The acquisition of RSA prompted Intact Financial Corporation to revise its annual forecast for natural catastrophe losses.
Originally, Intact predicted that natural catastrophe claims would cost it $300 million by 2021. The acquisition of RSA boosted this estimate to $570 million.
“Our estimate reflects our view of longer-term trends, our growing premium base, concentration and management of risk, product mix and geographical mix,” Intact said in the financial report on its Q2 2021 its results.
In a conference call with financial analysts following the release of second-quarter results, Intact senior executives discussed the impact of claims since the start of 2021 in greater detail.
Patrick Barbeau, Executive Vice President and Chief Operating Officer, says the increase in the estimated amount provided to cover natural catastrophe damage is primarily due to the fact that RSA's portfolio in the U.K. mainly covers property. All the same, “Forecasted adds a bit more than its share from a volume perspective, but the books in Canada don't have a big difference. It's mostly proportional,” he says.
The impact of forest fires in British Columbia
In the second quarter of 2021, the insurer reported a combined ratio of 85 per cent for its Canadian operations. The forest fires in British Columbia that devastated the town of Lytton contributed to one percentage point in the ratio, CEO Charles Brindamour explains.
The CEO underlined the success of chatbots in claims processing: These applications currently handle about 90 per cent of digitally conversations with customers.
