Desjardins’ acquisition of The Insurance Company of Prince Edward Island (ICPEI) will enable the direct writer to diversify its distribution model and expand its national reach, Desjardins General Insurance Group president and chief operating officer Valerie Lavoie tells Canadian Underwriter.
The acquisition is also closely linked to Desjardins’ commercial lines strategy, Lavoie shares.
“[We] distribute insurance via our exclusive agents, and now we want to reach a broader market, and take advantage of an insurer that is distributing their products by brokers,” Lavoie says.
ICPEI will be Desjardins’ broker-distributed subsidiary upon the deal’s close, upon which Desjardins will add ICPEI’s home, auto and commercial insurance activities to its current operations.
“Desjardins has a very big ambition to develop commercial lines in Canada,” Lavoie says, “and this transaction is really aligned with our ambition to grow in commercial lines.”
The broker distribution model is particularly important for the small- to mid-sized commercial market, says Lavoie.
“[Our] direct model is really still relevant to the market,” she says. “However, we know that with a direct [model], when it comes to more complex risks…I would say a broker model fits better for these kinds of entrepreneurs’ needs in insurance. So, this is why we are excited to go there.”
Lavoie says, “we’ll rely on ICPEI’s expertise to grow in our commercial lines. We will take their expertise in commercial lines, we will take their expertise with brokers, and we are very happy to add this company to reach a market more broadly.”
ICPEI is based in Charlottetown, PEI, but operates across eastern Canada via the Atlantic provinces, Ontario and Quebec, thus further expanding Desjardins’ eastern presence.
As for Desjardins’ greater M&A plans, “we are always looking for opportunities in the market,” says Lavoie.
Feature image by iStock.com/Andrii Yalanskyi
