May 9, 2018 09:45
Just as Economical Insurance, the harsh winter has affected the financial results ofIntact financial Corporation during the first quarter of 2018. The insurer has seen a decline of 29 % in its net income, which amounted to 103 million dollars ($M), against$ 146m recorded in the same quarter of the previous year. The combined ratio also deteriorated to a point, up to 99,2 %.
The difficult winter conditions have caused an increase of approximately$ 40 Million in claims related to weather, «and this has especially had an impact on the areas of personal auto insurance and commercial insurance,» said Intact.
«The winter has been exceptionally hard everywhere in Canada, which has increased the frequency of claims in all sectors of activity,» says Charles Brindamour, president and chief executive officer. Despite a difficult start to the year, fundamentals in our sectors of property insurance and insurance business remain very good. «
Net loss from underwriting automobile
Motor insurance recorded a net loss from underwriting of$ 59 Million due to an increase in the frequency of claims, giving rise to a combined ratio of 106.4 % for the sector. Intact noted, however, that the inflation of the cost of the claims gives rise to price increases in all markets in personal auto, leading to an increase of 1.7 percentage point in the underlying performance.
Insurance of property of individuals, the insurer estimates that the favorable market conditions are expected to continue. Premiums increased by 2 %, which reflects an increase of rates in favourable market conditions. The combined ratio is 88.3 %.
20% increase in direct premiums written
Direct written premiums, however, increased 20 %, from $ 1.73 billion dollars (G$) in the first quarter of 2017 2.08 G$ for the period ended march 31, 2018. This increase reflects the acquisition of OneBeacon, which contributed 19 points.
The market of the insurance companies shows «obvious signs» of appreciation, » says Intact. In the United States, although prices are competitive currently, Intact says see signs of a trend rate to the increase varying between 1 % and 3 % in certain lines of specialty products.
«The measures to improve profitability in personal auto are progressing as planned and we remain committed to bringing down the combined ratio to around 95% by the end of 2018. We are also pleased with the progress achieved by our sector of specialty products in the United States which has posted a combined ratio of 95 %, » said Mr. Brindamour.