Three local mutual insurance firms that protect more than $10 billion in area goods and property are in the process of amalgamating. They have only one goal in mind – better customer service.
John Leeson, president and CEO of North Kent Mutual, said the amalgamation of the Kent & Essex, North Kent and West Elgin mutual insurance companies is being done with policyholders in mind, as they are the owners of the mutuals.
“We aren’t closing offices, we aren’t reducing staff or anything of the type,” he said. “The entire reason is to allow us to pool our resources and expertise and better serve our members.”
North Kent board of directors chairman Scott Kilbride said discussions began about 10 months ago. Board, member and regulatory approvals are expected to be received by year’s end.
“We’re confident there is an excellent business case for the amalgamation,” Kilbride said. “We will emerge a stronger company which can offer our members state-of-the-art service and the personal touch which sets mutuals apart from other insurance companies.”
Leeson joked that the only casualty of the amalgamation is himself. He’s retiring at the end of 2014.
“It’s a great way to cap my career,” he said, although he will be available for special projects as needed.
Leeson said North Kent is the “baby” of the three firms.
“We’re only 103 years old.”
North Kent, headquartered in Dresden, has 6,400 policies and annual premium revenue of $8.4 million. Kent & Essex, whose head office is in Chatham, has 16,800 policies and premium revenue of $23.7 million. Dutton’s West Elgin mutual has more than 8,000 policies and annual premium revenue of $11.2 million.
Plans are for the new entity to be headquartered in Chatham, with Essex-Kent current CEO Joanne Vansevenant assuming the role of CEO for the new company, while West Elgin’s CEO, Brian Downie, will assume the newly created role of COO (Chief Operations Officer).
In order to inform members, the group has established a website, www.mutuallystronger.ca, which has information on the matter.
Leeson said the amalgamation would mean the new firm will be in a stronger position in terms of 24-hour claim services, online interfaces and mobile applications.
“As our customers change and expect more, we have to be able to meet their needs,” he said. “We have a strong reputation for providing cheques for at least a portion of claims the next day following a catastrophic event such as a fire.”
Leeson said the firm will have a stronger position when bargaining with re-insurers and in meeting the demands of industry regulations.
“Whereas we have three firms which have to fulfill regulatory obligations, we will be able to do it once and devote the resources used for that to providing better customer service.”
He said it also has the potential of increasing dividends to members.
“We returned $750,000 to policy holders last year. The amount returned is always dependant upon the kind of year we’re having, but we anticipate the amalgamation to help us in this regard.”
Kilbride said the mutuals commitment to community will continue, noting that North Kent gave away $100,000 to various causes in the area to mark its centennial three years ago.
“This is where we live and do business,” he said. “Giving back to the community is a big part of what we do and that won’t change.”