RBC Insurance has cancelled contracts with all but 14 of its MGAs.
According to sources familiar with the matter, RBC had 83 MGAs until this week.
John McMeans, vice-president of sales and brokerage at RBC Life Insurance Company, issued this statement to Advisor.ca.
“We are evolving our MGA strategy to focus on a smaller number of national and regional MGA partners who have access to our key markets and clients whose needs align with our revised product suite,” he says.
“This strategy will allow us to enhance our service levels to our MGAs and their advisors, and also help us prepare for upcoming heightened regulatory and compliance requirements. We are currently in the process of transitioning all our MGAs to our new strategy.”
Casey Brandreth, vice-president of business development at Daystar Financial, confirmed to Advisor.ca that Daystar is still one of RBC’s MGAs, adding he’s aware RBC has severed contracts with several other distributors.
He says RBC’s move was a logical next step after the insurer trimmed its product shelf.
“With the product change review, they made a change of their whole distribution network and methods,” he says, “so the [decisions] went hand in hand.”
This reduction in MGA contracts is reflective of an industry-wide trend, says Byren Innes, senior vice president and director, NewLink Group.
“For many years, companies have been shrinking their MGA lists and focusing on a few special relationships,” he says. “In this case, it appears the remaining MGAs are well-distributed for a national presence. This is RBC’s second round of consolidation; they’d approximately halved their MGA list a few years ago.”
RBC Insurance’s remaining MGAs are:
- Gryphen Advantage
- PPI Solutions
- PPI Advisory
- Hub Financial Inc.
- IDC/Worldsource Insurance Network
- BFG Financial/WCS Financial Services Inc
- Provie Assurance
- Groupe Cloutier Inc.
- Financial Horizons Group/Force Financiere Excel