between “misrepresentation” and a “change material to the risk within the control and knowledge of the insured” is that a breach of condition cannot be unilaterally cured by the insured. If the insured has breached a policy condition, the insurer may void the policy even though the breach was temporary in nature and did not lead to any loss, even if the breach did not, in fact, alter the risk. Instead of voiding, the insurer may, if it chooses, waive the breach and continue with the policy. Returning to the Zheng decision, Sas-
katchewan’s provincial court found that the plaintiff was not required to have subjective knowledge of whether or not a change in risk was material before the insurance can be voided. It was not necessary that the fire had to have been caused by a tenant in assessing whether or not the change in risk was material. The court concluded the plaintiff knew, or should have known, that his decision to take in tenants was material to the risk. The court reached this conclusion because, unlike the insurer in Aviva v. Thomas, the questions put to the plaintiff in the application process made clear that the issue of renters was important. This is a helpful reminder to all insurers. Material facts are those which, if known by a reasonable insurer, would have influenced its decision to decline to offer insurance, or alternatively, charge a different premium for the insurance provided. If a fact is material, it is crucial that it be highlighted and brought to the attention of a potential insured.
Ad_Canadian Underwriter-0316.indd 1
2016-03-14 10:44 AM
Opinion/Analysis
Choosing a properly qualified appraiser for contents such as fine art, jewellery and historical items can be of benefit to the broker, carrier and insured. John Grow
Partner, Prestige Evaluations
When a consumer with valuable contents — such as jewellery, collectibles and fine art — buys a home insurance policy, choosing a qualified appraiser is in the best interest of the broker, the policyholder and the insurance carrier. However, just as not all carriers and brokerages are created equal, not all personal property appraisers are created equal. Policyholders frequently rely on many types of appraisers, including real estate, immovable property, business valuation, machinery and equipment. In each of the aforementioned specialties, the property in question needs to be appraised by an educated professional with a strong financial
34 Canadian Underwriter October 2016
background and industry knowledge. The associations to which those appraisers belong is not something to be taken lightly. Many belong to the American Society of Appraisers (ASA) or the International Society of Appraisers (ISA). Such accreditations provide a way for a client to verify credentials and membership. In a home, contents sometimes include more than just furniture and household items. Some homes also contain fine art, antiques, jewellery, watches and clocks, musical instruments, furniture, household contents, artifacts, historical items and military equipment. An appraiser who estimates the value of such items needs a proper educational background in the field, plus an appreciation of the maxim that the more one learns, the less one knows. Many appraisers will be covered not only by errors and omissions insurance, but also by liability insurance in case they accidentally damage the property they are inspecting. For example, an appraiser may accidentally put his or her hand through a piece of valuable art or drop a fragile
Illustration ŠRemy Simard, i2iart.com
Appraising Contents
DRIVE YOUR BUSINESS FURTHER
HAGERTY KNOWS HOW IMPORTANT EFFICIENCY IS TO YOUR BUSINESS. We work to create better options for brokers, like our improved online portal and vehicle valuation tools, with no appraisals required. Hagerty’s commitment continues with our streamlined online quoting, Agreed Value 19A coverage and resourceful local field staff. For same-day sign up & quoting visit hagertybroker.ca, email broker@hagerty.com, or call 888-216-2379.
Coverage available in AB, BC, NB, NL, NS, ON & PEI. Hagerty Canada, LLC policies are underwritten by Elite Insurance Company, an Aviva Canada company.
item that is worth thousands of dollars. With ISA — which has chapters in Canada — the combined knowledge that each member brings to the table is very large, and that knowledge is shared. The membership requirement is strict. In order to qualify for membership, one needs to go through valuation courses and Uniform Standards of Professional Appraisal Practice (USPAP). In addition, membership requires each person to maintain a number of professional development credits per year, and to be involved within ISA chapters. There are three member levels: Member — ISA; Accredited Member (ISA-AM); and Certified Member, or ISA-Certified Appraiser Personal Property (CAPP). In addition to the requirement to pass exams and obtain continuing education credits, a member needs to have a background in the field in which he or she specializes and needs to go through peer review.
PROPER WORK FILE Unfortunately, not all appraisers have the same qualifications. Some people take a few courses and call themselves “certified appraisers,” but do not belong to a society such as ISA or ASA. The terms “Certified & Accredited”, “USPAP-certified” or “Licensed Certified Appraiser” sound very nice, and look good on paper. However, a real professional appraiser is not an auctioneer, an antique or fine art dealer, or a person who handles estate sales. An auctioneer or dealer could provide a sales estimate, but that is not an appraisal. A qualified appraiser can provide a verbal opinion of value, as long as he or she maintains a proper work file, which includes photographs, comparable research and documented methodology. The work file should include notes on details — such as condition, make or special marks — of the piece. For example, with art work, a work file might have information on whether or not it has been exhibited or catalogued. There is always the possibility that an insurance carrier will dispute the policyholder’s appraisal of the value of 36 Canadian Underwriter October 2016
mentation that a claims examiner could use to determine whether there is a total loss or whether the item could be repaired or restored. There have been numerous cases in which a claimant provided a two-page manifest of antique items or fine art, with just one line and an amount per item. This does not benefit the client if there is a claim — especially if the claim is denied due to lack of documentation.
PROPER VALUATION
There have been numerous cases in which a claimant provided a two-page manifest of antique items or fine art, with just one line and an amount per item. This does not benefit the client if there is a claim. expensive content. Therefore, there are numerous benefits — to the broker, the insurer and the insured — of using a real appraiser. “As an insurance brokerage, we find that having our clients’ collectibles and jewellery appraised by a member of the (ISA) gives us peace of mind,” reports Colette Mendenhall, president of ASSURART Inc. “We are not concerned that the validity of the appraisal will be questioned by the insurer in the event of a claim.” Both an insured and a carrier can be assured that a real professional appraiser would not overestimate the value of the item. In the event of a claim, a professional appraiser could provide docu-
When using an appraiser who is not properly qualified, there is a risk of having valuables undervalued. There is also the risk of an insurance policy being written for an amount that is a lot lower than the replacement cost. An additional risk is that the item could be overvalued, both in market value and replacement cost, thereby resulting in the client paying a higher premium than warranted. A qualified appraiser would also not be in a conflict of interest because he or she would have no vested interest in the items that are being appraised. Properly qualified appraisers are not art dealers, antique dealers or persons who would buy and resell. Some appraisers do broker items for their clients, but in those cases, the relationship changes from an appraiser to that of a broker. Among the fastest-growing markets for insurance underwriters are watch collectors and watch-buying co-operatives. Today’s professionals are buying antique, vintage and current watch models. Many antique and vintage watches are irreplaceable. The type of appraisal report required for insurance underwriters is much more detailed that what some jewellery stores might provide. A personal property appraiser is more of a generalist, with expertise in appraisal studies. A fine art appraiser might have his or her interest, but the types of work, medium and subject matter is vast. This is why a serious appraiser will belong to an appraisal society, seek the help of fellow appraisers and increase his or her level of education in the field through specialized courses.
CHOOSE A CHAMPION Jimmy Walker
2016 PGA Champion Burns & Wilcox Brand Ambassador
Expertise, perseverance and hard work separates the contenders from the pretenders. Access industry experts that have the widest variety of commercial, professional and personal solutions. Whatever the challenge, you can perform like a champion with Burns & Wilcox. Burns & Wilcox, the leader in specialty insurance.
burnsandwilcox.ca
Cross Border | Binding | Commercial | Professional | Personal | Risk Management Services
41565 BURNS Canada Jimmy Win Ad RZ Canadian Underwriter APPROVED.indd 1
9/6/16 2:39 PM
COVER STORY
Bridging the Gap
Bridging the Gap Brokers have an obligation to advise clients not only on coverage gaps, but also what insurance is available. Experts caution that small businesses can have complex risks and personal lines customers need to be asked about any commercial use of their assets, especially if they expect visitors to their home offices. GREG MECKBACH
38 Canadian Underwriter October 2016
S
mall businesses may have coverage gaps in areas such as employment practices and cyber risk, and brokers need to ask the right questions and advise on availability of coverage, industry professionals say. Meanwhile, Canadian courts have consistently held that brokers have a legal duty to advise business clients on foreseeable risks. “A lot of small businesses can be pretty complex when it comes to their exposures,” reports Crystal Rogers, general insurance broker and Autoplan supervisor at Port Moody Insurance Services, part of the InsureBC group of brokerages, based near Vancouver. Two liability risks to small firms that are often not addressed are claims from employees and claims from stakeholders (such as debt and equity holders), suggests Andrew Clark, chief executive officer of Toronto-based brokerage ALIGNED Insurance Inc. Clark says brokers should ask small business clients about their ownership structure and sources of revenue. “What we tend to find is small businesses are doing a lot of different things in a lot of different ways,” reports Clark. “It may be through separate legal entities; it may be through incorporated companies. It may not. Just to understand the legal framework first and foremost is kind of our starting point, and then from there, understanding the various revenue streams.” Asking such questions “tend to impact upon questions that they may have or scenarios that may not have been thought of and then, obviously, you can translate those into the coverage,” he adds. “Small enterprises present unique exposures,” warns Nazir Haji, senior vice president of business development at AEGIS London, the British subsidiary of Associated Electric & Gas Insurance Services Limited, which acts as the Lloyd’s underwriting agent for AEGIS Syndicate 1225. “While the content amounts are usually small, business interruption, equipment breakdown and errors and omissions are significant exposures that need to be evaluated,” Haji says of small businesses. “In addition, liability coverage that is unique to the exposure must be thoroughly evaluated for the limits required.” Brokers serving small business clients should ask what happens if the insured has to operate from somewhere else, and whether or not it has contingency plans, Haji advises. A broker who fails to ask the right questions could be sued for negligence if a claim is denied due to a coverage gap. The Court of Appeal for Ontario explained the brokers’ legal duty of care in a decision released almost 40 years ago.
October 2016 Canadian Underwriter 39
COVER STORY
Bridging the Gap That ruling — cited as Fine’s Flowers Ltd. et al. v. General Accident Assurance Co. — continues to be cited today when claimants sue brokers for negligence and/or breach of contract after claims are denied due to coverage gaps. The Fine’s Flowers ruling was cited this past June, by the Provincial Court of Saskatchewan, in Zheng v. John Galon Insurance Services Ltd. Jianlong Zheng’s Regina residence was damaged by fire. Zheng was unsuccessful in a lawsuit against both his broker and Saskatchewan Government Insurance (SGI) after his homeowner claim was denied. Court records indicate that Zheng had renters. However, Zheng had indicated on his application form that he was not seeking coverage for rental income. The Fine’s Flowers ruling was also cited in 2013 in Bronfman v. BFL Canada Risk and Insurance Services Inc. Fine’s Flowers sets out the “general nature of the duty of an insurance broker,” wrote Justice Elizabeth Stewart of the Ontario Superior Court of Justice, in 2013, in Bronfman.
CLIENTS RARELY READ POLICIES The Toronto home of Paul and Judy Bronfman was broken into in 2008. A safe containing jewellery and cash was stolen. Court records indicate the Bronfmans’ homeowner policy, written by American International Group Inc., had a limit for contents of more than $2 million. However it also had sub-limits of $10,000 for jewellery, $5,000 for furs, $5,000 for stamps and coin collections and $1,500 for cash, among others. Due to those sub-limits, much of the loss from the theft was not covered. BFL Canada Risk and Insurance Services Inc. — which had placed commercial insurance for Paul Bronfman’s company — also started placing his home insurance in 2004. After AIG denied his claim due to lack of coverage, Bronfman sued BFL for breach of contract and negligence, claiming he “ought to have been clearly warned about these policy limits for jewellery and advised that additional coverage 40 Canadian Underwriter October 2016
for this valuable property was available,” Justice Stewart wrote. BFL argued that the Bronfmans were aware of the coverage limits on losses of jewellery. An expert witness in the trial, James Bonnay, testified that “few clients ever read their insurance policies or, if they do, rarely actually understand their complex provisions.” Bonnay told the court that “the broker’s role and obligation is to explain the extent of coverage to clients and to point out any relevant gaps.”
