Policyholder Committee
Process

March 20, 2019 – As the negotiated allocation has been approved by both the committees and reviewed by the Office of the Superintendent of Financial Institutions (OSFI), the policyholder committees have been disbanded. There is no opportunity to reopen the negotiations. All eligible policyholders will vote on the conversion plan, which includes the allocation, at the third special meeting.

June 25, 2018 – Economical’s conversion plan, a detailed document that outlines how Economical intends to convert from a mutual company to a widely-held company with share capital, has been submitted to the Office of the Superintendent of Financial Institutions (OSFI). The conversion plan includes the agreed-upon method of allocating financial benefits resulting from demutualization, opinions from actuarial and financial experts, and the detailed legal particulars to effect demutualization.

The conversion plan will remain confidential as it is reviewed by our federal regulator.

February 8, 2018 — After months of complex negotiations, the committees representing eligible mutual policyholders and eligible non-mutual policyholders have reached an agreement in principle on the allocation of financial benefits that will result from the planned demutualization of Economical. The agreement remains subject to finalizing a formal resolution documenting the details of the agreement. Economical has been informed by the policyholder committees that they expect to pass the resolution soon.

Due to the complexity of the process, more time is required to complete the conversion proposal and the professional opinions that are required to be submitted to the Office of the Superintendent of Financial Institutions (OSFI), the principal regulator for Economical. OSFI has extended the deadline for submitting those documents from February 22, 2018 to June 30, 2018.

Details of the conversion proposal, including the allocation of financial benefits, remain confidential. They will be made public at a later date in policyholder information circulars that will be sent to eligible policyholders and made available on joininourfuture.com.

August 11, 2017 - Since their appointment in February, the policyholder committees have begun the process to negotiate the allocation of benefits resulting from a demutualization of Economical. As Economical is the first insurance company proceeding to demutualize under new federal regulations, these negotiations are breaking new ground. The committees, along with their appointed counsel and advisors, have been working diligently to understand the complex issues that affect the allocation of financial benefits that would result from a demutualization of a 146-year-old company.

Economical has been actively providing information to all parties so that the committees can negotiate from an informed position. Each policyholder committee has hired financial advisors and actuarial consultants who, along with appointed counsel, will assist in the negotiations and work to promote a demutualization process that is efficient, effective, and reaches completion. They have also received information from the appointed actuary and independent actuary, who are required to assess the allocation the committees negotiate and provide fairness opinions.

The policyholder committees must reach an agreement on allocation, and the appointed and independent actuaries must provide their opinions on that allocation, before Economical can submit its conversion plan to OSFI. The conversion plan must be submitted by February 22, 2018*.

The details and substance of negotiations will remain confidential pursuant to court order.

*In January 2018, OSFI extend this deadline to June 30, 2018.