General

2013 Year in Review

Mr. Bernard Tanguay, Senior Vice-President of Individual Insurance and Investments, reviews the past year.

 

How did the markets influence your business decisions in 2013?

Low interest rates were certainly a key factor in 2013. On the investments side, the economic context combined with the new, more stringent standards governing capital requirements unfortunately forced us to withdraw our Guaranteed Minimum Withdrawal Benefit (GMWB) product, along with the vast majority of insurers.

In life insurance, insurers realized at the beginning of the year that it would be months, perhaps even years, before we saw any significant and sustained increases in interest rates. The series of rate increases which had already begun on long term products continued during the first quarter. Fortunately, these rate adjustments slowed in the second half of the year following the increase of close to 1% in long-term rates. We now believe that these rate adjustments are for the most part behind us and that products with long-term guarantees are here to stay.

 

How has business outside Quebec been since the acquisition of AXA?

We are thrilled with the results so far. In 2013, just two years after the acquisition, sales outside Quebec have quadrupled and our sales continue to show strong growth.

On the investments side, the transaction enabled SSQ to rely on AXA's Canadian sales force to promote its segregated funds outside Quebec. We can now count on sales offices in Toronto, Calgary and Vancouver, and our seg funds sales outside Quebec already represent nearly 20% of our total sales. The recent arrival of Doug Paul as Vice-President of Business Development will also definitely have positive effects on our sales strategies outside Quebec.

 

With the new year just around the corner, are you able to summarize results for 2013?

2013 confirmed that the acquisition of AXA's life insurance operations was a sound decision. Not only are the business synergies we identified prior to the transaction on par, they have exceeded our expectations. Proof of this is that, while sales in the industry are increasing at a rate of 6% per year, our sales increased by 34% in 2012 and 80% in 2013. We have also made tremendous strides in 2013 to introduce a culture of high quality service to the new subsidiary, something that has always defined SSQ. We hired additional employees, mainly in the new business sector. We are aware that there is still a lot of work to be done and that we can count on a dedicated team that shares the same ambition.

We are particularly happy that our Astra funds did so well with the strong market growth in 2013. The growth rate of our seg funds gross sales was twice that of the Canadian market in 2013.

 

What are your objectives for 2014?

To pursue the same ambitious objective of making SSQ an insurer with whom it is easy to do business, for both insurance and investments needs. The two underlying objectives are to continue to improve our client experience and continue to diversify our range of products.