A measure of the ‘dullness’ of Canadians used to be the fact that we bought more insurance than almost anyone else in this world. As a result, when all else failed when choosing a career path, there was always insurance.
My oldest friend in the world had a father who spent his entire career at Great West Life. Winnipeg has not been home to a lot of major head offices, but there were lots of jobs in insurance. Great West grew over the years by gobbling up others, including London Life.
Then, this past week came the announcement that they were cutting 1500 jobs across Canada, including 450 positions at head office in Winnipeg. Two reasons were given, more competition for insurance business, and technological change. Can computers really determine how much insurance I need?
In any of my insurance dealings, it’s been personal relationships that have made the difference when it came to deciding what to buy. Even compulsory vehicle insurance which has long been in the public sector in both Manitoba and Saskatchewan, has been able to operate smoothly and efficiently thanks to individual agents and brokers.
The financial stakes are enormous. The total profits of insurance operations in Canada last year was more than $14 billion. Great West Life has assets under management totaling $1.3 trillion in a total of a dozen countries. No wonder the banks have long wanted to get into the business, so they can take an even larger slice of Canada’s economic pie.
The Conference Board of Canada recently forecast that the insurance business might be rather ‘flat’ over the next few years. We have an aging population, so the industry will be paying out a lot in claims as the Boomers pass on.
Sales of big boats and other expensive toys that have to be insured are not what they were a few years ago.
What I’m hearing in all of this, the insurance business is not likely to lose money ever, but profits may be lower for a while. Too bad.
I’m Roger Currie