iA Financial Group shares were once again hit hard following the release of its latest financial results. According to its President and CEO, Denis Ricard, the situation amounts to an unpleasant “hiccup.”
Investors had reacted just as coldly after the release of the company’s results for the final quarter of 2025 last February. At the time, the stock, which had been trading above $170 per share, fell below $150 the day after the results were released before recovering in the following weeks.
On May 5, 2026, on the eve of the latest results release, the stock was trading at $176. After the results were published, the share price dropped to $159.21, a decline of 10 per cent, before climbing back to $170.90 by the end of the trading day on May 14.
In the May 10 edition of La Presse+ in its Investisseurs avisés (savvy investors) column, it was reported that CEO Denis Ricard, along with Executive Vice-President, CFO and Chief Actuary Éric Jobin, had purchased 2,000 and 1,000 company shares respectively.
The Montreal daily also noted that Mario Mendonca, an analyst with TD Securities, had withdrawn his buy recommendation on iA Financial Group stock following the publication of quarterly results for the quarter ended March 31, 2026.
The company had just reported earnings per share of $3.25 for the quarter, close to analysts’ consensus expectations, but below Mendonca’s forecast, according to La Presse+.
U.S. operations
Insurance Portal reviewed the transcript of the conference call with financial analysts held on May 7 to better understand the financial markets’ negative reaction. During the call, several questions focused on the company’s U.S. operations, where profitability was lower than in the same quarter of 2025.
In its management discussion and analysis for the first quarter of 2026, the company commented on the division’s results as follows: “Core insurance experience unfavourable ($9 million before taxes), mainly due to unfavourable policyholder behaviour in individual insurance.”
While presenting the results to analysts, Éric Jobin indicated that the reasons behind the $9 million loss “are contained and non-recurring.”
According to the management report, individual insurance sales reached US$79 million in the first quarter of 2026, compared with US$68 million in 2025, an increase of 16 per cent over the same period the previous year. This result was “driven by growth in the final expense and middle market segments, supported by solid distribution relationships,” the company stated.
In individual insurance within the company’s U.S. operations, net premiums, premium equivalents and deposits totalled $268 million in the last quarter, up 5 per cent from the $255 million reported in 2025. In dealer services, net premiums declined by 15 per cent over 12 months. iA spokesperson Chantal Corbeil said in an email that this business unit achieved year-over-year growth of 34 per cent.
During the conference call with analysts, Chief Growth Officer, U.S. Operations Sean O’Brien explained that the unfavourable experience in individual insurance was related to the lapse experience, meaning the interval between policy issuance and cancellation.
“We’ve had exponential growth at American Amicable. As part of that growth late last year, we identified a small group of contained new agents with an inordinately high lapse rate. We quickly removed those agents,” he explained.
“We’re now working with with the IMO partners to update our products and training to help reduce that risk. It was not a systemic issue. We contained it pretty quickly and (are) very confident still with our targets for American Amicable on profit and sales,” O’Brien added, congratulating his team for quickly identifying and resolving the issue.
He later specified that the independent marketing organization (IMO) linked to the matter accounted for less than 5 per cent of U.S. individual insurance sales. It was a “small contained group within one IMO,” O’Brien noted.
Analyst Mario Mendonca asked for further clarification on the issue, asking whether it involved some form of “fraudulent policies” that raised compliance concerns.
Denis Ricard replied: “I would not use the term ‘fraud,’ but I would certainly use the term ‘malpratice’ in terms of some distributors. We have increased the vigilance of the IMO’s and the underlying representative under this IMO. We are looking at all our processes to make sure that we can avoid that in the future.”
Questioned further by the analyst, Ricard assured listeners that there was no risk related to the company’s legal liability stemming from the issue at American Amicable. The subsidiary derives a significant portion of its revenue from final expense insurance sales.
Discussion with another analyst
On May 12, while in Austin meeting with American partners, Denis Ricard took part in a webinar with analyst Tom MacKinnon of BMO Capital Markets. The link provided to investors was shared with Insurance Portal. During the webinar, the discussion again turned to the situation at American Amicable.
Denis Ricard acknowledged that the expression “malpractice,” which he used during the conference call with analysts, was not appropriate under the circumstances. According to him, the intermediary had simply recruited too many inexperienced agents. “It’s more the fact that the profile of the distribution was not as experienced as it should have been,” he underlined.
Ricard also took the opportunity to remind listeners that the company had acquired American Amicable in 2010 and that the profile of distribution agents had remained fairly stable throughout that period. After 15 years, “Il would qualify this as a hiccup along the history of this acquisition,” Ricard added. According to him, the subsidiary delivers a 20 per cent return on equity.
At the end of the interview, he commented on the decline in the company’s share price following the release of quarterly results: “If the stock goes down, it’s time to buy. That’s exactly what I did,” he said.
According to Ricard, the company’s business model has demonstrated its strength over the past 25 years. The company has achieved annual average returns 3.5 per cent higher than its industry peers. “To achieve that over such a long period, you have to be different, and that’s what we are. We do things differently—it’s in our DNA,” he continued.
More intensive share buyback
On May 5, the company confirmed that it was amending its normal course issuer bid (NCIB), which remains in effect until November 13, 2026. Instead of the 5 per cent of outstanding common shares originally planned when the program was launched in November 2025, the NCIB will now target 8 per cent of shares.
Between November 14, 2025, and April 30, 2026, the approximately 2.7 million shares already acquired were purchased at a weighted average price of $162.62.
During the conference call with analysts on May 6, Denis Ricard explained that the company’s capital deployment strategy follows four priorities, listed in order of importance: 1) organic growth, 2) growth-enhancing acquisitions, 3) shareholder dividends and 4) share buybacks.
“We don’t want to pile up capital. But we are generating so much these days that, when you look at the actual NCIB, because there are no acquisitions right now, and we don’t want to pile up, it’s kind of the last point in the equation that you have to use. It’s not my preferred choice, but I think it’s a great way to return some value to the shareholders until we find an acquisition.”
In its quarterly highlights, the company also noted that it generated $155 million in excess capital, compared with $125 million during the same period in 2025, and that it still aims to reach the $700 million target set for 2026.
