SSQ moves from B2B to B2C

Group insurance giant is building its brand, selling more consumer-oriented products and tacking the Ontario market

Last year, after Richard Bell, SSQ Financial Group's CEO got his five-year business plan approved by the company's board of directors, he decided to personally tell company employees about it. All of them.

"We have 1,200, so it took a while," Bell said with a laugh. "We eventually had to meet with them in groups of 50. But it was worth it, because now we are all working towards the same goal."

Quebec City-based SSQ is the province's largest issuer of group insurance products. But the company has long had a low public profile. That's because most of its products are sold by brokers directly to businesses, who in turn offer life, disability, health, dental and other coverage as a fringe benefit to their employees.

But when Bell took over as CEO, he quickly realized that SSQ's low public profile was hurting it, especially in cases when its brokers would compete with better known Canadian players -like Sun Life, Manulife and Great-West Life -- who are trying to make inroads into the Quebec market.

"Buyers were giving our brokers funny looks when they were told how big we are. In some cases they'd never even heard of us,' Bell said.

As part of his multi-year business strategy, Bell decided to change all that. He launched a growth plan with two key elements, centered on selling more products directly to consumers and attacking the big Canadian players on their own turf by opening a Toronto office.

Revenues from non-group insurance sources,-- such as the firm's general, casualty and auto insurance lines -- accounted for only about 25 per cent of SSQ's premiums during 2003. Bell is convinced that directing a bigger chunk of the firm's $2 million ad budget toward consumers will boost that total and build SSQ's brand awareness. This will also make it easier for its brokers to sell the group insurance line.

SSQ was founded in 1944, but in its initial years the company faced tough growth challenges.

"It's very hard to move an insurance customer once he has signed with a competitor," Bell said. "So the company had to find another way to make money."

After the Second World War, Quebec businesses began increasingly offering their employees group insurance plans as a fringe benefit. At the time group insurance was a fairly new product and many customers hadn't yet developed brand loyalty. So SSQ jumped in with both feet and quickly built up a significant market share.

The company was initially owned by its policyholders, but in 1994, the Fonds de Solidarité FTQ took a 70 per cent stake. Ties between SSQ and its major shareholder were further cemented in 2001, when Bell's predecessor Pierre Genest, took the top job at the Fonds.

According to Bell, SSQ's strength comes in large part from its strong knowledge of the Quebec market.

"Look around you. All we have in this office is desks, phones and computers. But every company has that," Bell said. "If our people don't perform, neither does our business,"

Ask a big company CEO why the organization he heads performs so well, and he will almost always magnanimously rattle off talking points about how the real credit goes to the employees.

But when Bell says it, you get the impression he believes it. An actuary by trade, he comes off as a straight shooter, who talks with the precision of someone used to dealing with numbers.

To keep close to his employees, he answers his own phone as much as possible, and keeps an open door; which is not an easy task, because a lot of those 1,200 employees have used that door.

"It an employee has a problem and you don't deal with it right away, it festers and it ruins productivity," Bell said. "I can't always see everyone immediately, but I try to take care of most cases within three days.

According to René Hamel, SSQ's vice-president (group insurance), Bell's philosophy extends to customers as well as clients.

"We've had several discussions about how much money we could save by introducing more computerization into our telephone answering systems, but answer is always no," Hamel said. "(Bell) believes that when our customers want to file a claim, they want to talk to a person not a machine."

From the looks of it, Bell has been doing a pretty good job of achieving his goals. During 2003, premiums paid to the company jumped 10.9 per cent to $1.0 billion. And the company's Toronto office, which was opened just three years ago, is on track to book $100 million in revenues during 2004.

But despite Bell's success, it's impossible to shake his actuary's conservatism when it comes to future projections.

"We've been earning between 11 and 14 per cent on our capital each year," Bell said. "I'd be happy if we keep doing that."

Highlight this quote: "All we have in this office is desks, phones and computers. But every company has that. If our people don't perform, neither does our business." CEO Richard Bell.


Sidebar: Bell's management strategy

o Consolidate SSQ's Quebec group insurance base, and use the company's product knowledge to attack its Canadian competitors on their own turf.
o Build SSQ's public profile by branching out into non-core areas such as property, casualty and car insurance
o Build team spirit and employee morale by working with unionized employees, and by keeping call center jobs in Canada.
o Maintain an open door policy toward all of the firm's 1,200 employees.
o Focus on customer service by using live operators as much as possible and resisting temptation to overuse voice-mail.


Photo caption: According to Richard Bell, SSQ Financial Group's CEO, the company plans to continue to focus on its Quebec operations, while at the same time expanding slowly in the Ontario market.

Fact Box:
Company Name: SSQ Financial Group
Owner: Fonds de Solidarité FTQ 70%, policyholders 30%
Founded: 1944
Products: group, property and car insurance
Employees: 1,200
Sales: $ 1.0 billion
Phone #: 1-866-SSQ-Auto, 514-521-7365


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Peter Diekmeyer
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Montreal, Canada, H9S 1T6, 514-631-0025



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