“A lot of small businesses can be pretty complex when it comes to their exposures,” reports Crystal Rogers of Port Moody Insurance Services. Bonnay has been involved in the disciplinary arm of the Registered Insurance Brokers of Ontario, Justice Stewart noted. Justice Stewart ruled against BFL, finding that the BFL broker had a “lack of appreciation of the likelihood that the Bronfmans owned valuable jewellery worth well in excess of $20,000,” and failed “to ascertain the true extent of their possessions and to provide them with advice as to how much special coverage they needed.” Justice Stewart noted that in Fine’s Flowers, the Court of Appeal for Ontario “held that an insurance agent’s duty when asked to obtain a specific type of coverage is to use a reasonable degree of
skill and care in doing so and to inform the principal promptly if such coverage is not available.” In Bronfman, the defendant broker appeared to “take the position” that the insureds were “required to read their policies and the letters which accompanied them,” Justice Stewart noted. Commenting on Fine’s Flowers, Justice Stewart added: “If the principal was given no specific instructions, but relies on the agent to see that he is protected, then the agent, if he agrees to act on such terms, must inform himself of the principal’s business in order to assess the foreseeable risks and to insure his client against them.” In ruling in favour of Fine’s Flowers, the Court of Appeal for Ontario upheld a lower court ruling, released in 1974, against brokerage firm Ault, Kinney, Campbell and Gallichan Limited. That broker had placed insurance for a retail store and garden centre in Ottawa operated by Harry Fine. That garden centre included greenhouses. The heating system, in some of those greenhouses, failed in January 1968. Some of Fine’s horticultural crops were destroyed. Fine’s Flowers made a claim under a boiler and machinery policy written by General Accident. That policy covered accidents to “objects.” The heating system failed as a result of a failure in water supply pumps, but the boiler and machinery policy excluded wear and tear. Further, the pumps and motors in the greenhouse were not defined as objects in the policy.
REQUISITE SKILL Fine’s Flowers’ lawsuit against insurer General Accident was dismissed, but the court found that Ault, Kinney, Campbell and Gallichan breached its duty of care. The Fine’s Flowers case was one “in which the client gives no such specific instructions, but rather relies upon his agent to see that he is protected and, if the agent agrees to do business with him on those terms, then he cannot afterwards, when an uninsured loss arises, shrug off the responsibility he has assumed,” Justice
WE BELIEVE ACTIONS SPEAK LOUDER THAN WORDS. OUR CUSTOMERS AGREE. Our knowledgeable and caring claims professionals are some of the best in the business, consistently earning kudos from 9 out of 10 customers in post-claim surveys for the past decade. Don’t just take our word for it. See what our customers have to say. economical.com/stories
property | auto | business Economical Insurance includes the following companies: Economical Mutual Insurance Company, Waterloo Insurance Company, Perth Insurance Company, The Missisquoi Insurance Company, Sonnet Insurance Company. ©2016 Economical Insurance. All rights reserved. All Economical intellectual property, including but not limited to Economical® and related trademarks, names and logos are the property of Economical Mutual Insurance Company and/or its subsidiaries and/or affiliates and are registered and/or used in Canada. All other intellectual property is the property of their respective owners.
COVER STORY
Bridging the Gap Bertha Wilson of the Court of Appeal for Ontario wrote on behalf of the majority. “If this requires him to inform himself about his client’s business in order to assess the foreseeable risks and insure his client against them, then this he must do. It goes without saying that an agent who does not have the requisite skills to understand the nature of his client’s business and assess the risks that should be insured against should not be offering this kind of service.” Justice Wilson — who was appointed to the Supreme Court of Canada in 1982 — cited Fine’s Flowers in 1990 on behalf of Canada’s highest court. Fine’s Flowers is the “leading Canadian case concerning the duty of care owed by private insurance agents and brokers,” Justice Wilson wrote on behalf of five judges hearing an appeal from Manitoba Public Insurance (MPI).
and breach of duty. MPI argued it had sent a one-page flyer to the Fletchers mentioning the availability of UMC, but the Fletchers said they thought they had the maximum available coverage. An Ontario trial judge ruled against MPI. That verdict was overturned by the Court of Appeal for Ontario, but restored by the Supreme Court of Canada.
MORE THAN SALES
“Home office exposures are usually underestimated, particularly when customers are coming to the premises to pick up the products,” warns Nazir Haji of Lloyd’s syndicate AEGIS London.
“It is clear that within the insurance industry, as also within the courts, private insurance agents and brokers are viewed as more than mere salespeople,” Justice Wilson wrote, in 1990, in the Supreme Court of Canada’s unanimous ruling in Fletcher v. MPI. “It is entirely appropriate to hold private insurance agents and brokers to a stringent duty to provide both information and advice to their customers. They are, after all, licensed professionals who specialize in helping clients with risk assessment and in tailoring insurance policies to fit the particular needs of their customers. Their service is highly personalized, concentrating on the specific circumstances of each client,” she noted. Thomas and Cheryl Fletcher were insured by MPI. They had been driving in Ontario when they were in a collision. The driver of the other vehicle was found responsible and damages were assessed at almost $1.4 million. But the at-fault driver only had $500,000 in insurance and the Fletchers’ MPI policy did not include underinsured motorist coverage (UMC). They sued MPI in Ontario, alleging breach of contract, misrepresentation, negligence 42 Canadian Underwriter October 2016
Ottawa-based agent for State Farm in Canada, commenting in general, not on the Fletcher or Fine’s Flowers rulings. “It is important to ask a lot of pertinent questions, and read their website if they have one,” Marchese says of small business. “A part-time business owner might not be as familiar with the different risks facing them as someone who is full-time or owns a larger business with lots of tenure. One nail salon might only do nails while another is doing waxing, facials and tanning.”
EMPLOYMENT PRACTICES
“Subtle differences in the forms of coverage available are frequently difficult for the average person to understand,” the Supreme Court of Canada noted in Fletcher v. MPI. “Agents and brokers are trained to understand these differences and to provide individualized insurance advice. It is both reasonable and appropriate to impose upon them a duty not only to convey information, but also to provide counsel and advice.” An insurance broker or agent “needs to understand the scope and details of their client’s business as clearly as possible,” suggests Steve Marchese, an
Clark suggests that the “most frequent” conversation that ALIGNED brokers have with small business clients is on the risks that are not covered by either a property or commercial general liability policy. “How are you protecting the management team if things go sideways and things go bad?” asks Clark. “There is a lot of risk embedded in starting a business, and as we know, a lot of new businesses tend to fail within the first couple of years,” he notes. When a firm goes under, one risk includes “outstanding statutory liabilities like unpaid taxes and unpaid wages, as well as litigation from creditors and shareholders against the management team,” Clark reports. “Once you have clarity on the organizational structure and the legal structure you can start to get into the conversations about how to de-risk the management side of things, and that is an important conversation that sometimes is missed in the small business space.” Another exposure for small firms is employment practices liability, Clark suggests. Rogers agrees, suggesting that small business managers “tend to trust their employees more.” If a dispute with employees reaches the litigation stage, Rogers suggests, there could be legal defence and settlement costs. “A lot of small business owners don’t seem to think of it that way,” Rogers reports. “They trust that their employees are not going to steal from them, or
Broker-Centric Services, for all your needs Crawford has extensive experience managing all aspects of the claims cycle. We provide integrated and customized solutions to brokers and their clients. Centered on superior 24-hour service, we adhere to key metrics using advanced user-friendly technologies for all claims and data management needs. We achieve higher client satisfaction and retention levels by establishing and implementing effective insurance programs anywhere in the world, regardless of size and scale. For more information on any of our services, contact us at info@crawco.ca.
Let Crawford help you build partnerships that last. Independent Adjusting
Data Analytics
Third Party Administration
24-Hour Contact Centre
www.crawfordandcompany.ca
Crawford-Broker-Services.indd 1
4/29/2016 4:41:03 PM
COVER STORY
Bridging the Gap they would never have a dispute arise when, in fact, it does probably happen more often than not.” Small firms also face the risk of human rights complaints, adds Clark. Those “typically” arise from allegations based on a prohibited ground of discrimination or “allegations of lack of protection or discrimination” based on factors such as gender, sexual orientation or religious beliefs, he reports. Another risk is contingent business interruption, Haji suggests. A broker advising a small business client should ask whether the insured is relying on suppliers, and if so, “what if those suppliers are affected by fire or storm?”
But Justice Perell found there was “little risk of fraudulent charges because of sophisticated safeguards developed by credit card companies,” and because “when there are frauds, the losses are almost always absorbed by the credit card company or the retailer.” An expert witness for Home Depot — Telus Corporation security solutions director René Hamel — “testified that despite utmost diligence and efforts to prevent data breaches, companies remain vulnerable because hackers con-
DATA BREACHES Small businesses “actually have significant risks for things that they don’t think about,” warns Rogers. “A lot of cyber stuff is happening nowadays due to employee error and the systems that they use are not as sophisticated as those of big, big companies that actually have money to hire risk management departments,” she explains. Brokers should consider offering small businesses a separate cyber extension endorsement, Haji advises. One firm that was sued in Canada in connection with a data breach was Home Depot, whose payment card system was hacked in 2014. A settlement in a class action lawsuit was approved by an Ontario court, in a decision released August 29. Even though there was no evidence that a class member absorbed a fraudulent charge, and even though the court found the case against the retailer was “proven to be very weak,” the court valued the settlement at about $400,000. An expert witness for the plaintiffs “outlined three heads of damage to consumers from a payment card breach,” Justice Paul Perell of the Ontario Superior Court of Justice wrote. The first is “the risk of a fraudulent charge on one’s credit card.” The second is “the risk of identity theft” and the third is “the inconvenience of checking one’s credit card statements.” 44 Canadian Underwriter October 2016
“A part-time business owner might not be as familiar with the different risks facing them as someone who is full-time, or owns a larger business with lots of tenure,” reports Steve Marchese of State Farm Canada. tinually develop new malicious code and the game of cat and mouse continues,” Justice Perell added. The settlement cost included counsel fee, approved by the court, of $120,000, to the law firms that represented the plaintiffs. Court records indicate the firms requested counsel fee of about $460,000. “Anyone who accepts any bank cards could be hacked,” warns Haji. Notifying customers of data breaches could become mandatory next year.
In 2015, Canada’s Personal Information and Protection of Electronic Documents Act (PIPEDA) was amended to provide for mandatory breach notification. The amendment to PIPEDA was brought in with the Digital Privacy Act, Bill S-4. Bill S-4 would require firms to notify people if their personal information has been lost “and there is a potential to expose us to harm,” said Joan Crockatt, then the Conservative MP for Calgary Centre, in the Commons in October 2014. “The time frame companies would be given to do this under this bill would be as soon as was feasible. For example, if a company’s computer system was hacked and the clients’ credit card information was stolen, the company might need a week to put a fence around it and figure out how many people had been affected,” Crockatt added. The mandatory breach notification regulations “are not yet in force,” Vance Lockton, senior analyst for stakeholder relations at the Office of the Privacy Commissioner of Canada, said April 30 during a presentation at Insurance Telematics Canada in Toronto. “The most recent timeline that we are hearing is that it will probably be in force somewhere around the fall of 2017,” Lockton reports.
UNIQUE RISKS “As we continue to hear about data breach events and privacy events and the legislation continues to evolve, and the responsibility of organizations increases, the conversation around cyber risk with every client is important, whether they are big or small,” Clark contends. Another possible coverage gap is directors’ and officers’ liability, Clark suggests. “It sounds like a big business question,” he says. “It is a big business question and a middle-sized business question, but it is a small business question as well.” Certain types of operations have unique risks, Clark adds. “There are a lot of contractors who come into contact with asbestos or
Open minds. Understand Risk. At The Sovereign General Insurance Company, we recognize the importance of providing risk solutions that enable businesses to adapt and thrive through change. Bringing together a diverse set of capabilities through our Equipment Breakdown operations and Risk Engineering practices we focus on delivering innovative coverage and risk management solutions for our brokers and clients. We are proud to be a trusted partner focused on achieving success for Canadian businesses.
