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Distribution Strategy

Distribution Strategy. The Co-operators Group Ltd. Paul Hanna, VP Strategic Planning ICMIF November 2013. Our Organization. Our Members. Our target customers include: Individuals, businesses Affinity groups Members and their members

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Distribution Strategy

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  1. Distribution Strategy The Co-operators Group Ltd. Paul Hanna, VP Strategic Planning ICMIF November 2013

  2. Our Organization Our Members Our target customers include: • Individuals, businesses • Affinity groups • Members and their members Our main lines of business by direct written premium are:

  3. Canadian Market Overview • Predominant channels • Trends • Customer preferences evolving to favour direct channel with technology changes • Steadily declining Non-Life Broker market share (last decade) • Increased presence of multi-channel distribution models • Importance of seamless experience across all channels • Blurred lines between Insurance and Investment Advisors Source: LIMRA Source: MSA Source: FraserGroup

  4. 496 Co-operators Advisors, over 680 retail outlets across Canada Extensive Broker network over 4,000 strong 5 Contact Centres 350 credit unions

  5. Our Distribution • Advisors – Exclusive contract with Co-operators to sell and service Co-operators branded products. The company owns the relationship with the client. • CGIC • CLIC • TIC Brokers - Act as an intermediary between a variety of companies and the client. The broker owns the client relationship, not the company. • Sovereign General • CUMIS • CLIC • Direct - In direct relationship with the client through the sales and service process through the web, on the phone or face to face. The company owns the relationship with the client. • Coseco • CUMIS • TIC Credit Union – Credit Union personnel sell directly to their Members. • CUMIS

  6. Analysis • Challenges of current strategy/structure • Demographic of advisor force (filling the retirement gap) • Integration across channels and channel conflict • High cost of captive advisor force • Contract changes to favour advice focus • New opportunities • Advisory relationships - focus on advice-based products • Expansion of wealth management capabilities and reach • Changes in progress • Undergoing a complete Distribution Strategy Review • Technology evolution and adoption is changing the competitive landscape • Aggregators are a growth channel (Auto, Home) • Introduced the possibility of game changers with established distribution networks (new entrants like Walmart, Google etc.)

  7. Implications • As a co-operative we are well positioned to: • Inspire trust and build deeper advisory relationships with our customers that span many products/services • understand the needs and preferences of our customers and members but we will need to act as they evolve • Our physical presences in the communities in which we do business will continue to be important even in an increasingly digital world • Technology will be critical to distribute commodity type products, advisors can offer value-added on advice based products (Call, Click or Come In) • Transition from Reactive Service -> Proactive Sales • Technology evolution and adoption is changing the competitive landscape • Aggregators are a growth channel (Auto, Home) • Introduced the possibility of game changers with established distribution networks (new entrants like Walmart, Google etc.)

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