Dutch banking and insurance giants have been busy not only in the United States, but also to the north.
On Dec. 31 the Canadian minister of finance gave final regulatory approval for Transamerica Life Insurance Company of Canada, the principal Canadian company of the Dutch insurer Aegon NV, to combine its operations with those of NN Life Insurance Co., ING Canadas life insurance arm, which it had bought in April.
Financial terms of the purchase were not revealed, but the two companies had operated separately while working on integrating systems and businesses in anticipation of regulatory approval.
When that approval came the Aegon unit shortened its name to Transamerica Life Canada.
Kenneth Stewart, its vice president of business development, said the combination is a good strategic fit, as it takes advantage of the best features of these two similar businesses. Both companies, he said, strived to offer innovative features in their universal life and segregated funds the Canadian term for variable insurance products.
The acquisition is also an opportunity for us to gain access to additional technology and their underlying support system, Mr. Stewart said.
The combined companys sales network now includes some 18,000 independent financial advisers, life insurance agents, and major broker-dealers throughout Canada, Mr. Stewart said.
However, sales through bank branches are not in the cards for Transamerica. Although Canadian banks are allowed to own insurance subsidiaries, federal law in Canada prohibits banks from selling life insurance in their branches.
Still, Mr. Stewart said, Transamerica Life Canada is looking to buy product manufacturers and to arrange more distribution alliances. He added that it is also putting together a suite of insurance products that will incorporate features developed by both companies, but declined to discuss them.
The merger is part of a two-year trend in Canada: an increasing convergence of insurance and investment sales.
Over 70% of licensed life insurance agents are also licensed to sell mutual funds, according to the Canadian Life and Health Insurance Association. And about 60% of full-service broker-dealers in Canada are licensed to sell life insurance, according to Investor Economics, a financial services consulting firm.
Broker-dealers sell mostly universal life and segregated funds, because the investment component fits into their business, said Jean Salvadore, a research analyst for the Toronto firm.