Economical mutual policyholders vote to move forward with demutualization
Company takes next step towards creating a more competitive business
Waterloo - Mutual policyholders of Economical Insurance participated in an historic vote today, paving the way for Economical to become the first property and casualty insurer in Canada to demutualize.
At a special meeting in Kitchener, Ontario, mutual policyholders overwhelmingly voted in favour of commencing negotiations with non-mutual policyholders on the allocation of demutualization benefits through court-appointed policyholder committees, surpassing the required two-thirds majority (of those voting) required for a successful vote.
"We would like to thank our mutual policyholders for their support, today and during the past few years. The work ahead to demutualize the company is significant, but the opportunity to build for growth is equally important," said John Bowey, chair of the special committee on demutualization at Economical. "Our board and management teams are focused on taking the steps needed to enhance our competitiveness and improve access to capital. This is an exciting time for our company and we look forward to completing a successful process that will unlock our full potential."
The next step in the regulatory process will see Economical prepare and mail a formal notice to all eligible policyholders. The notice has to be approved by the Office of the Superintendent of Financial Institutions (OSFI), our federal regulator. After approval by OSFI and mailing of the notice, Economical will file an application with the court for an initial order setting out the procedure for the negotiations.
"We have built a strong business within our current structure and are pleased with our progress. Through demutualization, we will be able to drive growth in new and exciting ways," said Gerald Hooper, chair of the board of directors.
Economical encourages all stakeholders to stay informed on demutualization and to visit www.joininourfuture.com for updates. This website will be updated regularly and provides information about the latest news and access to demutualization-related resources.