iA’s net income skyrockets by 342 per cent

Visibility360, PDF version to share

By Aurélia Morvan | May 13, 2021, 9:30 a.m.

Denis Ricard

In step with Great-West Lifeco and Sun Life, iA reported stronger first quarter results compared with the same quarter last year.

iA Financial Corporation posted net income attributed to common shareholders of $172.9 million for the first quarter of 2021, versus $39.1 million for Q1 2020.

This sizable increase of 342.2 per cent or $133.8 million can be explained by several factors, including:

An expected profit on inforce in Q1 2021 that was 10 per cent or $18.5 million higher than Q1 2020. “This growth is mainly explained by the addition of expected profit from the IAS acquisition in the US Operations sector and by good expected growth in the Individual Insurance sector.
A net experience gain of $6.2 million in Q1 2021, versus a net experience loss of $142.9 million in the first quarter of 2020.
New business had a negative impact of $4.7 million in the first quarter of 2021, compared with $10.5 million in the first quarter of 2020.

One segment retreats, four advance

Looking at the results in closer detail, only one segment declined: Group Savings and Retirement reported net income of $7.7 million, down 3.8 percent or $300,000 from the first quarter of 2020.

The other four segments prospered:

Individual Insurance reported net income of $81.1 million, versus $34.8 million in the first quarter of 2020, up 133 per cent or $46.3 million.
Individual Wealth Management posted net income of $50.5 million, versus a net loss of $24.2 million in the first quarter of 2020, up $74.7 million.
Group Insurance: Net income of $13.5 million, up 87.5 per cent or $6.3 million from $7.2 million in Q1 2020.
U.S. Operations: Net income of $20.1 million, up 51.1 per cent or $6.8 million from $13.3 million in Q1 2020.

iA Insurance also gained ground

iA Insurance reported net income attributed to iA Financial Corporation, its sole common shareholder, of $171 million in Q1 2021. Its net income was $40.6 million in Q1 2020, “a quarter marked by the onset of the COVID-19 pandemic and major market fluctuations.”

This result is up 321.2 per cent or $130.4 million.

Premiums and deposits: Only one sector declines

iA reported premiums and deposits of $4.4 billion for the first quarter of 2021, $3.5 billion higher than in Q1 2020. The increase amounts to 24.7 per cent or $876.4 million.

Looking at the results in closer detail, premiums and deposits fell in only one sector:

Group Insurance declined by 6.8 per cent or $31.6 million versus Q1 2020, to $429.7 million.

Premiums and deposits increased in all other sectors:

Individual Insurance rose by 5.3 per cent or $21.2 million to $418.7 million.
Individual Wealth Management grew by 43.8 per cent or $776.5 million, to $2.5 billion.
Group Savings and Retirement was up 5.3 per cent or $34.8 million, to $686.8 million.
U.S. Operations increased by 37.7 per cent or $67.5 million, to $246.4 million.
General insurance rose by 9.5 per cent or $8 million to $92.5 million.

Sales increase across the board

iA Financial Corporation saw sales advance in all sectors:

Individual Insurance increased by 28.5 per cent or $12.9 million, to $58.1 million.
Individual Wealth Management climbed 43.8 per cent or $776.5 million, to $2.5 billion.
Group Insurance grew by 2.3 per cent or $8.1 million, to $365.1 million.
Group Savings and Retirement increased by 5.2 per cent or $34.4 million, to $693.3 million.
U.S. Operations rose by 70 per cent or $137.7 million, to $334.5 million.
General insurance was up 13.8 per cent or $10.2 million, to $84.1 million.

“All our business lines performed well, delivering strong sales and earnings. Sales were particularly good in individual insurance, where they were up 29% year over year, and in individual wealth management, which saw record sales of segregated funds and mutual funds,” says Denis Ricard, President and CEO of iA Financial Group.

“Also of note is the good performance of our dealer services operations in Canada as well as in the US, where we are just beginning to reap the benefits of the IAS acquisition,” he adds.

Manulife, Great-West Lifeco, Sun Life, Empire Life, The Co-operators and Northbridge also released their financial results for the first quarter of 2021.