Consolidator IDC Worldsource Inc. (IDC WIN) has acquired the individual life and health insurance and segregated fund assets of AFL Financial Group (AFL), a Quebec City-based MGA headed by Yan Charbonneau. IDC WIN is a Canada-wide MGA and a subsidiary of Guardian Capital Group Limited. Guardian announced the transaction on Oct. 4, 2021. The amount was not disclosed. 

Christian Laroche, President of IDC WIN's Quebec operations, will lead AFL business, backed by Lyne Lapointe, AFL's Executive Vice President, the IDC WIN said in its release, adding that the AFL team will be integrated into IDC. 

Assets of $750 million  

Through this transaction, IDC WIN is increasing its presence in Quebec. The consolidator already has a strong foothold in Toronto, Vancouver and Calgary. Its Quebec business was modest until it acquired Aurrea Signature from insurer Humania Assurance at the end of2019. One year later, IDC WINbought out Copoloff Insurance Agencies and other companies under the Copoloff brand.

IDC WIN President Phil Marsillo provided Insurance Portal with more details about the transaction. He declined to specify the premium volume in the insurance portfolio, which covers the individual life, critical illness and other health segments. Marsillo did mention that he acquired “about $750 million in assets under management, including $350 million in segregated fund products and the remainder in other savings products, such as investment certificates.”

Quebec City loses an MGA  

AFL's CEO Yan Charbonneau is moving on. In recent years, he has been focusing on his role of CEO of Synex Business Performance, a holding company that finances the acquisition of P&C and group insurance firms across Canada. Synex is not affected by the transaction. 

Charbonneau told Insurance Portal that he is still active in group insurance, operations that are separate from AFL. Charbonneau is poised to create an entity to consolidate group activities. “AFL Financial Group will cease to exist as an MGA,” he adds. 

IDC WIN chosen 

Charbonneau explains why he sold AFL Financial Group. “We want to focus on P&C and group insurance brokerage. The wave of consolidation among MGAs means that there are much fewer left to buy. With the size we were at, it was getting harder and harder to serve brokers well and to invest in compliance and technology. We had a choice: Buy or sell.” 

The Synex CEO says he chose IDC WIN. “They were the only MGA I approached.” He explains that he go to know Phil Marsillo when they both sat on the board of CAILBA (Canadian Association of Independent Life Brokerage Agencies). Yan Charbonneau is treasurer and Phil Marsillo is director of public relations. “I learned about [him as] an individual, and the individual often represents the values of the organization.” 

Some customers retained  

Synex pursues a consolidator strategy. The feature on Quebec's P&C insurance leaders that appeared in the September 2021 issue of Journal de l'assurance estimates Synex Insurance's P&C insurance premium volume at $200 million on June 30, 2021. Synex Performance's business volume in its group insurance practice rose to $50 million following an acquisition completed just before the sale of AFL.

Charbonneau mentions that he has retained some of AFL's individual life and health insurance business by acquiring books of business. These activities will continue to exist as a firm owned by Synex, designed to meet the needs of its P&C and group insurance clients. “We are still interested in buying financial security advisors’ books of business,” he points out. 

From the get-go, IDC Win had the Quebec City regionin his sights, a city in which AFL is well established. Phil Marsillo, president of IDC WIN, told Insurance Portal that he had been discussing a possible deal with Yan Charbonneau for a little over a year. Marsillo adds that IDC previously had a more modest presence in Quebec City, but a larger one on the island and South Shore of Montreal, and in Laval.

“Yan has built a great business and this helps us increase our presence, especially in Quebec City, in terms of staffing and advisor support. He also has a large P&C and group insurance practice. We have the same vision of things in insurance and we can continue with what he has built,” Marsillo explains.

AFL employees will remain in place, Marsillo continues, adding that the merged operations will be rebranded as IDC Worldsource. IDC operated in Quebec City under the Aurrea Signature brand until the transaction, he adds. 

Confident in Christian Laroche  

He says he is counting on the team and its leadership by Christian Laroche, “who knows the independent advisor network in Quebec well.” In the transaction release published by Guardian, Paul Brown, Chairman and CEO of IDC WIN, also praises the new team. “We are extremely enthusiastic to add to our growing IDC WIN family in Quebec, under the leadership of Christian Laroche,” he says. 

In addition to Lyne Lapointe, the other five AFL employees will join IDC WIN's operations, Laroche told Insurance Portal. “We are merging operations. Aurrea's lease ended in September and we decided to move to AFL's offices, which are more modern even though our offices were built five years ago,” Laroche says, adding that it would not have made sense to maintain two offices 1 km apart. 

Keeping the momentum going 

IDC WIN’s size will allow it to maximize the benefits of the acquisition, Laroche adds. “We already had a solid footing in individual insurance and segregated funds. We want to introduce our service offering to AFL advisors and see how we can help them. The transaction also allows us to seek out more back-officestaff,” he explains.

Laroche aims to demonstrate that IDC WIN is here to stay in Quebec. “We are a French-speaking company in Quebec, with a significant back-office,” he says. “The new administrative resources will be put to good use. With the integration of Aurrea Signature just completed, the MGA is now busily integrating Copoloff and its large block of business in force. “We have our work cut out for us,” says the president of IDC WIN's Quebec operations.

Christian Laroche adds that IDC WIN's sales were already vigorous before the transaction. “Individual life insurance has been growing 13 to 14 per cent annually for the last two years. Segregated funds are where it has exploded.” He mentions 50 per cent growth and says he has quadrupled the amount of new money coming into those funds.