Although it may appear the channel is becoming concentrated in fewer hands, says Cooke, the numbers argue otherwise.
“Part of the story that isn’t told, I think, means that it (the channel) isn’t more concentrated than it is,” says Cooke, “because competitors on the life-side and the banking-side remain quite, quite ‘un-concentrated,’ if you will.”
He points to Intact’s market share sitting in the 11 or 12 per cent range, but the next closest competitors (Aviva, and now Desjardins) holding only a 5, 6 or 7 per cent market share.
“It is reasonably un-concentrated, and part of the reason is ownership,” says Cooke. “The fact that there is no easy way to de-neutralize; so now you are seeing State Farm, assuming it is an asset sale, being taken over. It is not a new way of doing it, but it is the first major way that that’s been done in the P&C business with a neutral for some time.”
Major takeover rocks Canadian market
Threat to advisors or wakeup call?