Economical’s Plans for Demutualization and your Insurance Policy
Economical Notifying Eligible Policy Holders
In April and May 2016, Economical Insurance is sending out letters to all eligible policyholders notifying them that they are able to participate in the demutualization process.
These letters will also give the eligible policyholder login information to access a demutualization self-serve portal (coming in late April) on Economical’s demutualization website.
If you receive a letter, we encourage you to log in and set up an account on the self-serve portal. If you have any questions or concerns, please visit Economical’s demutualization website – joininourfuture.com.
About Economical’s Demutualization Process
As your broker, Archway Insurance works with you to select the insurance company with the best combination of protection and price to meet your insurance needs. We believe in providing choice to our clients, and that sometimes means switching your insurance provider. If your insurance is currently placed with Economical Insurance, we want to make sure that you’re aware of the impact planned changes may have on you.
On November 3, 2015, Economical Insurance announced that its board of directors formally decided to proceed with demutualization, launching the process to convert the company from a mutual to a stock company with shareholders. As a result, Economical has asked its brokers to share its plans with current policy holders.
It is our understanding that as part of the move away from mutual policy holders to common shares, eligible policy holders may receive a financial benefit in the form of cash or shares. For this reason, you may be interested in maintaining the Economical policies you already have.
The demutualization framework, including eligibility, is set out in regulations enacted by the federal government. Under the regulations, an eligible policyholder must, at a minimum, have held a policy on November 3, 2015, the date of the board decision (non-mutual policyholders would also had to have done so for the 12-month period ending on that date). However, an eligible policyholder might lose their eligibility if their policy is cancelled or lapses after the board decision date.
The demutualization process is complex and requires many steps to complete. Economical estimates that, from November 3, 2015 to the date the Minister of Finance approves the conversion, the process will take at least 24 months, assuming all steps are successful.
As an Economical Insurance broker, Archway Insurance does not have access to inside information. If you are interested in learning more,we recommend that you contact Economical directly: