Winnipeg-based insurer Canada Life and Mississauga, Ont.-based managing agent Primerica Canada have signed a distribution agreement that gives Primerica advisors access to a “curated” dedicated shelf of funds, the insurer said Friday.
Primerica serves many new Canadians and working-class Canadians and will expand the market reach of Canada Life’s existing distribution, David Stewart, senior vice president of independent distribution at Canada Life, said in an interview. “This will be an opportunity for us to really help the underserved mass market.”
Stewart said the product shelf includes a “core group of funds” with a variety of fund managers.
Training and onboarding of Primerica Canada advisors will take place in phases starting in 2025. Stewart said advisors must have adequate knowledge of segregated funds and where they fit in a financial plan to provide clients with the right advice.
Primerica has more than 10,000 licensed financial representatives, according to the company’s website. Canada Life says it has more than 16,000 advisory relationships.
“At Canada Life, there is no impact to existing distribution or advisors,” the insurer said in a statement.
Last year, Canada Life acquired wealth management firms Investment Planning Counsel (a subsidiary of Power Corp.) and Value Partners Group. The distribution agreement with Primerica will complement the insurer’s strategy to introduce more wealth management products through new sales channels, Stewart said.
In its second-quarter report to shareholders, Great-West Lifeco, the parent company of Canada Life, said individual wealth management sales in its segment in Canada were $4.6 billion, up from $2.4 billion a year earlier. The growth was primarily due to strong sales of segregated funds and mutual funds, both proprietary and third-party, as well as the addition of IPC and Value Partners.
Canada Life’s contractual service margin (CSM), or unrealized gains, in segregated funds was $1.90 billion as of June 30, a decline of $41 million from the prior quarter, attributable to “adverse experience.” in segment funds
Great-West Lifeco’s CSM in spin-off funds was $3.35 billion, down $76 million from the prior quarter. The decline was attributed to market inflows in Europe and net outflows in Canada.
“If you look at the overall segmented fund market, yes it has been challenged, but we are very optimistic that this represents a growth opportunity,” Stewart said.
The segregated funds represent more than one-third of Great-West Lifeco’s total assets under management in Canada.
