Empire Life saw its profits decline in 2022. The insurance company reported net income attributable to shareholders of $204 million for fiscal 2022.
For the year 2021, net income was $239 million, representing a downturn of 15 per cent or $35 million. The company published its financial results on March 2.
In its press release issued on February 23, Empire Life attributes the decline “to the non-recurring release of segregated fund guarantee related policy liabilities which occurred in the first quarter of 2021.”
For the fourth quarter of 2022, net income attributable to shareholders was $87 million, compared with only $17 million in the same quarter of 2021.
The insurer explains this increase by “the effect of assumption updates applied in the Individual Insurance line which had a favourable impact on fourth quarter earnings in 2022 compared to an unfavourable impact in 2021.”
Net premiums exceeded $1 billion, compared with $916 million in 2021. This represents an increase of $127 million or 15 per cent.
Looking at the results in by segment:
- In Group Solutions, net premiums were $452 million in 2022, up $45 million or 11 per cent over 2021;
- In Individual Insurance, net premiums were $451 million in 2022, up $17 million or 4 per cent over 2021;
- In Wealth Management, net premiums were $140 million, equal to growth of 87 per cent or $65 million over 2021.
Benefits and claims
Empire Life reported total net benefit payments and settlements of $673 million compared to $630 million in 2021. This amounts to an increase of $43 million or 7 per cent over the prior year.
In its Management Discussion and Analysis (MD&A), the company attributes the increase in net benefits and claims to the Individual Insurance and Group Solutions sectors. The figures tell the same story.
In Wealth Management, benefit and claims decreased 13 per cent from 2021 to $149 million, a difference of $22 million.
In Group Solutions, benefits and claims grew by $43 million or 15 per cent in one year, while in Individual Insurance, these expenses climbed $23 million or 14 per cent in 2022 compared to 2021.
Empire Life reported investment income of $358 million in 2022, an increase of $28 million or 8 per cent from $330 million in 2021.
“Despite ongoing economic challenges and rising inflation, we had another successful year,” said Mark Sylvia, President and Chief Executive Officer of Empire Life. “We continue to invest in innovation to continuously improve our products and processes.”