Michel Rivard (left) AVP, Equipment Breakdown Insurance Direct 514-798-6196 michel.rivard@sovgen.com Joe Alcaraz AVP, National Risk Engineering Services Direct 647-826-5232 joseph.alcaraz@sovgen.com sovereigngeneral.com
COVER STORY
Bridging the Gap
“Once you have clarity on the organizational structure and the legal structure, you can start to get into the conversations about how to de-risk the management side of things, and that is an important conversation that sometimes is missed in the small business space,” says Andrew Clark of ALIGNED Insurance. similar materials,” Clark says. “Say they are doing a renovation on a home and they run into these materials. If only the traditional (commercial general liability) policy is purchased and not a fullsome contractor’s policy that includes pollution and contaminants, that can be an issue for smaller contractors.” Brokers should ask personal lines customers whether or not there is any commercial use of their vehicles or other assets, suggests Clark. “Clients do not necessarily think of themselves as personal lines clients or commercial lines clients,” he reports. “They just think of themselves as clients. It’s not always intuitive for them to appreciate that there are significant differences (between coverage for personal use and coverage for commercial use) and potential risk in not sharing that information.” Marchese echoes Clark’s advice. He suggests that an agent or broker should ask a personal lines customer whether or not he or she owns a business, whether or not he or she ever drives the car for compensation and whether 46 Canadian Underwriter October 2016
or not there is any child care business being conducted in the home. Day care and babysitting can open a large liability exposure, Rogers warns. “One of the questions we always ask on any new business application is if they have any sort of day care or if they are babysitting children and things like that,” she reports. Some insurers cover business use on home insurance policies in certain circumstances, Rogers suggests. “It depends what kind of business it is,” she notes. For example, for a small home office, if “there are no customers, clients or couriers coming on to the premises, [some insurers] will say, ‘Yeah, that’s fine. There is no exposures for the property.’ But those might require a professional liability [policy] or something like that for the type of work that they are doing.”
SLIPS AND FALLS Brokers and agents need to educate personal lines customers on the limits in their policies for home and personal use, Marchese suggests.
“For example, a music teacher in the home might not realize that there will be a very low business contents limit on their instruments and a supplemental business policy will be needed,” he points out. “Home office exposures are usually under-estimated, particularly when customers are coming to the premises to pick up the products,” warns Haji. “Slips and falls causing bodily injury are quite common, so it is prudent that these exposures are managed.” When renewing personal lines policies or binding new policies, brokers need to check the client’s occupation, Rogers suggests. “The reason to do that is to make sure they do not have a business or that they work for themselves or that they have work being done in the home,” she advises. “A lot of personal lines policies won’t cover any risks to do with the business itself. So one of our procedures (is) to make sure (that) if they are in business for themselves, that they are getting the proper coverage so there are no blurred lines if there is a claim.”
PR EMI U M F I N A N C IN G
P e r son al & Comm erci al L i n es
ARE YOU WAITING DAYS FOR YOUR FINANCE QUOTE? With IFS, our response time is measured in hours, not days
ARE YOU LOSING POTENTIAL BUSINESS FROM CUSTOMERS? Not everyone fits the “Direct Bill” mold. IFS finances all types of personal and commercial policies: MGA’s, Facility and Regular Markets
DO YOU CHASE CUSTOMERS ON THEIR DELINQUENT PAYMENTS? At IFS, we do that for you. We take full ownership of the payment collection process so brokers can focus on selling, not collecting
ARE AUTOMATIC CANCELLATIONS FROM NSF’S A CONCERN? IFS has a “Cancellation Prevention Process”. We engage and work with the customer to settle the account and avoid cancellation Was your answer “yes” to any of these questions? If so, contact IFS Financial Services Inc. for more information:
B a r b a r a Tr u d ea u 1-800-565-1153 Sa le s a n d Ma rket ing Co-ordina to r ( 8 7 7 ) 4 8 1 - 6011 ba r ba r a @ if s-fina nce.c om
Working with Canadian Brokers for over 39 years
User friendly system with a dedicated team
Phone lines are open 7:30am - 6:00pm EST
We earn your business with our stellar service
1-800-565-1153 i fs-fi na nce.com
J a i L a b a B c o m m , C AIB P resi d en t ( 877) 481- 6014 j ai @ i f s - f i n an ce.co m
Brokers in Quebec should offer earthquake coverage on every new policy sold and carefully document customers’ refusals to purchase such coverage. Ted Harman President, Accent Insurance Solutions
Of all the various types of risks and perils that are covered by insurance, earthquake is one of the least understood perils that brokers insure. The peril is misunderstood because earthquake events causing sufficient damage to structures to warrant an insurance claim are very rare. While there are approximately 30 earthquakes per month in Quebec, few are detectable by humans. Few perils have such a low frequency and, yet, can also have severity that ranges into the billions of dollars per event. In February 2015, Insurance Bureau of Canada
48 Canadian Underwriter October 2016
(IBC) published a report on earthquake in Canada which highlighted information that had been presented at its first earthquake conference in Vancouver in October 2014. The report — Preparing Canada for Earthquake: A National Conversation — describes the potential damage caused by a 7.1 Richter scale event in Quebec’s Charlevoix seismic zone. Direct property losses are estimated at $49 billion, while indirect losses (business interruption) are estimated at $11 billion. Natural Resources Canada estimates there is a 5% to 15% likelihood that this type of event will occur within the next 50 years. In other words, the country has between a one in 20 and a one in seven chance of a major quake in the next 50 years. The magnitude of the projected losses — $60 billion — is significant. That would be the equivalent of 25% of Quebec’s annual gross domestic product. However, only 4% of Quebec homeowners currently insure their dwellings for quake. There-
Illustration ©Remy Simard, i2iart.com
Quake Coverage
CREECHURCH is a Leading Underwriter of Insurance for EMERGING TECHNOLOGY & KNOWLEDGE BASED COMPANIES.
BUT DID YOU KNOW WE ALSO UNDERWRITE
STAND ALONE PROPERTY VACANT PROPERTY | COURSE OF CONSTRUCTION | BUILDERS RISK ARTISANS | CONTRACTORS SPORTS | LEISURE | EVENTS COMMERCIAL CRIME & FIDELITY UP TO $10M LEGAL EXPENSE
WWW.CREECHURCH.COM 877.814.7778 TORONTO | MONTREAL | VANCOUVER
fore, the magnitude of uninsured losses could be substantial. If 20% of projected direct losses are to homes, the uninsured exposure for homeowners alone is $9.4 billion. IBC projects total uninsured losses at $48.3 billion. The ability of the provincial government to provide aid to uninsured homeowners and businesses will be limited by the effects of the earthquake on the Quebec economy. Overall, tax revenues for the government will be significantly reduced based on lower economic output. At the same time, expenses — notably for the reconstruction of public infrastructure — would rise significantly. Another area of significant concern for earthquakes is the resiliency of the construction sector — and the ability of building companies to ramp up capacity — to meet burgeoning demand for work subsequent to a major event. Without a significant addition to construction capacity, it is reasonable to expect that reconstruction efforts subsequent to a major event would last over more than a decade. For example, Christchurch, New Zealand — which was hit by a series of earthquakes five years ago — is a good example of this phenomenon. 50 Canadian Underwriter October 2016
Only 9% of Quebec respondents believed they are at risk of experiencing an earthquake. One in three believe they are already covered by their policy for earthquake, when, in fact, only 4% of Quebec homes are covered. Tim Grafton, chief executive of the Insurance Council of New Zealand, presented compelling data at an IBC conference regarding construction capacity and the duration of the claims horizon. Grafton delivered his presentation, Preparing for the Long Haul — The New Zealand Experience, at IBC’s quake symposium in 2014. Grafton said that he expects that commercial rebuilding efforts — after the February 22, 2011 earthquake that caused NZ$40 billion in damages — will continue until at least until 2020. At press time, the New Zealand dollar was trading at C$0.96. In Canada, current policy wordings do not foresee anywhere near the duration
of loss that was experienced in New Zealand, particularly for commercial property owners. The insurance industry will have to address this exposure in the future, perhaps by offering extended business interruption coverage with longer claim horizons. As well, the provincial government, insurers and construction unions need to begin planning now for how they will react in these circumstances. In October 2015, IBC sponsored a survey of consumers in Quebec to measure the perception of risk and consumer knowledge of their insurance coverage regarding earthquakes. In the SOM survey, only 9% of Quebec respondents believed they are at risk of experiencing an earthquake. One in three believe they are already covered by their policy for earthquake, when, in fact, only 4% of Quebec homes are covered. This compares to 45% of British Columbian homes insured for earthquake. Clearly there is a need for a significant public awareness campaign to be undertaken to sensitize Quebecers to the level of risk to which they are exposed. It is reasonable to expect homeowners will turn to their insurers seeking compensation for losses, even if the coverage
SPECS.CA
Canada’s leading provider of pre- and post-loss appraisal and consultation services. SPECS provides the insurance industry with expert, impartial, and comprehensive structural consultation. Our customers benefit from: precise valuation of damages, accurate reserves, a reduction in claim cycle times and enhanced claimant satisfaction. Trust SPECS to assist with any residential, commercial, industrial or CAT claim.
SERVICES PROPERTY LOSS SCOPE AND ESTIMATING BID ANALYSIS AND MANAGEMENT
DIVISIONS TECHNICAL SERVICES CONTENTS APPRAISAL STORM AND CATASTROPHE
PROJECT MANAGEMENT AND CONSULTING
Ethics - Excellence - Value - Teamwork
2016 © All rights reserved. Specialized Property Evaluation Control Services Limited
BENEFITS REDUCED CLAIM AND PROJECT TIMELINES EFFECTIVE EXPENSE AND COST CONTROL PRECISE VALUATION OF DAMAGES
888-73-SPECS
(77327)
is not provided by their contracts. This type of situation is not unprecedented. Indeed, after the ice storm in 1998, many insurers were asked to read in coverages that were not in their contracts. More recently, after the 2013 flooding in High River, Alberta, insurers were asked to apply sewer back-up coverages to losses caused by flooding, even though overland flood was an excluded peril in all homeowner policies. With a peril that has an extremely low frequency, the perceived risk of an event becomes remote. Clients will often reject the addition of earthquake to their policy to save on cost and because they do not believe a significant earthquake will happen in their lifetimes. That said, the need to address the issue with clients is very real. Always excluded from base contracts, earthquake is a peril that should be added to a policy to ensure the client has proper protection. Clients may be required to accept sig-
With a peril that has an extremely low frequency, the perceived risk of an event becomes remote. Clients will often reject the addition of earthquake to their policy to save on cost and because they do not believe a significant quake will happen in their lifetimes. nificantly higher deductibles compared to other coverages; in commercial lines minimum deductibles of $50,000 or $100,000 are common. In personal lines, deductibles can range from 4% of building value to 10% of building value, often 20 to 40 times the standard policy deductible. Once informed of the risk
and confronted with the fact that the risk is excluded from their policy, the client can make an informed choice regarding adding the coverage. What should brokers do to ensure that their clients are properly apprised of the risk and the fact that the coverage is not included in their policy? In short, brokers should offer the coverage on every new policy sold. They should also consider writing to every existing client with a homeowner, tenant, condo or commercial building policy. In their correspondence, brokers should consider explaining the risk and offering to add earthquake coverage to the policy. When weighed against potential catastrophic loss, a premium of $20 per month can seem pretty appealing. If a client refuses to accept the coverage, the broker should ensure the client’s file is appropriately documented to indicate the offer and the refusal of the client to add the coverage.
OUT OF THE BOX INSURANCE DESIGNED FOR BROKERS COMMERCIAL . RESIDENTIAL . TRANSPORT *. MARINE .
*auto liability cover available in Quebec only.
At APRIL Canada, we understand that not all risks are created equal. Our team specializes in designing “out of the box” solutions for “out of the box” risks, working in partnership with insurance brokers for the benefit of your clients.
TORONTO . MONTREAL . CALGARY Changing the image of insurance.
