Financial Well-Being and Economic Prosperity
Financial services, the mainstay of our business, make a positive contribution to society by providing financial security to virtually millions of people. Our group companies protect and improve the long-term financial position of individuals and offer programs to help them manage their healthcare needs. By the very nature of our group companies, our activities are aligned with the Sustainable Development Goals and create social and economic prosperity.
With more than 31 million customer relationships globally, our financial services companies represent a positive force in society by enabling financial security through life and health insurance, retirement savings programs, and a suite of investment products.
A 2016 report released by the Center for Interuniversity Research and Analysis of Organizations (CIRANO), The Gamma Factor and the Value of Financial Advice, found that investors who work with a financial advisor have a higher savings rate on average than those who do not. For example, over a 15-year period, households working with an advisor had 3.9 times the assets of a household without a financial advisor. The study highlights the value advisors add by encouraging more disciplined saving and investment behaviour.
Having the knowledge, skills and confidence to make informed financial decisions is critical to the financial well-being of our clients. Through the innovative products and services provided by our operating subsidiaries Great-West Lifeco and IGM Financial, and by the fintech companies in which we invest, such as Wealthsimple, we are helping clients of all backgrounds plan for their long-term financial security and success.
Highlights from our Group Companies
Financial Security and Retirement
In 2020, Great-West Lifeco paid over $39 billion in benefits to customers globally, including $9.3 billion in Canada. Great-West Lifeco’s Canadian insurance companies helped families cope with loss, paying out more than $2.6 billion in life insurance benefits in 2020 and providing income for over 82,000 people who became disabled and could no longer work. Their participating life insurance products delivered over $1 billion of policyholder dividends. They also helped approximately 27,000 employers provide benefits plans and more than 9,000 employers offer retirement savings plans to their employees. In addition, they made $912 million of annuity payments, helping Canadians fund their retirement with a secure income stream.
As investment managers, IGM Financial’s group companies contribute to the economy through the efficient allocation and professional management of investment funds – across countries, industries and asset classes. Their largest impact comes from responsibly managing their business and generating long-term value and profitability, which enables them to distribute economic value to their many shareholders and other stakeholders in Canada. Through its advisors, IGM Financial helps Canadians build an integrated financial plan to meet their short- and long-term goals. Financial advisors are trained to recommend products that are suitable for each client’s individual situation. They continue to evolve their products, services, support, and training so that their advisors can continue to enhance the financial well-being of their clients.
As a wealth and asset management company, IGM Financial believes that one of the best ways we can contribute to Canadian society is by offering our resources and expertise to help Canadians feel confident about their finances. This way, they can achieve their goals, own their financial future and optimize their financial well-being.
IG Empower your Tomorrow focuses on assisting four key groups who are underserved when it comes to financial guidance: Indigenous peoples, newcomers, seniors and youth. This platform is brought to life through IG Wealth Management advisors, national partnerships, community seminars, events and educational materials. In 2020, the company launched the IG Empower Your Tomorrow Indigenous Commitment, which dedicates $5 million over the next five years to support programs and initiatives to further the financial confidence of Indigenous communities in Canada. Also, knowing that learning the financial systems of a new country can be daunting, IGM Financial works with the Immigrant and Refugee Community Organization of Manitoba (IRCOM) to provide financial education in newcomers’ first language. As another example, the IG National Service Centre (NSC), established in 2018, is a centralized service for providing account support and financial planning to IG client households with smaller accounts, enabling to offer a targeted, consistent and real-time experience. The NSC’s licensed financial representatives leverage technology to help clients manage their plans and investment accounts, and they assist with mortgage, banking and insurance needs. As their needs evolve, clients have access to advisors who focus on more complicated and sophisticated financial planning. Finally, IG research has shown that 60 per cent of women aged 45 to 54 have no financial plan, IG is trying to change the situation through its financial seminars for women covering five key topics that matter to women: wealth creation, retirement optimization, estate planning, business success and charitable giving. More than 50 seminars were held in 2020.
During COVID-19, Canada Life provided options and flexibility for customers experiencing financial hardship as a result of COVID-19. For instance, customers were able to defer their premium payments for up to 90 days without interest, or, for term, some universal life insurance and some critical illness insurance policies. They were able to reduce their coverage by up to 50 per cent – with lower premiums – and request to return to original coverage and premium amounts without underwriting within 90 days. The company also adjusted its practices, including how to handle term renewals, extending the deadline for group conversions from one to two months. In addition, it temporarily adjusted its threshold for accelerated life, and non-registered non-spousal wealth claims, enabling it to pay more claims faster with minimal requirements. Early in the pandemic, Canada Life announced mortgage support measures for those directly affected by the pandemic.
Canada Life also introduced the Financial Solutions Centre (FSC) – an alternative service model designed for smaller wealth accounts. The FSC helps advisors and clients grow so advisors can focus on growing their business and improving their productivity, while clients can receive a consistent experience and tailored advice to help meet their financial needs.
Our group companies’ commitment to improving financial literacy also represents a means to further expand their positive impact on the financial security of their clients.
Canada Life is the national development sponsor of the Chartered Professional Accountants of Canada (CPA Canada)’s award-winning financial literacy program, which draws upon the knowledge and expertise of more than 7,000 passionate CPA volunteers to deliver objective and free sessions that help Canadians, from children to seniors, make informed decisions and achieve their goals. Since becoming the Financial Literacy Program National Development Sponsor in 2014, the company has provided over $1 million in support, which has helped CPA Canada build a strong volunteer network with in-person workshops and digital training and resources. In 2020, to address needs created by the COVID-19 pandemic, Canada Life supported Wellness in a Time of Crisis & The Road Ahead, a new program to help Canadian workers survive the immediate challenges of COVID-19 and adapt to changing circumstances. The program provided straightforward information, distilled jargon and helped Canadians formulate a plan to move forward. The series also featured resources from Workplace Strategies for Mental Health to provide Canadians with practical hands-on tips on managing their well-being. More than 102,000 people attended or downloaded resources from the series. Overall, in 2020, over 750 sessions were held with more than 183,000 Canadians attending workshops and more than 162,000 people accessing digital resources.
IG Wealth Management’s ongoing collaboration with the Canadian Foundation for Economic Education (CFEE) continued to make a real contribution in 2020 to improving financial literacy of youth and their parents. IG Empower Your Tomorrow workshops were delivered in a new virtual format in 2020. The first virtual workshop, a Money and Youth workshop aimed at IG clients and their high school/college/recently graduated children, attracted more than 260 households. Topics included planning for the future, saving and reaching financial goals. All told, more than 1,600 households participated in CFEE/IG financial literacy workshops in 2020, up from less than 1,100 in 2019.
Investments to Spur Growth
Through its investment activities, Great-West Lifeco provides long-term capital, contributing to economic growth, and helping Canadians reach their financial goals. The company’s commercial mortgages, public bond and private placement investments provide opportunities for businesses and governments to help create employment, fund research and development, and support infrastructure, healthcare and renewable energy projects. In 2020, the company funded more than $2.6 billion in new private debt and commercial mortgages across Canada.
Canada Life is also a founding investor of the Canadian Business Growth Fund aimed at fostering innovation. Funded by Canada’s leading banks and insurance companies, the Fund will invest in Canadian entrepreneurs and provide businesses with the capital they need to grow domestically and globally. An advisory network has also been created to provide mentorship to help these businesses to achieve their full growth potential and write the next generation of Canadian business success stories.