Gerald Bouwers, President and CEO, Industrial Alliance Pacific Insurance and Financial Services Inc.

Gerald Bouwers, Industrial Alliance | BCBusiness
Industrial Alliance president and CEO Gerald Bouwers believes the company’s location in Vancouver gives it a leg up on its eastern competitors.

Gerald Bouwers, President and CEO of Industrial Alliance Pacific Insurance and Financial Services Inc., discusses ways he helps set the company apart in a sea of big insurers.

The big three in Canada’s insurance industry – Sun Life Financial, Manufacturers Life (Manulife) and Great-West Life – are all, perhaps unsurprisingly, based east of Manitoba. Yet, though technology has made it easier than ever to run a national business regardless of time zone, that Industrial Alliance Pacific is based in Vancouver is part of what sets it apart from its competitors.

“Most people know that we’re the only life insurance company that’s actually in the Prairies and the West,” agrees Gerald Bouwers, president and CEO of Industrial Alliance Pacific. “We don’t have numbers that show our penetration compared to our competitors,” he continues, “but my guess is that we would have a higher penetration, especially in B.C.”

Of course, that’s not the only reason IA Pacific posted revenues in 2011 of just over $1 billion, managed $6.1 billion in assets and ranked as the eighth-biggest private company in B.C. Diversified business in two niche markets is one of its primary success factors. These markets are creditor insurance products (also known as payment protection insurance in case of loss of life, disability or critical illness), which IA Pacific provides through automobile dealerships; and special market risks insurance, which encompasses accidental death and dismemberment – among other specific needs of special occupations often ignored by insurance providers. “We don’t compete with the big three in those niche markets,” says Bouwers, adding, “there’s still strong competition, but we’ve been in the those markets for 50 years and have a good track record.”

In creditor insurance, IA Pacific is the only company to have a nationwide distribution network through motor vehicle dealers, with sales offices in Halifax, Quebec City, Montreal, Toronto, Winnipeg, Edmonton and Vancouver servicing more than 440,000 individuals. In 2011, creditor insurance sales from IA Pacific alone totalled $230 million ($265.9 million including Industrial Alliance), an increase of 56 per cent over 2010.

Bouwers is confident these niche markets will continue to be successful, despite IA Pacific’s merger with its parent company, Industrial Alliance Insurance and Financial Services Inc., which at press time was scheduled to be finalized on June 30, a move toward streamlining both companies’ regulatory compliance. Bouwers insists the merger was not for cost efficiencies, but to consolidate regulatory processes, and that there will be no staff losses. While Vancouver will lose its ‘head office’ status to Quebec City, both creditor insurance and special markets will still be run out of B.C.

The merger clearly changes the company’s organizational structure, but Bouwers cites several other factors for IA Pacific’s recent success that will continue to prove fruitful: its strong partnerships with both the customer that buys its products, and the customer that distributes them; and talent management programs and succession planning that will ensure its organizational structure remains strong. Bouwers, who turns 63 this year, says Industrial Alliance has been the “ideal” parent company, providing support and capital in a non-interfering manner.

How the parent-subsidiary relationship will change with the merger remains to be seen, but for Bouwers, prudent management of capital, assets and liabilities is paramount, as is continued growth in diversified markets such as extended warranties, which has few long-term assets or liabilities. Perhaps one day soon, Industrial Alliance will be one of the biggest names in Canada’s insurance industry.