1-855-745-1010
www.april.ca
Recent Insurance Press Releases featured on insPRESS.ca A.P. Reid Insurance to acquire Robinson Insurance Brokers of Edmonton
Louis Rossi of Woodbridge wins 2017 Jeep Wrangler Sport S in Select Sweepstakes
Oct 3 – by A.P. Reid Insurance
Sep 14 – by Economical Insurance
‘In the Lab with Origin and Cause: Destructive Testing’ –Webinar
Vericlaim expands operations into Calgary
Sep 30 – by Origin and Cause
Webinar: What you need to know about credit card payments in Canada
ClaimsPro/IndemniPro Announces Operational and Structural Changes to Quebec Region Sep 28 – by SCM Insurance Services
Your clients are pre-approved with FIRST Canada at the Atlantic Brokers Convention Sep 28 – by FIRST Insurance Funding of Canada
ARC Group Canada associates named Best Lawyers
Sep 13 – by Sedgwick
Sep 12 – by FIRST Insurance Funding of Canada
Refreshed brand and new website put customers first at Economical Sep 8 – by Economical Insurance
ClaimsPro’s Specialty Risk Division Enhances National Leadership Team
Sep 27 – by The ARC Group Canada | Le Groupe ARC Canada
Sep 8 – by SCM Insurance Services
CSIO Announces First 50 Technology Leader Brokerages
Deborah Sherren joins Vericlaim in Canada
Sep 27 – by CSIO (Centre for Study of Insurance Operations)
As Insurance Claims Fraud Evolves, Technology is Fighting Back
Economical Insurance provides $17,000 to raise awareness of prostate cancer in Atlantic Canada Sep 27 – by Economical Insurance
Eagle Underwriting Expands into Fine Art and Specie Insurance Sep 26 – by Eagle Underwriting
PT&C|LWG Announces Farhood Nowzartash Ph.D as Technical Lead of Civil/Structural Division Canada Sep 24 – by PT&C|LWG Forensic Consulting Services
SNAP Financement de prime et Imperial PFS s’associent pour étendre leurs services
Sep 8 – by Sedgwick
Sep 8 – by DSB Claims
Mechanical Engineer, Ryan Cockle, P.Eng., joins the Origin and Cause Team Sep 8 – by Origin and Cause
NIAC announces that they have developed a new software application called SeRA, which stands for ‘Survey electronic Reporting Application’ Sep 8 – Nuclear Insurance Association of Canada (NIAC)
Industry veteran Ed Weidmann named Chairman of U.S. Industry Advisory Board of Accident Support Services International Ltd.
Sep 20 – by SNAP Premium Finance
Sep 6 – by Accident Support Services International Ltd. (ASSI)
SNAP Premium Finance and Imperial PFS join forces to expand services
Jeff Setterington joins Evolution Insurance as Executive Vice President
Sep 20 – by SNAP Premium Finance
Sep 6 – by Evolution Insurance Inc.
CSIO Unveils New, Enhanced Website in Response to Membership Survey
Vericlaim Canada acquires RGM Claims Services
Sep 20 – by CSIO (Centre for Study of Insurance Operations)
Brian King named 2016 International Investigator of the Year
CSIO Appoints Christopher Harness of Northbridge Financial Corporation to Board of Directors Sep 19 – by CSIO (Centre for Study of Insurance Operations)
Sep 1 – by Sedgwick
Aug 31 – by King International Advisory Group
David Cook Named President of ENCON
Origin and Cause Featured in The Globe and Mail’s “Report on Business” Magazine
Sep 19 – by ENCON Group Inc.
Aug 31 – by Origin and Cause
To Read the Full Story for Each Press Release visit insPRESS.ca
DALE REMPEL AWARD OF EXCELLENCE
Passion Play Tara Chammartin, recipient of the 2016 Dale Rempel Award of Excellence, is more than willing to share her passion for broker professional development. Angela Stelmakowich Editor
Tara Chammartin is passionate about a lot of things: golf, professional development (PD) and, of course, being a broker. That interest may be, in part, because these passions share some commonalities. “The golf game is good overall for a person because it really teaches you how to be patient,” says Chammartin, operations manager for La Salle Insurance and Travel Services Ltd. in Winnipeg. “It doesn’t matter if you’re having a good game or a bad game; it still takes patience and focus and a commitment. It’s kind of like being a broker. It really is,” she says. When passion combines with recognition, though, things can seem all the more meaningful. So it was with great honour that Chammartin discovered that her efforts to advance PD among brokers had been recognized with an award in the name of a long-time mentor, Dale Rempel, who passed away in 2012. Chammartin is the recipient of the 2016 Dale Rempel Award of Excellence, established three years ago by the Insurance Brokers Association of Canada (IBAC) to acknowledge an individual who has demonstrated commitment and support of broker education, learning and PD. “I am super-honoured, very excited,” Chammartin says. “To have this award in his name is extremely, extremely rewarding to me.” The two met when Rempel was PD chairperson with the Insurance Brokers Association of Manitoba (IBAM), and Chammartin, then in her early 20s and in the industry for just a handful of years, was serving as the PD representative for IBAM’s Young Broker Network. An original member of the network, “Manitoba was the first province in all of Canada to start that and I was there from day one,” she says with pride. “That is where I became very involved and my passion grew for the industry in itself.” Rempel’s support and encouragement only
54 Canadian Underwriter October 2016
serve to help fuel that passion even further. “I saw his involvement with what he was doing as far as PD for brokers across the country was, and I was kind of there along by his side,” says the current IBAM president, a role she assumed this past April. “I learned a lot from him. He’s kind of the one who really motivated me, I think, to become so involved and so I did.”
UNPLANNED DESTINATION Broker, IBAM president and brokerage partner were certainly not ambitions Chammartin had when she applied for a receptionist job at Confederation General Insurance in 1994. “It’s not something you come out of high school saying, ‘I want to be an insurance broker,’” she says, laughing. That view quickly changed. After a couple of months at the brokerage, “I was like, ‘This is kind of neat.’ I thought, ‘This could really be a career.’” And so it began. Chammartin says that she poured all her effort into working, opting to do her fundamentals within the first year. “Then I started my (Canadian Accredited Insurance Broker designation) CAIB 1, CAIB 2, CAIB 3, CAIB 4. It just kind of all progressed,” she says. Chammartin remained at the brokerage for about eight years before weighing her options as to her next move. By that time, she already knew Rempel. She began working at Rempel Insurance Brokers in Morris, Manitoba in 2001, staying there for just shy of a decade. But with about a 45-minute daily drive each way to work — and her daughter becoming increasingly involved in dance, classes for which were in Winnipeg — Chammartin says that things just did not work schedule-wise, so she made the decision to find another position in the city. “It was hard,” she says of leaving Rempel Insurance. “It was probably the hardest decision of my life, because I very much enjoyed working
with Dale and, I mean, he was my biggest mentor,” she says. “I would have never dreamt in a million years that I would have been an insurance broker. So to be in this for over 20 years already is, I think, a testament as to my passion and my dedication to the industry,” Chammartin says. She left Rempel Insurance as operations manager and currently serves in the same capacity at La Salle Insurance and Travel Services. Why? “I love working with people; I enjoy dealing with the clients. That’s not stuff I want to give up,” she emphasizes. Beyond the clients, though, is the ability to lead staff, “so teaching them, engaging them to learn more and giving them my experience,” she adds. It is experience that Chammartin is eager to pass along, as demonstrated by her years of delivering courses and volunteering at the provincial and national levels. She has served on IBAM’s Young Broker Network Committee, Conference Committee and Professional Development Committee, holding the position of chair at the last for more than eight years; organized the professional development aspects of IBAM’s 2015 and 2016 conventions; joined IBAM’s executive in 2014 and is current president; served as Manitoba’s PD representative on IBAC’s PD committee for about six years; and taught CAIB 1 and CAIB 3 course for many years. “I enjoy teaching people about the industry, sharing my passion of the industry with them, which kind of engages them to become passionate about the industry,” Chammartin says. “When I teach my classes, I think everybody knows that I’m a very passionate person about the industry in itself.”
YOUTH MOVEMENT Getting people excited about and engaged in the industry is essential — and a big part of that is attracting young
Photo by Darcy Finley
DALE REMPEL AWARD OF EXCELLENCE
people to the channel. “It’s great to see and attract new people to the industry because they’re going to be the ones who carry it forward,” Chammartin points out. Noting that her brokerage employs quite a few young people, “it’s great because of their attitude, they’re upbeat and they have a lot to offer as far as technology goes. They have ideas, they’re creative,” she says. “I’m a huge supporter of education, so I’m constantly giving the okay to our staff to go ahead” with CAIB or beyond. “Let’s see how we can continue to grow you and build you because the more experience and learning they do, it just makes them a better broker all around,” she says of brokers. “There’s nothing more rewarding than taking somebody who has no experience in the insurance industry, engaging them to take the necessary education to get their licence requirements, etc., and then training them while still furthering their education,” Chammartin maintains. Brokers have “the opportunity to deal
with clients face to face, and I think people still enjoy that. Maybe the younger generation, not right now, because they’re not familiar with it, will also learn to embrace that because you go to an expert for a reason,” she suggests. With things changing so quickly, so is the face of the competition. But Chammartin welcomes all that. “Healthy competition is great. I’m not scared of online competition, personally, because the service that we offer as brokers will outshine a 1-800 number or an online quote any day,” she says. What does the future hold for Chammartin? She says she would certainly be open to doing more with IBAC at the national level, although for the immediate future, her hands are full being IBAM president and a new partner of an expanding business (her brokerage recently acquired two new locations). That may leave little time for golf. “Sometimes I have some good games and sometimes I have games I don’t want to talk about,” she laughs. Regardless what the scorecard reads, Chammartin is still on her game. October 2016 Canadian Underwriter
55
Brenda Rose Vice President and Partner, FCA Insurance Brokers
When developing perpetuation plans, brokerage principals need to consider financing for prospective successors. They also need to consider their brokerage experiences as well as soft skills, including positive attitude and the ability to enable and motivate producers. Insurance brokers need to consider several factors when seeking new talent as part of their succession plans. Not only is experience in the insurance industry a must, but candidates also need experience at a brokerage and a holistic view of the different components of a brokerage. Principals must also be ready to accommodate producers without enough cash readily available to buy a stake in the business. It is easy for brokerage owners to love life. They get to work directly with customers, see
56 Canadian Underwriter October 2016
the direct impact of their efforts on the operation’s success, savour the freedom of making autonomous decisions and pursue areas of personal interest. While it has never been easy to become a brokerage principal, today it can be even more challenging than in the past. The number of outside investor groups competing for ownership has proliferated. Like individual entrepreneurs, these investors — whether venture capital firms, private equity groups, international conglomerates or general insurance companies — are keen to buy into brokerages because they are viable, vibrant businesses with excellent growth prospects. With heightened competition, existing owners can expect higher, harder-to-finance returns for relinquishing shares in their firms. Another hurdle for individuals seeking ownership opportunities is the need for clear perpetuation strategies within existing firms. Sometimes, brokers can be guilty of working more “in the business” than “on the business,’” neglecting the recruitment of the necessary entrepreneurial talent in favour of growing operations. Don Anderson, senior partner at FCA Insurance, testifies to this.
Illustration ©Remy Simard, i2iart.com
Changing Ownership
Two Brands, One Approach! Deep expertise, creative solutions and unique products delivered with exceptional service from engaged staff in a cando culture, offering both underwriting and claim services, a cross-Canada footprint, and a one-stop-shop experience!
Can-Sure Underwriting Can-Sure specializes in bespoke underwriting of commercial and personal risk placements. Our experienced underwriters will tailor coverage to suit your customer’s specific needs. Can-Sure offers expertise in the following lines and segments of insurance: Property (All Classes Standard and Non) Casualty (CGL, XS, Umbrella, Wrap-up) Builders Risk (COC and Blanket) Trucking (Cargo and Warehousing) Contractors Equipment (All Types) Vacant Risks Professional Services (A&E, Medmal, Tech, Misc.) Pollution Liability (CPL, Sites, Trucking) Manufacturing and Fabrication Oil & Gas Contractors and Consultants
Hospitality “Great Outdoors” Resorts and Lodges Recreational Risks Guides & Outfitters High Value Homeowners Hard to Place Homeowners Bed & Breakfast or Home-stay Rental or Seasonal Dwellings Management Liability (D&O) Welding Contractors
www.can-sure.com
Beacon Underwriting Beacon specializes in package insurance products designed to meet your customer’s specific insurance needs. Our experienced underwriters and claims staff support fast, efficient, and comprehensive insurance placements that you can rely upon. Beacon offers expertise in the following insurance products: Boats and Personal Watercraft RideSmart Motorcycle Program (in BC) ATVs, Snowmobiles, Dirt Bikes Commercial Marine (Hull and P&I) Marina Operators
www.beacon724.com
Special Events (Festivals, Weddings, etc.) Small Vendors (Public Market Vendors) Mobile Homes Hole-In-One Coverage Contents-In-Storage Coverage
“I joined a firm of 10 people 42 years ago,” Anderson reports. “In my first 10 years, we brought in young staff and they developed into partners and shareholders of a firm now employing nearly 100 people — but we were working so hard at effectively building our company that we forgot to keep hiring people who would eventually become our replacements. We did not specifically look for people who could develop into owners and then we had to correct our strategy,” he adds. The search for potential candidates requires planning and clarity around what qualifications are needed. Many people believe they possess ownership capabilities, but judging whether or not someone has the potential not only to succeed but to lead others to success, is a complex process. Culture is all important, unique to each organization. It can be difficult to find people with the right mix of experience, spirit, ambition and knowledge to fit in with an existing senior team. In addition to technical insurance knowledge, specialized expertise and demonstrated sales skills, candidates need to possess leadership capabilities that are harder to define. John McNeil, manager of learning and development at RSA Canada, and co-ordinator of RSA’s Making Partner program for brokers, provides an inventory of minimum criteria, including the following: • the willingness to view problems as opportunities; • a contagious positive attitude and energy; • professional, but personal demeanour; • the desire to make those around them better; • the ability to empower those around them and showcase their success; • high, but realistic expectations for continuous improvement and reflection; • a dedication to lifelong learning; and • passion for their role to make a difference. McNeil elaborates on his shopping list. “I believe that people demonstrate the capacity to lead when they have proven 58 Canadian Underwriter October 2016
that: one, they care; two, they set their own higher standard that is committed to personal excellence; and three, by motivating, influencing and enabling those around them, to both directly and indirectly commit to greatness,” McNeil says.
