SGI completes sale of 75% stake in Insurance Company of PEI

EGI Financial Holdings Inc. announced Wednesday it has completed the purchase, from Saskatchewan Government Insurance (SGI), of a 75% interest in Insurance Company of Prince Edward Island.

Charlottetown-based ICPEI writes auto, home and commercial insurance through brokers in Prince Edward Island, New Brunswick and Nova Scotia.

Cooke Holdings Inc. continues to hold the 25% of ICPEI that EGI does not own.

SGI, a Saskatchewan provincial crown corporation, initially announced March 28 its intent to sell its stake in ICPEI. SGI administers the Saskatchewan’s compulsory Auto Fund and provides property & casualty insurance in Saskatchewan under the trade name SGI Canada. SGI also provides p&c insurance in Alberta and Manitoba through SGI Canada Insurance Services Ltd. and in Ontario through Coachman Insurance Company.

SGI stated in March it “plans to redirect resources to strengthen focus on Ontario and Western Canada.”

SGI has applied for a licence to sell p&c insurance in British Columbia. Also in March, SGI president and CEO Andrew Cartmell stated B.C. “fits with SGI Canada’s plans to build expertise in providing insurance to Western Canadian industries such as mining and oil and gas.”

Toronto-based EGI writes non-standard auto and other specialty insurance in Canada through Mississauga, Ont.-based Echelon General Insurance Company. Echelon General also has offices in Laval, Que. and Penticton, B.C. As of March, 17% of EGI was owned by The Co-operators Group Ltd. and its affiliates. Until 2005, The Co-operators had owned 50% of EGI.

EGI last year sold its United States operations to White Pine. EGI had been writing non-standard auto through American Colonial, which it bought for about US$4.6 million in 2010. Last year, American Colonial was writing new and renewal non-standard auto in Florida. It also had licenses in Georgia, Louisiana and Alabama.

When it first announced the sale of its U.S. operations in August, 2013, EGI said at the time it would “remain responsible for the run-off of its discontinued Texas operations.”

EGI also writes specialty insurance in Europe (mostly in Britain and Denmark) through a majority-owned firm, Qudos Insurance A/S. Qudos is based in Denmark and writes motorcycle, taxi, non-standard auto and warranty insurance.

SGI agreed in March to sell its 75% stake in ICPEI at book value — estimated at the time at $10 million — and “an additional $3.5 million to license the use of SGI’s computer systems.”

At the time, SGI Canada said its employees supporting ICPEI business were located at its head office in Regina and none of them would lose their jobs or have to relocated as a result of the sale.