September 28, 2018 by Greg Meckbach
Kingsway Financial Services Inc., which used to own Jevco and York Fire and Casualty, plans to relocate to the United States.
Toronto-based Kingsway no longer writes property and casualty insurance in Canada, but it still has a Toronto head office and is traded on the Toronto Stock Exchange. The company announced Friday it plans to change its jurisdiction of incorporation from Ontario to the U.S. state of Delaware, subject to shareholder approval.
Moving its jurisdiction of incorporation to the U.S. will have tax advantages and “reduce operating expenses and transactional inefficiencies that currently result from being subject to Canadian corporate laws despite having no operations in Canada,” Kingsway said Friday.
Despite the fact that Kingsway’s head office is located in Toronto, Kingsway’s key executives work out of Itasca, Ill., a suburb of Chicago. The Itasca office will not move following a change of jurisdiction of incorporation. If the proposal is approved, it means Kingsway would no longer be traded on the Toronto Stock Exchange and would, in effect, cease to be a Canadian firm.
Kingsway wrote nearly $2 billion in premiums in 2007, with 29% of that business being written in Canada. At the time, its core lines included non-standard auto, trucking, motorcycle and taxis.
Last year, Kingsway reported $137 million in gross premiums written, mostly from six U.S. states.
Today, Kingsway provides warranties for vehicles and for refrigeration and heating, ventilation, air conditioning (HVAC) equipment in the United States.
Kingsway is now getting out of the non-standard auto business. It announced an agreement in July to sell Mendota Insurance Company and Mendakota Insurance Company.
Last year, most of Kingway’s non-standard auto premiums, through Mendota, were from motorists in Florida, Texas and California. The sale of that business “represents the end of an era for Kingsway and its long history of owning property-casualty insurance companies in both the United States and Canada,” Kingsway CEO Larry G. Swets stated Aug. 1, 2018.