28 February 2018 13:30
Photo : Freepik
Announced in the beginning of the week, the acquisition of PPI by ai financial Group has stoked the concerns of the general agents on the fate of the independent distribution network.
It is the most recent in a series of acquisitions completed by ai in the distribution network, including the Management of heritage Hollis.
Great-West has also acquired an agent-general major in 2017, is Group financial Horizons.
“The integration of MGA by providers is certainly a growing trend and concern. I don’t see just how you can tell that you value independence and would like to offer a impartial counsel… and belong to a vendor, ” responded Terri Botosan, president of the Financial Hub. This independence is crucial for an agent, she insists.
Ms. Botosan said that his role in this radical change of the landscape of the distribution is to help independent advisors ” to navigate these changes and remain focused on the important “. “We will continue and I think we have ample opportunity to do so,” she said.
CEO of Qualified Financial Services (QFS), Kevin Cott has sent a message to the advisors after the announcement of the sale of PPI. “Yesterday’s announcement of the sale of PPI is one more example of the radical changes that occur in the model of insurance distribution in Canada. Following the footsteps of Great-West, which has gained financial Group Horizons, it is one more proof of the changing landscape in which suppliers can now see independent advisors as their property, thus limiting their ability to act with independence in the interests of their clients, ” wrote Mr. Cott.
Other sales in order
It seems inevitable, the president and CEO of QFS that another great MGA national, which is not a private company, “will follow soon, while their owners seek to leverage their investments and to crystallize their value,” he says. “Do not be deceived, these changes can, and will have a significant impact on your business in the future,” added Mr. Cott for councillors.
It states that QFS, a private company, ” has no intention of joining this group.”
CEO of IDC Worldsource Insurance Network (IDC WIN), Paul Brown said that he did not fear for the ability of PPI to remain independent under the leadership of iA. “I do not think that PPI will become less independent. Why would you buy a company with a history of 40 years and the change ? Obviously, industry will say that they are less independent, but I don’t see it. “
In an interview with the Journal of insurance, Jim Burton, president of the board of directors and CEO of PPI, has reiterated its commitment to the preservation of the independence of the advisors.
Mr. Brown stated that it would not be surprising if this sale given the relationship between MIP and iA. “A firm the size of PPI could be bought by a large insurer or a private investor,” he said.
Speculation to come
He added that there will certainly be discussions around the intentions of IDC WIN, following the sale of PPI. “Obviously, there will be speculation about a firm, such as ours. We are the property of a public company that has invested in us for the growth and sustained profitability. We don’t look for an event of liquidity, and we see this as an opportunity for growth “, he said.