What BrokerLink and Ontario mutuals are saying after contracts terminated

Public conversations are emerging in the Canadian property and casualty insurance space after BrokerLink recently cancelled contracts with some Ontario mutual insurance companies.

The Commonwell Mutual Insurance Group, which wrote $304.8 million in total insurance revenue in 2024, confirmed it is one of the terminated mutuals. Sources tell Canadian Underwriter the contract with BrokerLink was worth between $25 million and $40 million in business. The Commonwell president and CEO Tim Shauf told CU this is a “reasonable” estimate.

It’s unclear how many other Ontario mutuals were affected. Sources tell CU the numbers range from a “few,” to “multiple,” to “a handful,” to as many as nine.

BrokerLink confirmed mutuals were among a number of markets with which it ended contracts, but it declined to specify the number and affected mutuals, both for competitive and client confidentiality reasons. Nevertheless, the brokerage tells CU it still has “double digits” of mutual partners going forward, and holds one of the largest mutual portfolios in Canada in the “high hundreds of millions.”

One source in the mutuals community confirms there are still at least three Ontario farm mutuals with “good volume” with BrokerLink.

For The Commonwell, the company and its legacy organizations have served members for 130 years and is “not going anywhere,” Shauf says. “We’re well within our capacity to manage this transition and we have many long-time broker partners that we are looking forward to continuing to grow with and work closer with them.”

Not mutual-specific

The public conversation swirls around the rationale for the cancellations. Some suggest smaller Ontario mutuals were collateral damage in BrokerLink’s move, while the brokerage says these changes were misinterpreted to be specific to Ontario mutuals.

BrokerLink will “still be working with mutuals because the whole premise of [this public conversation is that] we’re kind of abandoning Ontario mutuals…That’s just not the case,” BrokerLink president Joe D’Annunzio tells CU.

“What I can say is after careful review, we’ve made some changes this year…to part ways with a small number of markets,” he says. “But those markets aren’t just mutuals…I don’t distinguish whether it’s an MGA, a mutual, a private or a public stock.

“We did do a parting of the ways with a few [markets],” he says. “To be clear, mutuals remain an important part of our value proposition. They continue to play a key role going forward in us delivering choice and competitive solutions to our customers.

“We don’t expect the overall concentration going forward after these changes we’ve just made to be material significantly in how much mutual business we have.”

D’Annunzio confirms it completed a thorough review of its markets, something it does every three to five years.

“We looked at who’s growing, who’s shrinking, who’s profitable, who’s introducing new technology to make it a great experience for our brokers, who’s using great technology to make it a great customer experience,” D’Annunzio says. “And then these are all things that go into deciding, ‘Do we need this [market]? Should we go get a new one?’ And then our employees tell us…

“And I want to be absolutely clear — we place each customer with the market that matches best for them based on several factors, including pricing, product, unique coverages, and where the customer is most comfortable…”

One source tells CU that besides The Commonwell, nine other Ontario mutuals were affected, for a total of tens of millions in gross written premiums. Rumours suggested BrokerLink was moving the business to Intact instead.

“This is not accurate; categorically, no,” D’Annunzio says of the public conjecture. “There’s innuendos and rumours — now that always happens [with a cancellation]. We tend to ignore it and just run the business…

“We already have a lot of volatility in the marketplace. We don’t need false narratives going round and round.”

Aviva relationship

As one of Canada’s largest brokerages, BrokerLink has contracts with more than 60 personal lines carriers and more than 90 commercial lines carriers. It also added three or four markets in the past two years. Effective Nov. 1, it will be adding Aviva Canada, the country’s second-largest P&C insurance company, for personal lines.

“It’s taken months to build that relationship,” D’Annunzio says. “We’re proud to say that we’re going to be an Aviva personal lines broker effective Nov. 1.”

What kind of impact will the cancellations have on Ontario mutuals?

“This type of cancellation or transfer is disappointing to the mutuals affected,” says John Taylor, president and CEO of the Ontario Mutual Insurance Association (OMIA).

“Mutuals have long-term policyholders, and those policyholders have been there for the mutuals through the highs and the lows,” Taylor says. “Equally importantly, the mutuals have been there for these policyholders, in good years and bad, through catastrophes and fires, and accidents to pick up the pieces…”

Mutuals have deep, local expertise in loss prevention and claims in their communities, and this expertise is especially important in rural areas across the province, he adds. “From an impact standpoint, the main concern is the potential loss of those long-term policyholder relationships.”

Thirty-three mutuals across Ontario write just under $1.5 billion in premium, Taylor says.

“From a business side, this is a setback, but mutuals are resilient. We have a huge presence in our communities, and that is not going to change.”