27 June 2017 07:00
Michel Duval and David Morin | Photo : Réjean Meloche
A lifting of the limit of 20 % ownership would allow the dealers to play on equal terms with the direct, argues the Alliance for a brokerage stronger. However, its founding members do not expect to dispose of the capital if it is abolished.
This is what reported in the Journal of insurance Michel Duval and David Morin, respectively CEOS of the firms ESSOR Insurance and Courtika, which are part of the Alliance. The interview took place on may 24, in the office of development.
If the Alliance has seen the light of day, it is to hear the voice of his 13 firms founders. They focus all their volume in individual insurance fromIntact Insurance. The insurer is also at the origin of the discussion that led the ministère des Finances du Québec to launch a consultation on the subject, which had ended on 23 June. At the closing of this edition, 14 June, 76 firms adhered to its proposal.
«The Regroupement des cabinets de courtage d’assurance du Québec (RCCAQ) has about 300 members. Of this number, there are firms of different sizes, but also differing business models. They are not all at the same point with regard to their reflection on this what it will look like the brokerage of the future «, said Mr. Duval.
The RCCAQ listening
And the Alliance has also emphasized have been listening to the RCCAQ on this topic. Also, on the morning of the interview, MESSRS. Duval and Morin participated in the table of the great offices of the Consolidation and have presented the proposal of the Alliance. «The last few presidents of the RCCAQ have defended the principles of all models business as a professional union over the last five years. I take my hat off to this effect «, said Mr. Duval.
The Alliance has filed with the department its memory, which will be different from that of the RCCAQ. «Our memory is not against them. It is very important to deal with what comes «, say the two men.
And that will happen in the event of an abolition of the rule of 20 % ? Is it that the 13 firms, the founders of the Alliance are going to yield more of the capital or the shareholding of an insurer ? No, responded MESSRS. Duval and Morin. «It will be free for everyone to take the decision it considers best. In the short term, I don’t see any change. It will not change anything in my office in any case «, said Mr. Morin.
He added that the owners of the member firms of the Alliance are all entrepreneurs who want to growth. «We live the same problems of shortage of labour and others. As the ministry of Finance of Québec has shown openness to discuss the limitation of ownership imposed on the brokerage firms, we have seized the opportunity, » said Mr. Morin. The law is deficient. It is not modern. We are not convinced that it could be written so as to enable brokers to meet the challenges of tomorrow. «
«Prospects sombressi nothing is done»
During the creation of the Alliance, Mr. Duval pointed out that the future prospects of the brokerage firms would be dark if they could not have access to new sources of funding. He recalled that the market share of the insurance brokerage private individuals was 85 % before the Desjardins group decides to invest in direct distribution and abandon the brokerage. It is no more than 43 % today, » he stressed.
«One of the trends that we will know, this is the digital way,» said Mr. Duval. It is at the beginning. Profound changes are on the way, including in our operations. It will require major investments in the coming years. And in Quebec, we are fighting against Desjardins, which manages assets of $ 250 billion (G$). They have the resources to deal with this. Individually, the broker does not have access to these resources. And it is necessary to think of this in a set, which includes technology, marketing and operations. «
Mr. Duval added that the way of doing affairs of the industry will change. AirBNB is the largest hotel chain in the world. However, it does not have a hotel. The insurance industry is going to go through with it.w «
The Alliance hopes that the brokerage has the same chest of tools than its competitors, said Mr. Morin. «There is a light at the end of the tunnel. We must fight as an industry. We will then come to regain market share, and quickly. But you have to fight. I’m still young and I want to stay in brokerage for a long time. «
Keep the title of broker
The dealers that would work in a new business model where an insurer would have a share of ownership greater should retain the title of broker, says the Alliance. For Michel Duval, it must not be forgotten that the law firms that concentrate work in the two spheres are very different to when they are insurance companies.
«It is considered in its entirety, said Mr. Duval. If one combines the two segments, there is not a dealer in Quebec that has 50 % of its volume in a single insurer. Even individual insurance, there is not a broker-dealer that focuses 100% Intact. They all have a second market. «
Mr Duval said that it is also necessary to take account of the state of the pricing in motor insurance. In Quebec, the average premium is a little over $ 500. In other provinces, there are places where it is close to 2 000 $, » he said. «There is a question of profitability to consider, said Mr. Duval. Often, we serve clients for their insurance needs of private individuals and insurance companies. The dealer then takes all its meaning. «
David Morin adds that the dealer is part of its DNA, but also that of his company and its employees. «We are there to advise the client and offer him the best product. There will always be a broker, regardless of the change in the law. There is ! «
By its demands, the Alliance also wants to come to this, that the definition of broker be modernised, said Mr Duval. «We are fighting against larger players as a broker. We want to be able to ally with partners. We don’t want to be struggling with the notion of influence that an insurer could exercise on a broker. It has no place to be. «
They argue that this debate does not touch the brokers who concentrate or have a business relationship with an insurer. Brokers of all kinds are concerned.
«We are all entrepreneurs,» said Mr. Duval. And as an entrepreneur, everyone is free to choose its model. We are in a capitalist system. It brings a freedom of choice. «
Mr. Morin adds that the disclosure has a great role to play. «An environment free of limitation does not mean that the consumer will be held hostage. If it is well done, clear, and unambiguous, and that the person knows with what kind of business it deals with, a good disclosure will do a good job. «