Many people believe they possess ownership capabilities, but judging whether someone has the potential not only to succeed, but to lead others to success, is a complex process. Unfortunately, some who have ambitions to be principals do not recognize that helping others, and so building a culture and the organization, is critically important. New leaders need a holistic view, to appreciate how different components contribute to overall success. Often producers work territorially within their own individual silos, without extending themselves to contribute to the common good; in effect, some sales cultures can perpetuate this narrow approach. Brokerages and individ-
uals all benefit and learn from sharing new perspectives, from openly discussing ideas outside of their own particular expertise and having the opportunity to participate. Beyond sales, many elements underpin a successful brokerage operation — from financial management and insurer relationships, to operational issues like the use of office space and technology — that prospective owners need to recognize. Failing to internalize the needs of the whole means the individual is unlikely to be a successful partner. Robert Kimball, president of Pearson Insurance in New Brunswick, has his own perspective on how to cultivate prospective partners’ success. “What we have done, as what several smaller brokerages have done, is look to family for perpetuation,” reports Kimball. “In my own case, we suggested (our son) Robert look to work with a company for several years. He did this with Wawanesa for four years, doing almost all jobs there except claims. This gave Robert immediate credibility once he started in the (brokerage) office.” Anderson makes a further distinction about previous experience. “We often look for individuals who have around 10 years experience in the insurance business, of which at least five is as an insurance broker,” he reports. “Although people working for insurers have their own skills, often the longer they work for an insurer the more difficult it is for those additional skills and experience to translate into the broker end of the business,” Anderson adds. McNeil also comments on the importance of training and the long-term process of integrating a candidate into an organization. “To ensure that the individual is successful and confident in their role, I also believe that to help them develop, they need to be surrounded with the right support, coaching, mentorship and ongoing continuous education”, contends McNeil. “One big factor I would suggest is involving any possible successor in decisions being made,” advises Kim-
ball. “Even early on in the first years of employment, the involvement will give different perspectives to look at. It also shows the thought process and strengths or weaknesses in decisionmaking of the successor,” he suggests. In addition to mentoring and training within the brokerage, candidates may also tailor more structured education to their own needs, choosing among courses provided by brokers’ associations, insurer programs or leadership sessions outside the industry. Even once skills are identified and located, and development nurtured, financial and legal considerations are obstacles to be addressed. For individuals moving from one brokerage to another to earn a potential partnership, honouring non-compete agreements adds to the initial investments a brokerage must make. That support is significant, so brokerage principals must be careful and confident in their selections; ultimately, there is a leap of faith for both candidates and incumbent principals as there can be no guarantees for results that will become apparent only after several years. Prospective shareholders also may not have the necessary cash readily available. They may have RRSP funds or a house (often subject to a decent-sized mortgage) but little free capital. A brokerage seriously looking for partners must be ready to accommodate
this lack of funds. At the same time, prospective principals must recognize that one must make some material sacrifices initially, before the benefits can be enjoyed. A variety of restructuring options may be considered to allow for additional participants, and good legal and financial planning counsel is essential.
Some insurers, recognizing the value of brokerage independence to their own long-term returns, will not insist on equity or control of portfolios as a condition of loans. Advice from objective industry experts, strategic planning consultants or even from friendly competitors can be also be invaluable. Funds to facilitate buying into a brokerage are available from a number of sources, starting with banks and finance companies, but sometimes even with currently low interest rates, it can be hard to make this work. Other options may include insurance companies that can often tailor attractive terms to a specific situation. Some insurers, recognizing the value of brokerage independence to their
own long-term returns, will not insist on equity or control of portfolios as a condition of loans. Other more creative strategies may work for some, especially if existing owners are prepared to be patient. “I have found the structuring of the transition is a multi-year effort in order to make the most financial benefit to all concerned,” Kimball reports. “In our particular recent approach, we were able to work out a deal internally and that is how we intend to proceed into the future,” says Anderson “It is important that the existing brokerage owners have a commitment to remaining truly independent.” Taking a long-term view, and postponing short-term windfalls, allows the incumbent leadership to preserve not only the autonomous organization they have built, but also the customerfocused philosophy they have lived by. Customers can share in marking the perpetuation of the organization and its culture. “Insurance is a people business, and I believe that announcements should be made publicly with the customers,” says RSA’s McNeil. “New generational leadership changes should be viewed as a celebration to instill a renewed commitment of excellence to both internal and external stakeholders,” he maintains. Passion, perhaps, is the final essential ingredient, for old and new leaders alike. “Often colleagues elsewhere in the industry have no idea how hard most successful insurance brokers work and think our job is soft and easy,” reports Anderson. “Whereas, in fact, it is only very rewarding if you work hard, become absorbed in the business and make some ‘luck’ for yourself.” Independent insurance brokerages need infusions of new talent and the right individuals can take advantage of this, to the benefit of everyone concerned. With careful planning and patience, and, of course hard work, all parties can recoup their investments over time, while seeing their enterprise remain independent and continue to flourish. October 2016 Canadian Underwriter 59
e v r u C g n i L e ar n Brokers responding to a recent survey suggest that they want more education on emerging insurance products, including those associated with residential overland flood, cyber risks and the sharing economy.
Peter Hohman President and Chief Executive Officer, Insurance Institute of Canada
With emerging fields of insurance — such as residential overland flood, cyber risk and the sharing economy — many brokers need to learn more about new coverage options and how to explain them to clients. “Today the markets are so different from one another,” says personal lines manager Lisa Vetter of Smith Petrie Carr & Scott Insurance Brokers Ltd. “Every company is coming up with different ways of handling issues and rating methods. More than ever, profitability strategies and coverages are so diverse that brokers are challenged to educate themselves to stay current and make sure their clients are properly covered.” The Insurance Institute of Canada, the educational arm of the property and casualty industry, recently polled approximately 600 brokers and general insurance agents across the country about their key challenges and education needs. These results were used to create CE OnDemand, a catalogue of one-hour, online courses designed to give brokers advanced product knowledge and more information about emerging trends.
STAYING CURRENT In the survey, seven out of 10 broker respondents said their key challenge is “staying current with product knowledge.” Almost 65% of polled brokers reported another key challenge is to ensure that “customers understand their risks and the coverages available to them.”
60 Canadian Underwriter October 2016
Brokers are seeking highly relevant knowledge in two key areas, says Lisa Boniface, vice president of programs at the Insurance Institute of Canada. “One is emerging trends in the field,” Boniface says. “The other is product knowledge. We are trying to be nimble in creating new online CE courses, such as CE OnDemand, that delve into the trending topics. Also, when insurers introduce new products, we are able to integrate this into our (online) course content.” What are the trending topics for brokers? Cyber risk, errors and omissions, business interruption, directors and officers (private and public), overland flooding, driverless cars and Uber (sharing economy) are the Top 7 topics of interest for brokers, based on the survey results. What, specifically, do brokers want to know about these topics? Answers to this question vary across individual brokers/brokerages and their particular circumstances. But, clearly, brokers benefit from CE in at least three general ways: it helps brokers understand new products and coverage options; it makes brokers aware of any potential coverage issues and it helps brokers communicate to their clients.
NEW COVERAGE After the Calgary flooding in 2013, one of the largest claims events to date in Canadian history, insurance companies responded by introducing overland flood insurance in Canada. Coverages
Breakfast for Cancer
19
th
Annual Breakfast for Cancer
Join us for our panel discussion with Bobbie Goldie and Dr. Uri Tabori Speaker: Bobbie Goldie When Bobbie was diagnosed with breast cancer on December 4th 2015 she began working tirelessly to continue to be a wife, mom, friend, aunt, cousin, employee, leader, and peer. As this is a struggle every day, she continued to expand her toolbox, and started a blog as her logical next step…to share her journey, goods days and bad… On July 29th Bobbie was told that she was cancer free. She continues to pursue her career at Chubb Canada in Major Accounts and also keeps her focus and dedication on her family.
Speaker: Dr. Uri Tabori Dr Uri Tabori is a talented scientist and clinician who has quickly emerged as a world leader in childhood cancer research. His work has greatly advanced our understanding of childhood brain tumours, especially in children with certain medical conditions that predispose them to cancer. One of Dr Tabori’s outstanding contributions include the role of protecting the ends of DNA strands in the biology of childhood brain tumours. Dr Tabori has also helped explain the molecular basis of pediatric low-grade gliomas (PLGGs), the most common brain tumours in children. Dr Tabori’s research acts as a springboard to use scientific knowledge to make a difference to cancer patients in the clinic. Dr Tabori is committed to improving children’s health worldwide. He is a strong advocate for Canadian cancer research, and generously volunteers his time and expertise with the Canadian Cancer Society and other research funding organizations. His outstanding potential has been recognized by prestigious awards and his research is having a direct impact on cancer care.
Wednesday, November 9, 2016 7:00 – 9:00 am
Fairmont Royal York Hotel, (100 Front Street West)
Please purchase your tickets at: www.wicc.ca Ticket price $50 each or $500 for a table of 10 + HST Register at wicc.ca Contact Barb Reddick for sponsorship details barb.reddick@directime.ca or 416-609-3211
are unique to each insurer, creating a need for brokers to advise their clients about their options. “We have been inundated with overland water material, information and wordings over the last year,” says broker Lorna Geldart of Birkett-Hassard Insurance Brokers Ltd. “There is no common language for flood. They all call them different things. You’ve got ‘overland water,’ you’ve got ‘enhanced water damage package’ and you’ve got ‘groundwater’ — they are all different,” Geldart reports. Continuing education helps brokers to keep track of the various new flood products and what they offer. And it is not just education for brokers. “Our job in insurance is really about educating our clients,” emphasizes Toronto broker Brad Neal, a member of the Greater Toronto Area chapter of the Insurance Institute of Ontario.
COVERAGE ISSUES Potential coverage gaps are coming to the fore as a result of sharing economies like Uber and Airbnb. For example, Uber’s online, ride-sharing platform is raising a number of coverage questions for brokers, suggests Philomena Comerford, president and chief executive officer of Baird MacGregor Insurance Brokers LP. Uber now has an insurance policy in Canada that covers its drivers for rides offered through Uber’s online platform. But the drivers in question are still required to carry their own personal auto insurance policies to cover any claims unrelated to In your role as an insurance professional, what key challenges do you face on a regular basis?
Ensuring customers understand their risks and the coverages available to them
Awareness of new govern44% are looking for Cyber risk is an example of how brokers ment regulations ways to explain new insurance solutions to clients. Other “Even though cyber11%claims are prevalent in the paper and 30 40 still 50 have 60 some 70 hesi80 on the radio, I 0think10a lot20of customers Percent tation or lack of knowledge as to how it’s going to directly affect their business,” suggests Paul Martin, president and chief operating officer of RRJ Insurance Brokers Inc. areas of knowledge do “I’m just not sure What we key have enough examples where we
73%
Top 3 factors that are most important when choosing an online self-paced course(s)59%
Trending Topics drones, cyber security, etc. Topics/Subject matter (relevant/interesting) Product Topics -
65%
53%
4.72
25%
the basics Quality of the course (engaging/interactive) Other
44%
4.53
9%
CE credits eligible
0
11%
Other
0
10
20
30
40
50
53%
EXPLAINING TO CLIENTS
Product Topics advanced
69%
Awareness of new government regulations
Identifying impacts of new technology/innovation to the industry
you require the most?
