Economical Insurance has announced that eligible policyholders have voted “overwhelmingly” in favour of the company’s demutualization.

Recently held via webcast, the third and final special meeting on demutualization saw 97% of eligible policyholders vote in favour of proceeding with the plan.

“Today’s tremendous support from eligible policyholders is an affirmation that we are on the right path for our company, policyholders, and community,” said Economical Insurance board chair John Bowey. “This is an important day in our 150-year history, as we are one significant step closer to completing the demutualization process, which will allow Economical to unlock our full potential as a strong, Canadian competitor in a rapidly changing industry.”

“Economical continues to build its capabilities and performance alongside established digital innovation,” added Economical Insurance president and CEO Rowan Saunders. “Today’s vote aligns well with the momentum we have been building for years to prepare ourselves for the future.”

In a company release, Economical said that a successful demutualization would result in demutualization benefits distributed to 630,000 eligible policyholders. It also said that it intends to raise cash for payment of the demutualization benefits in an initial public offering (IPO). The value of demutualization benefits would be based on the price of shares sold in the IPO.

In addition, $100 million of the proceeds of demutualization have been earmarked to fund a new charitable foundation.

“Economical was created 150 years ago in a small town that is now Kitchener, Ontario, with the idea of neighbour helping neighbour. That value still holds true for our company and will live on in the way we serve our customers and through the significant impact of the charitable foundation that this process will bring to life,” said Bowey.