Daryl Angier
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Renewing The Guarantee | Canadian Insurance

Renewing The Guarantee

To keep the 140-year tradition of success going at The Guarantee Company of North America, brokers say new CEO Alister Campbell will have to raise the company's profile while shaking up its product offerings

Alister Campbell likes to joke that in his time at Zurich, he held seven jobs in 10 years but had only one parking spot. In his first stint at Zurich, Campbell rose quickly from a sales and marketing role to president of personal insurance. When that division was sold to ING, Campbell ultimately went too, and his upward trajectory continued. A couple of years later, when the chance came along to go back and run the entire Zurich business in Canada, Campbell seized it.

Campbell proved his worth as CEO, hanging on to market share through the financial crisis of 2008, and maintaining Zurich’s position as a top-10 writer for commercial property and liability. Campbell is also widely liked and respected throughout the industry. Brokers praise him for his intelligence and energy and his understanding of the issues they face today. He has also been an outstanding industry ambassador. He speaks at conferences regularly, always employing an engaging wit with a honed sense of timing and drama to make his points effectively and memorably.

Thus, when word came down this past February that Zurich and Campbell had parted ways, it came as a surprise to many. For any company in need of new senior management, however, Campbell’s sudden availability represented a unique opportunity. It was as if Sidney Crosby had suddenly hit the free agency market.

The firm that ultimately won the lottery for Campbell was The Guarantee Company of North America (GCNA, or “The Guarantee,” as it is widely known). Coming from a publicly-traded global insurer with offices around the world, Campbell is now running a Canadian-based, privately held company known for its specialties. To be successful, Campbell will need to rely on his solid understanding of the independent broker channel and the strength of the relationships he has built to win the fight for market share through a patient, long-term strategy.

“I feel like I’m inheriting a duty as the guardian of the brand to honour that history and respect it and keep it going. There are very few institutions with a legacy like The Guarantee.”

“One of the greatest challenges for the global multinationals as well as the publicly traded domestics is that it just gets harder and harder for a CEO to think longer-term and to act strategically,” he explains. “Having a longer term view and being able to manage with that longer-term view is a key part of why I chose The Guarantee option.”

Broker Background

Campbell comes from an academic background and could fit easily into ad campaigns that explode the myth that a liberal arts education has no value in the business world. The son of two professor parents, he earned a masters degree in medieval English economic history before falling into the insurance industry.

In the ’80s, Campbell was a sales rep for the Trivest Insurance Network, a broker consolidator company owned by the Bronfman family. Trivest bought minority stakes in brokerages across the country and provided them with consulting to help improve margins and grow organically, as well as capital for acquisitions and perpetuation. Trivest lasted eight years but a number of the brokerages it was involved with are still (or have become) leading firms today. Principals who got to know Campbell through Trivest speak highly of his intelligence and his insights into the broker channel.

“He was always very friendly and helpful and always had great ideas,” says Marshall Sadd, president of Edmonton-based Lloyd Sadd, a one-time member of the Trivest Network. “I enjoyed picking his brain on industry trends and topics. He always was on top of those issues and had a very enlightening perspective on broker distribution. … He was full of energy for brokers and helping brokers grow their businesses organically.”

On Campbell’s time at Zurich, Sadd says “he was always willing to fly out to Edmonton and meet with a client. I remember him hand-delivering a cheque to a client in Medicine Hat. His manufacturing plant burned to the ground and it was an over-$20-million loss. Alister personally delivered a cheque to the owner and it was done within 60 days. It was the quickest turnaround and closing of a claim that I’ve ever experienced, especially of that magnitude.”

Succession at The Guarantee

Campbell came onto the market at a pivotal moment for The Guarantee. CEO since 1994 Jules Quennville was retiring, and president and COO Bob Dempsey had announced his plans to retire by the end of 2013. Campbell says the very first call he received after leaving Zurich was for the CEO position he now holds. He received several other calls in the coming weeks, three of which became serious job offers. He even considered becoming a broker, as well as taking a public policy position. The latter would not have surprised many people, given Campbell’s well-known involvement in Conservative party circles.

