RSA-GCAN Deal “A Perfect Strategic Fit”: Saunders

$420 million deal makes RSA Canada's 4th largest general insurer.

A $420 million deal to acquire GCAN Insurance will extend RSA Canada’s reach in the commercial insurance market, making it the fourth largest insurer in Canada.

The general insurer will purchase the specialty commercial insurance company and its parent, Glenstone Capital, from the Ontario Teacher’s Pension Plan in an agreement RSA president and CEO Rowan Saunders calls “a perfect strategic fit.” The firms made a joint announcement October 4.

GCAN brings a range of small, mid-market and high-end commercial product lines–including excess liability, D&O and E&O offerings–to the table, giving RSA a broader product suite that ranges from small business to larger specialty risks, Saunders told Canadian Insurance Top Broker October 4.  “That suite will be unparalled,” he says.

Many of its offerings complement RSA’s market mix, such as its manufacturing and liability portfolios. Among other gains, Saunders estimates that adding its liability portfolio to RSA’s “will double RSA’s market share in an attractive and large segment.”

Broader broker network

It also folds GCAN’s 130 broker partners into RSA’s existing network of 800. Although there’s “significant” overlap in the two groups–Saunders says that 90% of GCAN brokers already have a contract with RSA–the deal will significantly increase the amount of business held with large regional and global brokers, he says.

GCAN’s services also represent an opportunity for RSA. Post-approval, the company will consider how the technological and service tools–including product-geared portals–and broker programs will fit into the merged companies. “We have to work with GCAN to understand tools and technology to figure out what to leverage,” Saunders says.

The same approach goes for broker programs, like GCAN’s Gold Broker program. After surveying offerings from both companies, “we’ll find the best of each and continue to leverage [those] in the broker marketplace,” he says.

He adds that RSA has already been in discussion with brokers about the deal. “They’re thrilled, we’ve had tremendous comments of support.”

The acquisition–which is still subject to regulatory approval–is expected to close in January 2011.

Copyright © 2017 Transcontinental Media G.P.
Transcontinental Media G.P.