Canadian Underwriter

More room for industry consolidation and Intact wants to keep growing: CFO

August 11, 2021   by Greg Meckbach

Print this page Share

Intact is probably not finished acquiring more Canadian insurers even with its recent acquisition of RSA Canada.

On June 1, Intact closed a three-way deal in which Intact and Tryg A/S acquired London-based RSA plc. As a result, Intact now owns former RSA operations in several nations including Canada, Britain and Ireland.

During an online UBS event Tuesday, an audience member asked Intact chief financial officer Louis Marcotte how big Intact can get in Canada.

“The P&C market remains very fragmented in Canada despite us having a fairly high market share. But we don’t see that as being an impediment, in the short term, for further growth in the Canadian marketplace,” Marcotte replied.

Market share is evaluated by product line and by geography, Marcotte said during the virtual fireside chat, hosted by Brian Meredith, managing director and North America equity research analyst for insurance at UBS.

“When you look overall, there are some areas in which we are more concentrated than others. But overall, our view is [the RSA Canada acquisition] is not any kind of tempering of our opportunity in the Canadian marketplace. There is still room to consolidate and we intend take advantage of that if the opportunities come up,” said Marcotte.

The Intact-Tryg-RSA deal was first announced in November, 2020, about a year after Intact closed its acquisition of The Guarantee Company of North America and Frank Cowan Company from Princeton Holdings. Other major Canadian carriers acquired by Intact include Jevco in 2012 and AXA’s Canadian operation in 2011.

In November, 2020, Intact CEO Charles Brindamour said the RSA deal will increase Intact’s direct premiums written from about $12 billion to $20 billion a year. Intact’s head count will grow from about 16,000 to 26,000. The deal was valued at about £7.2 billion, with Intact paying £3.0 billion and Tryg paying £4.2 billion.

At the moment, Intact and Trgy own 50% each of RSA’s former Denmark operation, known as Codan DK. On June 11, Intact announced a deal to Codan DK to Danish financial services firm Alm.Brand A/S Group for about Cdn$2.52 billion. That deal has yet to close.

During Tuesday’s UBS Financial Services Conference, an audience member asked about the reaction of Intact’s broker partners to the RSA deal.

Overall, the reaction has been very good, replied Marcotte.

“We don’t see a lot of dislocation in terms of distribution. I do not expect any visible impact from any distribution challenges,” he added.

“There are always a few pockets of resistance here and there but they are not very significant,” said Marcotte.

“It’s hard for brokers to completely step away from Intact, to be fair, not just because of size but because we provide quality service to our broker and to our customers.”

Print this page Share



Have your say:

Your email address will not be published. Required fields are marked *