In an exclusive interview with The Insurance Journal, Robert St. Denis, president and chief executive officer of La Capitale Financial Group, summed up his approach in two words: global vision. This global vision, he explains, involves spurring the growth of all La Capitale’s areas of operations by emphasizing three pillars: patience, humility and innovative products.
Although the insurer sees its largest growth taking place in Quebec, La Capitale is continuing to increase its investment in its national growth strategy.
La Capitale is earmarking $4 million for market development outside Quebec. "We will invest a growing amount in the years to come. We’re fine in Quebec, and we feel the need to venture further afield."
Mr. St. Denis adds, however, that La Capitale will not rush its expansion. He began the strategic interview by announcing, "We will develop the market outside Quebec intelligently, as opportunities arise."
Accentuating its relationships with managing general agencies (MGAs) is key to growth inside and outside Quebec. When it launched into life insurance brokerage a little over a year ago, the insurer started from zero. Now, La Capitale has relationships with several MGAs. The insurer’s objective is to establish lasting partnerships and good communication.
"The message we convey is that we’re not an insurer that aims to meet every need; we complement others. Our offer is finding its niche," he says.
According to Mr. St. Denis, approaching an MGA with the hopes of replacing Sun Life Financial or Manulife Financial is impractical. The winning approach, in his view, consists of convincing advisors that as a new supplier, La Capitale can help them by offering products that complement their current line.
Being a good listener, providing good service and issuing policies quickly, are also essential. "We have to cultivate added value, or the battle will be waged on prices, and small players cannot win that war," states Mr. St. Denis.
"We entered brokerage humbly, and I think that independent advisors and MGAs feel respected; this has driven our success."
Mr. St. Denis says that La Capitale has exceeded its brokerage objectives. "In 2006, we gave ourselves three years to reach our objectives. In fact, we will meet them before the end of the third year. By year-end, we expect our growth to be double that of our objective for 2007."
In group insurance, La Capitale’s development of the market outside Quebec rests on two assets: AGA Financial Group and Penncorp. AGA, the group insurance firm acquired by La Capitale in 2005 will continue to develop its markets independently. Active outside Quebec since 2006, AGA is currently dealing with a third party administrator, RWAN, a firm situated near Kitchener, Ontario.
When it acquired Penncorp in 2006 (see inset text), La Capitale gained a network of representatives to which it has already begun to supply its own made-in-Quebec products. These products will be gradually marketed under the Penncorp brand, Mr. St. Denis confirms.
In parallel, Penncorp products will soon be offered in Quebec.
New products by La Capitale include one that was designed with one of its distribution partners, Groupe Cloutier, called the T20/10, and was launched in 2006. The first of its kind, this term insurance product lets policyholders choose the duration of the contract after the tenth year rather than at issuance. Insured that pay a T20 premium can get a refund after ten years if they choose the T10 option. They can also choose to renew the insurance for another ten-year term.
The insurer recently pioneered another product: Source. Rather than paying out a single lump sum, this term insurance offers guaranteed non-taxable monthly income to the family after the death of the insured. Payment options range from $500 to $10,000.