In the end, the opportunity to lead a firm with a rich history like The Guarantee—the company is celebrating its 140th anniversary this year—proved the most enticing offer.

“I feel like I’m inheriting a duty as the guardian of the brand to honour that history and respect it and keep it going. There are very few institutions with a legacy like The Guarantee. … This company is a market leader in a set of niches where lots has changed over 140 years.”

The Guarantee is unique in the Canadian insurance landscape. First, it’s one of only a few Canadian-based companies with operations in the US (it’s the 24th largest writer of surety in the US, up from 26th last year). More significantly, The Guarantee is a specialist underwriter with a unique suite of products that don’t obviously dovetail with one another. The company is a market leader in the areas of surety and fidelity (see sidebar: Faith and Certainty). However, it also writes a lot of high-value home-owner insurance, particularly in Quebec where it is known as La Garantie. According to brokers that spoke to Canadian Insurance Top Broker, the odd product mix has created a lack of clarity around the brand.

“They’re sort of an outlier in that they do high-end personal lines and then they do D&O and a bunch of specialties that don’t necessarily fit together,” says Greg Belton, chairman of HKMB Hub International and a longtime associate of Campbell. Belton believes it will be important for Campbell to increase GCNA’s profile and “make its appetite a little bit clearer.

“I always use the example of Chubb that has a very clear brand. It’s pretty clear in people’s minds what their strengths and limitations are. With GCNA I don’t think that’s crystal clear to most people.”

Sadd echoes Belton’s comments. “I think of GCNA as this little Canadian well-kept secret that has great people, lots of potential but has always been very sleepy,” says Sadd. “They’ve been good at the surety world, but outside of surety we don’t think of them for anything else.”

Both Belton and Sadd believe Campbell is an ideal choice as CEO to address these issues. “It just lends itself to a communicator like Alister raising the profile of the company and bringing a strong marketing focus,” says Belton. Sadd agrees. “We’re very excited to have Alister leading that company. I think it’s going to look very different in the next three-to-five years.”


Growing the company in a targeted fashion is a key part of Campbell’s mandate. The Guarantee has been a specialty writer for decades and Maureen Cowan, chairman and CEO of Princeton Holdings which owns The Guarantee, believes that is where it should stay.

“In a world of big getting bigger, I think that there is a real opportunity for the good specialist writer,” she says. “We have an objective to expand the company’s capacity, particularly with specialized markets, because that’s where I know we’re good. We want to not only enhance our existing specialties but also add some more that will diversify the company’s portfolio a little bit; but sticking to our specialty nature.”

A major part of the reason that Campbell got the job was because of his expertise with specialty products and specialty brokers. “He has the knowledge of what different brokers look for. Commercial brokers doing very specialized business look for something different than, say, a smaller broker might look for that’s dealing with a lot of individual insurance clients with very diverse needs. He would know a lot of those brokers and has a high respect for [them],” says Cowan.

What these brokers are looking for, claims Campbell, is an alternative to what he likes to call “machine underwriting.”

“I’m looking for the entrepreneur brokers, and I’m looking for ones who are in it for a long time and that will protect me from the risk of a key broker partner being absorbed into one of the machine underwriters.”

“The big scale machines have their attributes. But nimble, targeted, expertise-based underwriters, I think, with local decision making, can win in specialized areas where customer focus matters the most,” he says.

Take surety, for example. The surety space is being re-shaped by changes in the world of construction contracting—which accounts for roughly 60% of the surety market. Campbell acknowledges that in today’s world of P3s and larger, more complex construction projects, more business is being won by large general contractors.

That point was made clear during a panel discussion (moderated by Bob Dempsey) on construction procurement at the National Insurance Conference of Canada (NICC) in Quebec City this October. During the discussion, Geoff Smith, the colourful CEO of general contractor EllisDon, noted that clients are increasingly asking for “one throat to choke.” That is, a single entity that does everything, from designing the building, to construction, and perhaps most significantly, operating and managing the asset over the course of its lifespan. This in turn has left general contractors shouldering more of the risk, said Smith. “Our role has broadened very dramatically. The architects and consultants; we used to work for them, now they work for us.”

