Empire Life’s year-end financial results
Empire Life’s individual insurance product line results were $27.5 million in 2014 – a decrease of $38.9 million from 2013, announced the company on March 17. “The decrease in long-term interest rates in 2014 versus the increase experienced in 2013 was the main cause of these lower results,” stated the company.Empire Life’s individual insurance product line results were $27.5 million in 2014 – a decrease of $38.9 million from 2013, announced the company on March 17. “The decrease in long-term interest rates in 2014 versus the increase experienced in 2013 was the main cause of these lower results,” stated the company.Meanwhile, the wealth management product line results showed strength at $41.7 million, growth of $23.1 million from 2013. This increase was due “mainly to growth in segregated fund management fees and growth in segregated fund guarantee fees related to guaranteed minimum withdrawal benefit (GMWB) products. This improvement in fee income was primarily due to the positive impact of favourable stock market conditions, strong segregated fund product sales in 2014 and GMWB price increases,” said the company.
Empire Life’s overall shareholders’ net income was $98.7 million compared to $113.3 million the year before.
Below are more highlights from Empire Life’s year-end results announcement:
- Assets under management (including segregated fund and mutual fund assets) increased 14.2% over 2013 levels to reach $13.7 billion.
- Total premium revenue and fee income increased by 8.5% to reach $1.06 billion.
- Wealth management sales increased 32% and individual insurance sales increased 7% over 2013 levels. However, employee benefit sales weakened by 19% from 2013 levels.
- Shareholders' Capital and Surplus earnings of $22.4 million were up from $13.8 million in 2013, due mostly to gains on the sale of bonds.
- Participating policyholder net gain (after the payment of dividends) was $8.7 million compared to a $3.2 million loss in 2013. The improved result primarily relates to a reserve release from the annual assumption.
- Empire's Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio declined to 197% (December 31, 2014) from 231% (September 30, 2014) mainly due to low long-term interest rates and a comprehensive update of the methods and assumptions used in the company’s stochastic model for determining MCCSR required capital for segregated fund product guarantees.