Staying current with product knowledge
Identifying impacts of new technology/innovation to the industry
Uber rides, and Uber drivers are also required to inform their personal auto insurers if driving for the company. “If you want to narrow it down to what would be real present concerns for brokers, it would be whether or not the personal auto insurer would be agreeable to allowing the use of the vehicle for the purpose of accepting rides for compensation under the Uber platform,” says Comerford. “Whether or not there are any coverage gaps is another concern,” she comments. “Uber X drivers will only be able to access basic accident benefits under the master Uber policy. There is no mechanism for providing enhanced accident benefits under the master Uber policy,” she explains. Lease agreements are another issue. For instance, there have been reports of Uber drivers renting cars and then carrying passengers for hire using their rental vehicles. The coverageInof claim the rental youra role as aninvolving insurance professional, whatcar key of an Uber challenges do you face on a regular basis? driver is not clear. Staying current with 69% Continuing product knowledge education helps brokers identify and understand these kinds of emerging issues and potential coverage Ensuring customers understand 65% their risks and the coverages gaps that availablemay to them exist.
60
70
10
20
0
80
30
1
2
40
50
Percent
3.38
3
60
70
4
80
5
Weighted Averages
Percent
Top 5 topics of interest What key areas of knowledge do you require the most? Product Topics advanced
73%
Top 3 factors that are most important when choosing an online self-paced course(s)
Trending Topics drones, cyber security, etc. Topics/Subject matter (relevant/interesting) Product Topics the basics
59%
4.53 9%
0
10
0
46%
44%
Overland flooding
20
1
30
40
2
Percent
50
3.38 60
3
4
Weighted Averages
62 Canadian Underwriter October 2016 Top 5 topics of interest Cyber
50%
D&O (public and private)
25%
CE credits eligible
E&O
Business interruption
4.72
Quality of the course (engaging/interactive) Other
54%
Cyber
54%
70
80
5
11% 0
10
43% 20
30
40 Percent
50
60
70
80
can go into small and mid-sized businesses and say, ‘This happened to a store just like yours.You have all these credit cards and information. Someone shut you down. Can you still do business?’” Serge Solski of AdviseAware Risk Consulting has worked with many brokers on the issue of cyber risk. Solski, who acted as a subject matter expert for the CE OnDemand cyber course, says brokers need to keep several things in mind when talking to clients about cyber risk. “Brokers need to figure out who is the best person to have the conversation with,” Solski points out. “Many times business leaders have a preconceived notion as to what cyber risk is. They may say to a broker, ‘I think that’s a great idea, but I want an IT person to validate that.’ Brokers need to nip that in the bud and bring it back to the business leader, who truly understands the broader business risk of a cyber attack,” he recommends. Brokers also need to advise their clients on risk mitigation, rather than simply trying to transfer cyber risks through insurance. “It’s not all about coverage,” Solski says. “Your client cannot effectively manage their cyber risk with coverage alone. There’s just not enough they can buy to cover all of the potential losses they might suffer from a successful cyber attack,” he explains.
DELIVERING KNOWLEDGE Brokers are inundated with new product information.They need to understand new insurance solutions and how they might affect their clients. Brokers also need to synthesize all this information so that they can make it easy for their clients to understand what they are purchasing. All of this information was used in developing the new CE OnDemand catalogue. Each an hour long, the courses are designed to provide busy brokers with the information they need quickly so that they can best serve their clients in a timely and well-informed manner. In addition, the courses take an applied approach to learning, based on the needs of brokers. “The education of my staff is core and essential,” says Mike Hordichuk, vice president of commercial insurance at Harvard Western. “But are there more creative ways to invest in them? Am I going to pay two people mileage, plus a day of work, when they can take a one-hour, online CE course and get the same thing out of it?” Hordichuk asks. The courses “use either real-life or scenario-based examples to illustrate the challenges or the types of conversations that brokers may be having with their clients,” Boniface points out. “Brokers are looking for concrete examples to help explain the value and types of coverage to clients in a sales situation. Having an in-depth knowledge of different claims scenarios is a real asset in creating a strong value proposition for the coverage,” she continues.
Celebrate the use of technology in the Canadian insurance industry!
Insurance-Canada.ca Technology Awards Do you know of an insurance technology success story? Honour it: • reward the implementation team • recognize a leader • thank a business or trading partner!
Get started — make a nomination. DEADLINE: DECEMBER 2, 2016
Winners will be announced at the 15th Annual Insurance-Canada.ca Technology Conference
Tuesday, February 28, 2017 Note: all nominations will be profiled on the Insurance-Canada.ca website and in the weekly e-newsletter the Chronicle and recognized at the ceremony.
FOR DETAILS GO TO
www.insurance-canada.ca/icta October 2016 Canadian Underwriter 63 ICTA_2017_CallForNoms_1016CU_halfvert.indd 1
2016-09-19 10:36 AM
Fourth Annual Executive Forum Toronto
Customer Connections
Turning Insurance Outside-In was the theme of the fourth annual Executive Forum in Toronto. Speakers touted the benefits of creating a digital experience in multiple channels. Angela Stelmakowich Editor
Greg Meckbach
Associate Editor
Some young insurance buyers are not sure what coverages may be relevant to them, suggested a speaker at the Executive Forum in Toronto on August 30, while a former Manulife official emphasized that getting a solution up and running now is more important than a slick front-end.
COVERAGE OPTIONS Consumers, especially young people buying homes for the first time, are struggling to understand industry jargon, particularly terms and conditions of policies, suggested Daniel Shum, Deloitte’s national insurance sector leader, at the recent Executive Forum. Last year, Deloitte conducted a study in which people between the ages of 25 and 40 were interviewed, Shum told attendees at the fourth annual Executive Forum, held August 30 at the Sheraton Centre in Toronto. First-time home buyers “are under a great deal of pressure and they are faced with this jargon that they didn’t understand as first-time home buyers, first-time buyers of insurance,” he reported. “So they are looking for someone to interpret that jargon or to speak in plain English to them.” Shum, a partner in Deloitte’s financial services practice, showed videos of some of those interviews during the forum, produced by InsuranceCanada.ca Inc. Deloitte asked survey participants “three broad
64 Canadian Underwriter October 2016
questions,” he said. “What are your thoughts on insurance? How would you like your insurer to engage with you? What would you like from your insurer?” Some respondents were “unsure of what products and services may be relevant to them,” Shum said, noting that several questions came to respondents’ minds. “‘What makes sense to me? What coverage makes sense to have?’ They weren’t sure of that. They weren’t able to easily find and compare different coverage options.” But amid these concerns, Shum suggested there is some good news. “Many insurers are now addressing these [issues] and there are some emerging offerings in the marketplace that are very recent that really address a lot of these issues,” he reported. In its survey, Deloitte found some respondents were taken aback at some of the underwriting questions asked during the process of applying for insurance. “When it came to the buy process, what we heard was, ‘Why do you have to ask me all these questions?’” Shum said. “As industry professionals, we all know why we have to ask those questions. It is important to them because it allows us to provide coverage, but they don’t understand why those questions have to be asked.” New technologies are “disrupting the industry,” Shum noted during his presentation.
“We are seeing what we are calling a perfect storm,” he added. “Market forces that are shaping the industry over the next decade. Some of these forces will include consumers that are becoming more knowledgeable and more demanding, largely due to the availability of information at their fingertips.”
CUSTOMER DATA Some insurers have less data pertaining to risk — on their own insureds — than other organizations, suggested Mike Key, vice president of business development, global core insurance for software vendor SAP SE. Historically, insurance companies have been operating in silos, with walls between “the life or the health or the property and casualty or the commercial institutions,” Key said during his presentation, Preparing Insurers for the Digital Century. “We’re talking about slivers, we’re talking about services and product capabilities in a very agile fashion,” Key said of the future. “We’re talking about partnerships with multiple channels that have information about our insureds.” He delivered his presentation August 30 at the fourth annual Executive Forum. The overall theme of the event — produced by Insurance-Canada.ca Inc. and held at the Sheraton Centre — was Turning Insurance Outside-In. “We have car companies that have more information about our insureds, we have commercial entities that have more information about our commercial coverages than we do,” warned Key. “We have health care companies that have more information about our insureds than some of our health insurers.” Furthermore, the insurance companies themselves, “because of social third-party and available Internet of Things information, have that information about those insureds as well, to be able to drive our particular operations,” he reported. “We really believe there’s going to be more change in the next 10 years than there have been in the last 30 years or even in the last 300 years,” added Key.
An industry that was centered on compensating someone for financial loss is dramatically changing, he suggested to forum attendees. “We see the fundamental change in insurance moving from compensation for a final loss to having the information and the technology to be able to reduce the severity of that loss or to be able to prevent the loss itself,” Key reported. Three reasons driving the change are that more information is available than ever before, more technology is available and “there are competitors that have greater access to that information than sometimes insurance companies.”
“You think your data management capabilities are important today? They are going to be absolutely critical in how you manage the data flow in and around your business in the future because of the vast volumes you are going to be having.” In addition, insurance providers, “because of social third-party and available Internet of Things information, have that information about those insureds as well, to be able to drive our particular operations,” he said. “Collaboration, cross-industry collaboration, we think is absolutely key,” he emphasized to attendees. “We see having information, working with the car companies, working with the commercial entities, working with the health side of the business in order to be able to get that information is very, very key and vital to that digital environment of the future,” Key emphasized. “What customers can have today and what you can have today as an insurance industry is that customer-centric environment,” he pointed out. “We think the customer is the centre of all future interactions, not the product. We think
that services should be made available for the product capabilities,” he added. “When you’ve got the information and technology to be able to shape that, to be able to underwrite it, to be able to find products, to be able to rate the risk associated with that loss in real time or that insurable entity in real time, that dramatically changes things,” Key said.
SPEED TRUMPS SHINY FRONT-END Insurance providers who want to use technology to connect with customers need to move quickly, a speaker suggested at the recent Executive Forum. “We are trying to create a digital experience, a digital dialogue, a digital relationship with our customers, and the key to it is the pace at which you do that, and how fast you can do it and the level of quality at which you do it,” noted Joseph Cooper, a global technology executive and former executive vice president, global services and chief information officer at Manulife Financial. Cooper delivered his presentation — Defining and Operationalizing an Effective Digital Strategy — August 30 at the Sheraton Centre in Toronto. “Speed, I can tell you, is the Number 1 item,” he said of technology services. “If you have great quality [but] you are there third, fourth or fifth, you are not going to be as effective at competing in the industry. If you are there first and you have a high-quality experience for your customers, that’s where the winning formula is.” Cooper told attendees that 50% of Internet traffic is “driven” from mobile devices, while two-thirds of Canadians own smartphones. “You think your data management capabilities are important today? They are going to be absolutely critical in how you manage the data flow in and around your business in the future because of the vast volumes you are going to be having,” Cooper added at Executive Forum. “To create a solid customer experience, it’s not about having a shiny front-end,” Cooper contended.
October 2016 Canadian Underwriter 65
Putting the pieces together.
Events and Seminars Calendar You work hard to protect your clients’ property. Now, it’s time to ensure that you apply the same kind of energy and commitment to your own success. CIP Society Events and Seminars give you the opportunity to learn, to network, to catch up on industry developments and to think about your career. CIP Society Seminars Edmonton – The Building Science of Mould........................................... October 25 Edmonton – Fuel Spill Assessment, Remediation and Control ... October 26 Cobden – Fraud Awareness & Prevention ................................................. October 27 Vancouver – Essential Management Skills...............................................November 1 Calgary – Essential Management Skills ..............................................November 8-10 Hamilton – Insurance Fun on the Farm.....................................................November 8 Ottawa – Equipment Breakdown Insurance ..........................................November 8
Edmonton – Lie to Me Interview Essentials & Linguistic Lie Detection ............................................................................... November 15 ADVANTAGE Live Webinar – Fort McMurray Wildfires: Emergency & Industry Response Case Study ................................... November 17 Ottawa – Think on Your Feet®...............................................................November 22-23 ADVANTAGE Live Webinar – Legalizing Marijuana: A Smoky Future ..............................................................................................December 8
Kingston – Fraud Awareness & Prevention .......................................... November 15
CIP Society Events Ottawa – CIP Society Fall Luncheon Advanced Directors & Officers Liability....................................................... October 25
Ottawa – Wine & Cheese & Learn: Autonomous Vehicles ......... November 17
Toronto – CIP Society Indoor Beach Volleyball Tournament ......... October 26
Toronto – At the Forefront – The New Chubb: What we learned from the merger ...........................................................November 29
Kitchener – Annual Speakers’ Luncheon .............................................. November 17
London – CIP Society Olympics 2016...................................................... November 24
Looking for information and research on the latest trends in the p&c industry? Go to insuranceinstitute.ca and visit the CIP Society’s INFORMATION SERVICES section for a free online library of Trends Papers, with topics like Uber, Airbnb, and Drones.