Campbell is well aware of these changes and what his new employer must do to adapt. “Those large contractors have been purchasing products from people who have innovated in this space, and we have not been as innovative as we need to be in terms of new products to meet these changing customer demands,” he admits. In fact, much of the innovation in this space has been driven by Campbell’s former employer with its Subguard (subcontractor default insurance) product. At the 2010 RIMS Canada conference in Edmonton, this writer attended a session where representatives from The Gurantee and Zurich explained and defended the differences between traditional surety bonds and Subguard. The session was memorable for how heated the discussion became.

“My view would be that the surety industry has hoped for 15 years that this product would fail,” says Campbell. “It has not failed. It has met a customer need and the surety industry needs to evolve in response.” Sadd agrees. “Contract default insurance is not going away …. Surety bonds and contract default insurance can work in parallel. [Campbell] can bring that to the Canadian marketplace.”

Broker Force

In bringing new and improved products to market, Campbell will be choosing his distribution partners very carefully. Along with many other CEOs of broker-based insurers, Campbell has observed with concern the trend of some insurers successfully using leverage in the broker channel—through equity investments and financing—to secure increasing percentages of personal lines and small-business premium.

“Several of those insurers are now major players in middle-market commercial and specialty. And so they have the potential to, and will eventually decide to, try and employ that leverage to target exactly the lines of business we’re in,” he says.

“Putting aside the public policy issues about this, I think it is a practical challenge for a company like us to be thinking very deliberately about who our distribution partners are in these specialty, niche areas where we’re going to focus our efforts. I think the flip side is equally true, which is that the brokers are going to have to be more deliberate and strategic about who their long-term insurer partners are.”

Campbell’s message is blunt. “I’m looking for the entrepreneur brokers, and I’m looking for ones who are in it for a long time and that will protect me from the risk of a key broker partner being absorbed into one of the machine underwriters that has as a strategy around exercising distribution leverage.”

On the whole, however, brokers seem excited about Campbell’s new role. “I sent him a letter saying this is fantastic that you’re working for a Canadian company where all the decisions are made here,” says Belton. “I’m sure that’s a big reason why he chose GCNA over some of the other opportunities.”

Jacques Dufresne, eastern region executive vice president of BFL Canada, also sees good things.

“There’s been a number of mergers and acquisitions over the last while in Canada. There aren’t that many Canadian insurers left that underwrite commercial lines in a more general sort of way. So I think to have GCNA expand in terms of what they are going to write is going to add choices to the broker force. To me it’s positive.”


Faith and Certainty

The Guarantee Company of North America is a top-5 writer of both surety and fidelity in Canada, competing toe-to-toe with much larger players

Surety Guarantee Insurance Written in 2011
Rank Company/Group Direct Premiums Written$,000 Earned Claims Ratio%
1 Travelers Guar Co of Canada 86,240 5.93
2 The Guar Co of N America 72,311 16.39
3 Aviva Insurance Co 56,736 22.39
4 Jevco Insurance Co 26,404 31.76
5 Intact Insurance Co 23,693 (4.01)
Source: Canadian Insurance Top Broker 2012 Annual Statistical Issue.
Fidelity Guarantee Insurance Written in 2011
Rank Company/Group Direct Premiums Written$,000 Earned Claims Ratio%
1 Chubb Ins Co of Canada 21,985 73.43
2 Lloyd’s Underwriters 13,343 37.01
3 The Guar Co of No America 16,433 28.02
4 Chartis Ins Co of Canada 13,272 (197.82)
5 Travelers Guar Co of Canada 11,100 20.50
Source: Canadian Insurance Top Broker 2012 Annual Statistical Issue.


Copyright 2012 Rogers Publishing Ltd. This article first appeared in the December 2012 edition of Canadian Insurance Top Broker magazine.