The Benefits Alliance Group- In the News Again

The Benefits Alliance Group LogoOnce again, our “Taking It To The Next Level” Benefits Alliance Group AGM/Conference got tremendous coverage in the Benefits and Pensions Monitor’s News Alerts.  The  Monitor’s News Alerts is read by thousands of industry subscribers each weekday morning.  The Benefits Alliance Group is getting terrific industry exposure from these postings.  Happy Reading!


Election Risk To Economy

One of biggest risk factors facing financial markets these days is the U.S. presidential election, says Clément Gignac, senior vice-president, chief economist, and chair of the asset allocation committee at Industrial Alliance Insurance and Financial Services. He told the Benefits Alliance Group’s ‘Taking It To The Next Level’ session on ‘The Economy and Capital Markets’ that while the polls suggest Hillary Clinton will win, it is not time to be complacent as a lot of things will happen over the next six months. He is optimistic that Donald Trump will not be elected, but a Clinton win could be less friendly to Wall Street and more friendly for Main Street. This, he said, could be an issue. He called the current risk of a U.S. recession “close to non-existent.” Despite sentiment to the contrary, all the indicators such as labour markets, housing starts, and inflation trends are in expansionary territory with no indication of a recession any time soon. While the recovery has been more modest than in the past, this is due in part to lower productivity which could be a result of an older population. An older population means lower productivity, he said.

CDIPC Helps Smooth Drug Costs

The Canadian Drug Insurance Pooling Corporation (CDIPC) is not a vehicle to grow the number of plans coming to market or a means to neutralize drug cost growth, says Dan Berty, its executive director. Speaking at the Benefits Alliance Group’s ‘Taking It To The Next Level’ session ‘Drug Insurance Pooling for Fully Insured plans: Reality, Myths, and Brass Tacks,’ he said it is part of a two-tiered approach to help manage high costs drugs. It steps in after EP3, the first step beyond an employer’s benefit plan. EP3 covers the cost of one time drugs over $10,000. CDIPC comes into play for recurring high cost drug claims of more than $32,000. CDIPC insures the impact of catastrophic drugs claims and is a means to improve the degree of predictability of the impact risk from recurring catastrophic drug claims. With EP3, it smooths out the cost of high cost drugs. However, given the cost of expensive and new drugs, pooling charges will continue to grow at a rate exceeding inflation, he said.

IPP Best Practices Not Always Followed

The penetration for Individual Pension Plans (IPPs) is poorer because people have not followed best practices, says Stephen Cheng, managing director and senior consulting actuary at Westcoast Actuaries. In a discussion with Jean-Pierre Laporte, chief executive officer of INTEGRIS Pension Management, at the Benefits Alliance Group’s ‘Taking It To The Next Level’ discussion ‘Meeting of the Minds: IPP & PPP,’ he said that in the past people were getting into problems with IPPs because they were, for example, setting up shell corporations. However, the Canada Revenue Agency was against these and it resulted in law suits and legal actions. However, IPPs can do many of the same things Personal Pension Plans (PPPs) do without unnecessary administrative costs. The PPP is an IPP with a defined contribution provision, but the former has added administrative complexity. Laporte noted that the IPP has experienced anemic growth for several reasons. These include a lack of a co-ordinated industry strategy to convert RRSPs to IPPs and limited appetite for them by large distribution channels. As well, they seem inflexible in the sense that as an entrepreneur has with ups and downs in cash flow, the costs for IPPs continue to go up as they get older. Currently, there are about 15,000 IPPs although the potential market is over one million. By 2020, Laporte expects PPPs sales to replace IPPs.

Engagement Now Top Priority

Employee engagement has become a top priority for all company, says Jon Harris, president and COO at Lifeworks. Speaking at the Benefits Alliance Group’s ‘Taking It To The Next Level’ session ‘Changing The Face Of Employee Engagement Through Social Recognition,’ he said innovative providers are helping organizations created engaged communities which build relationships and encourage positive behavior. They are doing this using new technology which is transforming engagement from an isolated activity to a critical component of corporate strategy. The numbers indicate the importance of engagement. He said seven out of 10 employees are disengaged and unless employers can keep them engaged, they will lose top talent because they can go anywhere these days. However, engagement begins with understanding, but only 32 per cent of organizations have a strategy. Strategies for engagement and well-being in the workplace start with enabling employees to recognize each other for the values they bring to the organization.