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Canada&#39s new life

Canada Life&#39s third-quarter results provide evidence that our approach to the IFA market is working. Previously perceived as mainly a direct-sales operation, over three-quarters of our new business premiums now comes from the ind ependent sector.

Canada Life&#39s initial strategy for the IFA sector was to take things one step at a time. We recognised that, as an established and well resp ec ted direct-sales operation, IFAs would naturally be cautious of our motives for entering their market and the level of ongoing support and service they could expect.

We decided to specialise in particular areas, first dipping our toe into the independent market some 20 years ago when we launched our group life policy. It took over a year to receive our first application but we persevered to become today one of the top five offices in this market.

Concentrating on this area allowed us to establish relationships with many of the bigger employee benefit consultancies and national IFAs which we developed with our subsequent moves into the group PHI and compulsory annuity markets.

Then, in the early 1990s, and on the back of our success in the group market, we decided to move into individual protection, initially via term insurance, closely followed by PHI and critical-illness cover.

We developed not only a reputation as a major player in the protection market but also credibility as an IFA company, the lack of which has been a major contributory factor in the failure of a number of other direct-sales offices&#39 attempts to enter the IFA market.

However, our success was largely down to rate-driven products. To meet the company&#39s bold growth plans req uired us to drive up our IFA business even further by entering the very competitive world of investments and pensions.

The acquisition of the Met Life (UK) Group in November 1997, which included Albany Life and Albany Life Inter national, gave us the opportunity to build on the investment side of the business.

However, following Can ada Life&#39s demutualisation a year ago, we realised that to take our business to the next level, our strategic planning needed to take account of the short-term challenges presented by the introduction of stake holder pensions and the longer-term business opportunities lying ahead in 2002 and beyond.

Critically, we also needed to understand fully the changing dynamics of IFA distribution and adopt smarter work practices in developing business relationships to meet customers&#39 requirements.

Canada Life has already seen a dramatic, positive change in the development of its key lines of business. We have identified niche markets and “enhanced customer value” concepts to enable us to compete strongly in the wealth management and retirement income planning businesses.

In the past two years, key wealth management products were delivered to the market primarily through Canada Life&#39s offshore operation based in the Isle of Man, which was able to quadruple its business over the period.

My appointment as executive director IFA distribution for Canada Life UK, in addition to my existing res pon sibilities in the Isle of Man, reflects the desire to transform the app roach to the UK business as well.

The company launched itself into the flexible life plan market in 1998 and in July 2000 launched a flexible wealth-creation savings product geared for high-net-worth UK residents.

We also pioneered an alternative approach to the retirement income planning market with the launch of the annuity growth account, combining income flexibility with longer-term investment growth.

We believe our IFA proposition and new breed products will be copied by competitors but we see this as inevitable in a market where innovation, new product development and flexibility are necessary to keep at the front of the pack.

In trying to crack the IFA market we feel we have adop ted a strategy that responds to the needs of IFAs looking to conduct their business with a decreasing number of IFA-focused providers. The IFAs and their customers have increasingly sophisticated needs and expectations.

They demand things faster and better. They are better informed through increased availability of internet access – and demand flexible products at low cost. These developments have already changed the role of the broker consultant, especially those who fail to add value for the IFA or the company for which they work.

Technology underpins the delivery of investment products as IFAs increasingly exp ect to be able to submit applications online, get immediate underwriting decisions, and settle transactions rapidly.

However, the story does not end there. Provision of online client support, value-enhancing marketing ideas and other market information allows Canada Life to str engthen its relationship with IFAs and, in turn, enable the IFA to manage and service his client base efficiently and effectively.

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