iA's Net Income Up 25% in Q2

par Andrew Rickard | July 31 2015 01:05PM

Industrial Alliance has released its financial results for the second quarter of 2015. The company is reporting net income attributed to common shareholders of $142.2 million, an increase of 25% compared to the same period last year.

charest_yvon_articleiA's expected profit on in-force business was also up, increasing by 15% over the second quarter of 2014 to $132.5 million. Most of this gain was due to iA's retail insurance and wealth management business.

The company's individual insurance, individual wealth management, and group insurance divisions all reported experience gains for the period. iA notes that although there was a drop in the equity markets, individual insurance saw favourable mortality, morbidity, and policyholder experience for a total gain of $0.09 per share ($9.5 million). The individual wealth management division's hedging program helped to generate an experience gain of $0.08 per share ($8.2 million), while group insurance saw an experience gain of $0.01 per share ($1.1 million) which iA says was related to lower claims in the P&C business of its Dealers Services division.

In terms of business growth, premiums and deposits were up by 11% during the period to a total of $1.9 billion, mainly thanks to higher wealth management gross inflows in both the individual and group sectors. Although iA's total assets under administration declined by 2% to $112.9 billion because of poor stock market performance, they are still 7% higher when measured over the last twelve months.

Sales of the company's segregated funds were particularly strong for the quarter, up 25% to $366.5 million. In retail insurance, total sales increased by 11% to $61.7 million due to growth in minimum premiums in the United States, which were up by 30%, and in Canada, which increased by 6%. Sales of iA's adjustable disability product also grew by 13%.

"This quarter was without a doubt among our best on record," comments iA president and CEO Yvon Charest. "We are pleased to highlight the continued momentum in our retail insurance sales, as well as our seg fund business that continues to gain market share across Canada. Our balance sheet remains solid and we have significant capital to support our internal and external growth initiatives."

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