Eligible mutual policyholders of Economical Insurance vote overwhelmingly to continue with demutualization

Posted on March 20, 2019

WATERLOO, ON, March 20, 2019 - Economical Insurance has achieved a significant milestone along its path to becoming a public company. At a special meeting held today, 99% of eligible mutual policyholders of the company that voted were in favour of proceeding with the demutualization process.

“We are the first Canadian property and casualty company to pursue demutualization under these regulations. It has been a long and complex journey, but we are gratified for the overwhelming support from our eligible mutual policyholders at this important moment in our history. Today we have moved a step closer to achieving our ambitious vision for Economical ” said John Bowey, Board Chair, Economical Insurance.

“The confidence shown in today’s outcome supports the transformation Economical has been pursuing to become a high-performing, independent Canadian insurer,” said Rowan Saunders, President and CEO, Economical Insurance. “We are building momentum across our business to unlock our full potential and become a leader in our industry, known for our business innovation and how well we take care of our customers.”

In January, Economical announced this second special meeting along with the details of its conversion plan. The plan outlines how Economical will convert from a mutual into a share company, including the method of allocating the financial benefits that will result from demutualization.

According to the federal regulations that govern the demutualization process, the next steps following today’s successful vote include:

  1. Seeking authorization from OSFI (the Office of the Superintendent of Financial Institutions) to hold a third special meeting of all eligible policyholders
  2. Host the third special meeting of approximately 630,000 eligible policyholders to vote on accepting the conversion plan
  3. Apply to the federal Minister of Finance for the final regulatory approval to demutualize

Following the successful completion of these remaining stages in the demutualization process, Economical Insurance would be in a position to complete its planned initial public offering (IPO).

“We are very much focused on realizing benefits from our strategic investments in the business and proving their potential through the IPO, so we can continue to be an innovative leader, a strong partner to our brokers and customers, and participate in industry consolidation,” Saunders explained. “The price of the shares sold in the IPO is ultimately what determines the value of the demutualization benefits distributed to eligible policyholders, and the proceeds from the IPO will also provide the funding for cash benefits distributed to eligible recipients.”

Economical will continually evaluate market conditions, company performance, and other relevant factors that may impact the timing and success of an IPO and, by extension, the remaining steps in the demutualization process.

About Economical Insurance

Economical is a leading property and casualty insurer in Canada, with approximately $2.5 billion in gross written premiums in 2018 and approximately $5.7 billion in assets as at December 31, 2018. Based in Waterloo and founded in 1871, Economical is a Canadian-owned and operated company that services the insurance needs of more than one million customers across the country.

For media inquiries please contact:

Sarah Stevens
Manager, Public and Media Relations
Economical Insurance
(T) 877.859.4950 ext. 54042
(C) 416.986.9360
sarah.stevens@economical.com

For stakeholder relations inquiries please contact:

Max Weis
Vice-President, Corporate Development
Economical Insurance
(T) 519-570-8291
max.weis@economical.com

For policyholder inquiries please contact:

Join in Our Future
(T) 1-866-302-6046 (toll-free)
joininourfuture@economical.com

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