“Surveys will show you that your best promoting customers will be the ones who experience your organization digitally in a very fluid and seamless manner. That puts pressure on having not only a very neat front-end, but a very robust and flexible back-end, and we all know being in this industry that has been the panacea for many years, but it is an absolute requirement,” he added.
FUNDAMENTAL CHANGE Workers of the future will expect the information technology systems at work to be up to the same standard as their consumer devices, a speaker at the recent Executive Forum suggested. By 2025, 75% of the workforce is going to be digital natives, some of whom are now in their 30s, said Avi Greenfield, senior manager of product strategy for OpenText Exstream. “They know from their tablets and their smartphones,” Greenfield said of some workers. “They don’t make the distinction between the technology that they use in their home lives and what they use at work,” he pointed out. Citing a Foresters survey from last year, Greenfield noted 89% of polled organizations identified digital transformation as a top priority for their companies. “This isn’t putting up a new website or upgrading a CRM (customer relationship management) system,” he said. “This is a fundamental change in the way that carriers do business. This is a fundamental change in business models and the way that organizations need to interact with and really engage the new style of consumers and these new technologies.” Many of his company’s customers are evolving to more of a cross-channel method — where multiple communications come from a single source of content that’s channel-agnostic and presented appropriately for the channel engagement, he said. Ultimately, the goal is to provide an omni-channel experience. “You want to enable consumers to pick up a transaction — start it in one channel and seamlessly pick it up in another channel as appropriate,” he said. A key area, Greenfield suggested to
the attendees, is content management. “Having shared content between those channels is really essential in terms of providing a consistent experience, but it also takes your rethinking of that content into a context that is much more customer-aware,” Greenfield said. It really means rewriting content so it is in plain language and more easily understood, he noted. “That has a real impact on customer experience.” As well, Greenfield added, having options for multiple delivery methods that are preferred by customers will further contribute to “having a very impactful customer experience.”
RELEVANCE OF GEEKS Traditional insurance companies are “responding more slowly to the changing customer expectations and we are encumbered to some extent by legacy technology,” suggested Ben Isotta-Riches, chief information officer of Aviva Canada, at the recent Executive Forum. In his presentation, Going Digital: Cultural Disruption, Isotta-Riches described the characteristics of firms that he described as “born digital.” Such companies “are customer experience-centric, they are driving the consumer expectation across all sorts of industries, whether they are operating in insurance or not,” he said. “They are highly agile, they are responsive to change and their technology organizations are leading and evolving. These are organizations where their (chief executive officer) is a software engineer in most cases.” Executive Forum was held August 30 at the Sheraton Centre in Toronto. Isotta-Riches told attendees that six of the 12 richest people in the world are “geeks.” Those six are Microsoft Corporation founder Bill Gates; Amazon founder Jeff Bezos; Oracle Corporation founder and executive chairman Larry Ellison; Facebook founder and CEO Mark Zuckerberg; and Google founders Larry Page and Sergey Brin. “Geeks have suddenly reached a point where they have massive relevance,” Isotta-Riches said. “Being able to pro-
duce innovative products is driven by diversity of people, cultures and ideas.”
PERSUASIVE SELLING Companies selling insurance online to consumers could take a few lessons from Aristotle, a speaker suggested at Executive Forum. “To get anyone to do anything, we have to capture their attention,” said Brian Cugleman, senior scientist and director at Alterspark. “You have to arrest attention and then you have to get to someone’s mind so that they have a cognitive understanding, and when you sell insurance, it can be a bit tough sometimes to get people to understand abstract things and a good number of us are very concrete in our thinking, and others are very abstract.” Cugleman made his comments during an Executive Forum presentation, Digital Psychology Evoking Emotion to Sell Insurance. Cugleman’s co-presenter was Andrew Lo, chief operating officer at Kanetix Ltd. Lo said Kanetix conducted a research project to identify best practices in auto insurance customer acquisition. “We looked at the content of multiple sites in terms of their auto insurance conversions” he pointed out. “We looked for persuasive design features.” During his presentation, Lo cited as examples the belairdirect and Progressive auto insurance websites, explaining the psychological impact of their mascots. “The psychology of a speaker who is credible and can persuade someone is similar to a brand that is credible and can persuade someone, which is also similar to a technology or a website that can persuade someone,” Cugleman said. “If we have people who don’t care about something, your deal is off the table,” he said. “It’s not an option. Decision support is extremely important, so we can have people who are motivated, but along comes analysis paralysis and they can’t make up their mind.” Aristotle discussed methods of persuading people, Cugleman told attendees, suggesting that Aristotle’s methods “are just as relevant” now “and have been studied in depth.” October 2016 Canadian Underwriter 67
MOVES & VIEWS
UPCOMING EVENTS: FOR A COMPLETE LIST VISIT
www.canadianunderwriter.ca
AND CLICK ‘MY EVENTS CALENDAR’ ON THE HOME PAGE
1
Rob Wesseling [1] becomes president and chief executive officer of The Co-operators Group Limited as of December 1, 2016, the Guelph, Ontariobased carrier reports. Currently executive vice president of property and casualty operations for The Co-operators and chief operating officer of the Sovereign General Insurance Company, Wesseling will replace Kathy Bardswick, who is retiring. Holding a Chartered Insurance Professional designation, he is also an acting member of the International Co-operative and Mutual Insurance Federation’s Board of Directors.
2
Managing general agent ENCON Group Inc. has named David Cook [2a] as its new president. Come November 1, Cook, chief underwriting officer (CUO), will succeed Jean Laurin [2b], who is retiring after more than 30 years of service to the company. Cook joined ENCON in 1992 and was appointed vice president and chief actuary of the underwriting management division in 2002, senior vice president responsible for underwriting review of large accounts and provision of application handling and policy issuance services to brokers in 2007, CUO in 2016 and
68 Canadian Underwriter October 2016
1
2a
2b
5b
6
7
managing director in 2016. ENCON is part of Schinnerer Group, the parent firm Marsh & McLennan Companies Inc. reports in a securities filing.
catalyst for the University of Alberta’s decision to offer the CRM (Canadian Risk Management) course.
3
Mark Day [3], executive director of risk management and insurance for the Government of Alberta’s Treasury Board and Finance, received the Donald M. Stuart Award — presented annually by the RIMS Ontario Chapter — during the RIMS Canada Conference. Day is also a member of Alberta’s Assistant Deputy Minister Recovery Task Force, which has been instrumental in guiding the province through a number of recent natural disasters, and was the
4
Jeff Setterington [4] joined Evolution Insurance as its executive vice president on September 6. In his new role, Setterington will focus on growth, notes a statement from the managing general agent, wholesaler and risk consultant operating across all Canadian provinces.
5
SCM Insurance Services has opened a Chicago office, appointing Scott Goodreau [5a] as chief operating officer — USA. The appointment of Goodreau, who previously
led sales and marketing for Chicago-based Hub International, was described as the “first step” towards taking SCM’s services to the United States. “Initially, our focus will be targeted at two fronts: third-party administration and claims adjusting services,” Bob Fitzgerald [5b], chief executive officer of SCM Insurance Services, says.
6
Marsh has appointed Christopher Schaper [6] as chief executive officer of the company’s managing general agent (MGA) business, the Schinnerer Group. Schaper will focus on the development and advancement of Marsh’s existing MGA businesses in Canada and the United
MOVES&&VIEWS VIEWS MOVES
of Calgary; Gordon Adams; Robert Cartwright, Jr.; Al Gorski; Leslie Lamb; John Phelps; Michael Phillipus; Frederick Savage; and Lori Seidenberg.
3 3
9 positions have included general adjuster, branch manager, 8 vice president of operations and Lloyd’s Division leader. States, as well as oversee the development of its MGA business internationally. Macdonald Schinnerer Group Chisholm is comInsurance (MCT) prisedTrask of Victor O. Schinnerer announced in early & Co. in the U.S. and ENCON January thatinitCanada, will joinreports propGroup Inc. erty and casualty brokerage parent company Marsh & BrokerLink. The terms Inc. of the McLennan Companies transaction were not disclosed,Lorie notesPhair a statement [7] is from BrokerLink. BrokerLink the Canadian Broker companies, subsidiaries of Network’s (CBN) new Intact Financial Corp., managing director. Most include offices recently84 serving asserving chief clients in Atlantic executive officer ofCanada, ingenie Alberta Ontario. Dating Canada,and Phair has held leadback more than 60 years, ership and board positions in MCT than industry 110 inboth has the more insurance surance professionals in 18 and in the not-for-profit offices. Michael Brien, who sector, notes a statement has MCTanover the last 12 fromled CBN, independent years, joins BrokerLink as commercial insurance broker head of its Atlantic operations. network in Canada.
6
7
5 4
10
7
Carolyn Snow [7] will lead RIMS as president for the 2014 term, which Global took effect tradeJanuary credit 1. Snow, insurer who hasCompagnie been on the RIMS Board of Directors for Française d’Assurance sevenleyears, is currently dipour Commerce Extérieur rector of reports risk management (Coface) that Sonia for Humana Inc. She previously Luengo [8] will lead the served as RIMS’s treasurer, Canadian team of risk secretary and taking director underwriters, onofthe external affairs. The RIMS role of Canada risk underwritboard for 2014 alsoAmerica includes ing manager, North vice president Richard Region Team. Luengo Roberts, Jr.; treasurer previously served in Julie Pemberton; corporate secresenior positions at financial tary Nowell Seaman, director institutions and insurance of global risk companies in management Canada and for Potash Corporation of Spain, including Scotiabank, Saskatchewan Inc.; Genworth Mortgage Gloria Brosius; Steve Pottle,Hermes. director Insurance and Euler of risk management services at YorkVericlaim University; Jennifer Canada, a Santiago; Janet Stein, direcsubsidiary of Sedgwick tor of risk management and Claims Management insurance at the University Services, Inc. and national
11
8
9
8
As of January 8, Toronto insurance broker Jones DesLauriers Insurance Management Inc. 5a (JDIMI) had acquired Whitley Insurance and Financial Services. Whitley provider of lossInsurance adjustinghas and offices in Belleville, Ontario claims management solutions, and acquired the nearby has thecommunities assets of of Trenton, Deseronto independent adjustingand firm Stirling. “TheServices, acquisition RGM Claims Inc.is expected to buildina solid RGM specializes presence forautomobile, JDIMI in Eastern municipal, Ontario and position the firm product and environmental to better service their clients, liability, as well as property, with strengthened commercasualty and cargo losses. cialaddition, and personal insurance In Ross Macdonald offerings in the region and his colleagues haveand a new financial services divijoined Vericlaim Canada. sion,” notes a statement from JDIMI. President and CEO Christopher Shawn DeSantis will lead the Harness, vice teams frompresident both companies. of soluLoris delivery Clarke [8] been tions at has Northbridge named successor to Paul Financial Corporation, is Whitley, president the newest memberofofWhitley the Insurance, who will remain Centre for Study of Insurance during a transition Operations’ (CSIO) period. Board of
10
Directors. Harness replaces Andrew Wood, Northbridge’s Ken Raynerofficer, [9] hason chief information joined Anderson the CSIO board. McTague & Associates Ltd. as its director of busiPeter Doublard ness development, Central [11] brings Region. “Ken brings a wealth three decades of of experience to our comexperience in the insurance pany, having industry to hisheld newvarious post as senior management positions senior adjuster in Kernaghan with insurers and other MGAs,” Adjusters Ltd.’s Hamilton,
9
11
says Chuck McTague, president of Anderson McTague & Associates, a familyowned MGA based in New Ontario office. Doublard Brunswick. in In large-loss January, Anspecializes derson McTague & Associates commercial and personal announced it was expanding, lines property, including adding an office in Toronto condo claims, builders risk to service the brokers of Ontario and specialty losses, notes Manitoba. Rayner’s aand Kernaghan Adjusters appointment confirms the bulletin. Previous employcompany’s ers include “commitment Granite Claimsto the Ontario/Manitoba marketSolutions and SCM Canada, place, and to the building his LinkedIn profile adds. of a local support team to assist brokers withSedgwick their surplus and lines and difficult to place its subsidiary business,” Vericlaim, McTague adds. a
12
global provider of loss adjusting and claims management Theannounced Guarantee solutions, have Company of further Canadian expansion North America with the opening of a new has announced office in Calgary.that “WeTara are Wishart [10] became vice moving quickly to expand president of footprint claims forand the our national insurer’s Toronto branch we are recruiting the beston December 2, 2013. Having experts in the industry in 21 years of experience each region/territory to in The Guarantee’s claimsthe service ensure we provide department, Wishart will be and quality our customers responsible for the operations deserve,” says Mike Holden of the Toronto Branch Claims. president of Sedgwick and She first joined TheAsGuaranVericlaim Canada. such, tee in 1995 ashas an adjuster Monte Ponton joined the and has held roles general of increasteam as executive ing seniority with will the work comadjuster. Ponton pany, including, most out of the new Calgary office recently, claims manager and manage large losses, for specialty lines. Wishart is a catastrophic and complex member of both the Surety cases in Western Canada. He Association and as has 37 yearsofofCanada experience Canadian athe loss adjuster.Association of Women in Construction.
