When Confederation Life Insurance Co. was seized by regulators on August 11, 1994, it ranked as the fourth largest insurance company in Canada, and was among the top 30 in North America. With $19 billion (Cdn.) in assets, the company’s collapse wiped out 4,400 jobs, threw into disarray owners of 250,000 policies and contracts in Canada, plus another 800,000 outside the country.
It also severely damaged confidence in Canada’s substantial insurance industry.In a no-holds-barred account of the debâcle, financial journalist Rod McQueen documents how it all happened, and shows how Confederation Life’s failure was due to the combined failure of the company and the larger public sector. Directors did not hold management sufficiently accountable, officers let things get out of hand, regulators were tardy, then threatened with too small a stick, auditors missed the big picture, politicians showed neither courage nor conviction, and, rather than help, industry representatives dithered.
Any one individual among those six constituencies could have affected the course of the corporation’s history sufficiently to prevent its collapse.In 1994 McQueen wrote a detailed three-part article in the Financial Post about the Confederation Life scandal. Now, having extensively researched the history of the company, and having conducted over a hundred interviews, he has written a “whodunit” tale of Canada’s biggest business story of the decade.