10
Follow @CdnUnderwriter on http://twitter.com/CdnUnderwriter
October 2016 Canadian Underwriter February 2014 Canadian Underwriter
69 57
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
To help kick off the 2016 RIMS Canada Conference in Calgary, Sedgwick and Vericlaim hosted their guests to a RIMS Canada Conference reception at the James Joyce Authentic Irish Pub on September 10. The drinks were plentiful and the fare was exceptional. The event also provided great networking opportunities.
70 Canadian Underwriter October 2016
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
SCM Insurance Services hosted its annual RIMS Canada Conference ‘Customer Appreciation’ party at the beautiful Teatro Ristorante in Calgary on September 10. Guests enjoyed a wide selection of cocktails and fine hors d’oeuvres.
October 2016 Canadian Underwriter
71
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
Cunningham Lindsey Canada held its annual RIMS Canada Conference dinner on September 10th at Murrieta’s Westcoast Grill. Located in downtown Calgary and within the historic Alberta Hotel building (c.1890), conference guests experienced an evening of fine food, libations and conversation
72 Canadian Underwriter October 2016
APPOINTMENT
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
FirstOnSite Restoration hosted their annual RIMS Canada Conference ‘Meet & Greet’ cocktail reception on September 11 at Craft Beer Market in downtown Calgary. Conference guests were treated to great food and cocktails - including beer of course.
Nino Calabrese Xpera, Canada’s leading provider of Risk Mitigation & Investigation is proud to announce that Nino Calabrese has rejoined the firm as Director of Investigations, Toronto. Mr. Calabrese, who was with Xpera since 1987 under the company’s former name of CKR Global, has returned after a brief sabbatical to oversee day to day operations in Xpera’s Toronto office. A versatile professional, Mr. Calabrese brings over thirty years of experience in both corporate and insurance claims investigations with a reputation for providing exceptional litigation support to the insurance and legal community. A licensed investigator since 1984, Mr. Calabrese is the first Canadian to receive the prestigious Dennis A. Noggle Award which is given based upon several factors including response time, method and quality of reporting, flexibility, and consistent excellence and loyalty. “Xpera is proud to welcome Nino Calabrese back to our team,” states Paul McParlan, Vice President for Xpera Risk Mitigation & Investigation. “Nino’s breadth of experience and extensive expertise help makes our team stronger and affirms Xpera’s position as a leader in our industry.” Nino Calabrese is excited to bring his knowledge and skills back to Xpera Risk Mitigation & Investigation. He can be contacted at nino.calabrese@xpera.ca or by telephone at 416 449 8677.
xpera.ca October 2016 Canadian Underwriter
73
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY
As a warm-up for the 2016 RIMS Canada Conference, Calgary, Crawford and Company (Canada) Inc. held their annual RIMS Canada Conference dinner party on September 10 at Market Restaurant. Invited guests enjoyed wonderful food, beverages and engaging industry conversations.
74 Canadian Underwriter October 2016
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
October 2016 Canadian Underwriter
75
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY
The William H. McGannon Foundation held a special celebration during the 2016 RIMS Canada Conference, Calgary, in honor of the foundation’s founding father, William H. McGannon, as well as to recognize and thank the foundation’s donors and supporters. The event was held at The Belvedere in downtown Calgary. Among the attendees were students from the 2016 Student Involvement Program provided by the McGannon Foundation. On behalf of RIMS, RIMS President Julie Pemberton and RIMS Chief Executive Officer Mary Roth presented the McGannon Foundation with a donation of $45,000.
76 Canadian Underwriter October 2016
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
October 2016 Canadian Underwriter
77
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY
More than 70 companies and organizations providing products and services to the risk management community filled the Telus Convention Centre Exhibit Hall at the 2016 RIMS Canada Conference, Calgary, held September 11 to 14.
78 Canadian Underwriter October 2016
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
Continued on Page 80… October 2016 Canadian Underwriter
79
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY …Continued from Page 79... Exhibit Hall at the 2016 RIMS Canada Conference, Calgary.
80 Canadian Underwriter October 2016
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
October 2016 Canadian Underwriter
81
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY – DONALD M. STUART AWARD
ORIMS president Christina Gardiner presented the Donald M. Stuart Award to Mark Day, executive director of risk management and insurance for the Government of Alberta’s Treasury Board and Finance, at the 2016 RIMS Canada Conference, Calgary on September 13. Mark Day, executive director of risk management and insurance for the Government of Alberta’s Treasury Board and Finance, has had his many years of service and dedication recognized, becoming the latest recipient of the Donald M. Stuart Award. Presented during the awards luncheon on September 13 at the 2016 RIMS Canada Conference in Calgary, Day was bestowed what is widely regarded as Canada’s highest risk management honour, reports RIMS, the risk management society. The award, given out annually since 1979 by the RIMS Ontario Chapter (ORIMS), is meant to recognize those who have made outstanding contributions in the risk management profession and advancing risk management in Canada. Day is currently responsible for the overall delivery of risk management, risk control, risk financing and risk identification to all departments of the Alberta government, most provincial corporations, all of its committees, public and elected officials and its thousands of volunteers, notes the RIMS statement. Day is an integral member of Alberta’s Assistant Deputy Minister Recovery Task 82 Canadian Underwriter October 2016
Force, which has been instrumental in guiding the province through a number of recent natural disasters. He has also initiated a quarterly newsletter that provides an update on the latest risks having an impact on the provincial government and the region, thereby helping to promote a risk-aware culture across the governmental enterprise. Beyond his work-related accomplishments, Day has a long history of volunteering within the risk management community. Among other things, he has served as president of the Northern Alberta RIMS Chapter on two occasions, held several chapter officer and RIMS Canada Council positions, been a member of the National Education Sub-Committee of the Canadian Risk Management Council, was the catalyst for the University of Alberta’s decision to offer the CRM course, and has shared his considerable expertise as a conference speaker, educator, author and mentor. “Just like others did for me, I found it to be crucially important, and perhaps even my responsibility, to give back to the risk management community,” Day says in the
RIMS statement. Humbled to be recognized “for a lifetime of work that I have felt so passionate about,” he adds that “the value of the risk management function continues to gain traction and it has been exciting to be a part of this momentum.” ORIMS president Christina Gardiner notes that “to keep the risk management profession vibrant and integral to organizational success, we rely on industry leaders, like Mark Day, to generously share their invaluable career experiences.” Day, Gardiner adds, “has had a profound impact on the careers of countless practitioners and has demonstrated a true commitment to the future of risk management in Canada.” Also during the awards ceremony, David Chipp, project consultant of people performance and culture for Halifax-based Efficiency Nova Scotia, was announced as the recipient of the Fred H. Bossons Award. The award recognizes the risk management professional who earns the highest marks on the three courses required to receive the CRM designation.
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
The 2016 RIMS Canada Conference ‘Resilience’ was held in Calgary, from September 11-14 – Local Organizing Committee Chairs Phil Corbeil and Janet Stein welcomed all delegates to the conference. The Conference Program included a robust line-up over the span of the event including keynote address on resilience, by Calgary Mayor Naheed Nenshi and opening plenary session with Neil Harrison from Aon and Alan S. Kurth from Marsh, shared their 9/11 experience with resilience, recovery, and moving onward, moderated by Joanna Makomaski.
If you’re in Manitoba, this is considered an automobile. Surprised? ARC isn’t. Your customer has a list of the vehicles that are covered by your fleet policy. You have a list of the vehicles that are covered by ARC Group Canada is a national that policy. network of independent law firms, And your lists aren’t theintimately same. each connected to their local market. When the one vehicle that is involved in Insurance risk appear management an accident is the one thatand doesn’t on experts. Regionalnext? strength. both lists, do you know what happens National scope. ARC does. That is the ARC Group.
If y Manitoba consid auto
Surp
ARC Group Canada network of independ each intimately their
Insurance and risk experts. Regio Na
That is th
Go to As
Go to AskARC.com
ARC Group Canada is a national network of independent law firms, each intimately connected to their local market. Insurance and risk management experts. Regional strength. National scope. Go to AskARC.com
The ARC Legal Reporter Winter Issue – Article #1 A National Network of Independent Law Firms
When is a medical examination considered a second examination under Rule 36 of the New Brunswick Rules of Court?
The ARC Legal Reporter v. Crowther and Kelly Case: Winter IssueReported – Article #1 Blyth 2009 NBCA 80 Citation: A National Network of Independent Law Firms
At Issue:
When is a medical examination considered a second examination under Rule 36 of the New Brunswick Rules of The Court? Court: ARC_Fleet ad_1/2 page.indd 1
Reported Case: Citation:
Blyth v. Crowther and Kelly 2009 NBCA 80
Judgment Rendered: Factual Summary:
When both the plaintiff’s physical and mental condition are in issue in an action, an the plaintiff undergoes a physical examination, will a subsequent application for psychiatric examination be considered an application for a second medic examination?
Should medical examinations that are ordered as part of the discovery process b characterized as ‘independent’ medical examinations? Court of Appeal of New Brunswick October 13, 2009 (Reasons delivered November 2015-02-14 26, 2009) 1:05 PM The plaintiff suffered injuries in a motor vehicle accident and commenced an actio seeking damages. Both the plaintiff’s physical state and mental state were in issue the action. The plaintiff submitted to a physical examination by the defendant’s expe but subsequently refused to submit to a psychiatric examination.
GALLERY – 2016 RIMS CANADA CONFERENCE CALGARY See all photos from this event at www.canadianunderwriter.ca/gallery
AIG hosted a reception at the RIMS Canada Conference, Calgary to mark the company’s 50th anniversary in Canada. The event was hosted at the Glenbow Museum on September 12. Guests enjoyed full access to the museum, where, during the reception, Lynn Oldfield, AIG President & CEO, presented a cheque to the McGannon Foundation in support of risk management education. Also on hand during the presentation, were six risk management students who introduced themselves to a room full of potential employers.
84 Canadian Underwriter October 2016
We are Markel. Commercial general liability Cyber risks insurance Directors and officers liability Environmental impairment liability Life sciences Professional liability Property and inland marine Security and protection industry Umbrella and excess liability
Helping brokers with effective insurance solutions since 1966 Calgary Montreal Toronto Vancouver www.markelinternational.ca
CA corp advert CU 8.125x10.75.indd 1
14/03/2016 13:44
INTRODUCING
AUTOMOTIVE SELECT Recognizing the needs of small and mediumsized automotive service stations, our flexible Automotive Select packages provide insurance to fit growing businesses.
Learn more at wawanesa.com/automotive
AUTO
HOME
BUSINESS
FARM
LIFE AND GROUP
wawanesa.com