Intact Financial reports strong growth in underwriting income
Intact Financial says COVID-19 is expected to impact direct premiums written growth in the mid-single to low-double digit range for the rest of this year, while underwriting performance is expected to remain on track.
In releasing its second quarter results, Intact reported net operating income increased 65 per cent to $350 million or $2.35 a share, reflecting strong growth in underwriting income.
"We delivered solid results this quarter while providing relief to more than one million customers and helping our Alberta customers get back on track following two significant weather events,” said Charles Brindamour, Intact’s CEO.
Capital position strong
“Our capital position remains strong and we are well positioned to meet our underwriting targets for 2020. The COVID-19 crisis has exacerbated many underlying societal challenges, from poverty to racism, to the care of our most vulnerable people. Businesses and their employees have an important role to play in solving these problems and we intend to do our part to contribute to meaningful change."
The company said hard market conditions in personal auto will be tempered until driving activity returns to a normal level, while hard market conditions in personal property are expected to continue. In commercial lines hard market conditions are expected to resume in the coming months. Hardening market conditions are expected to continue in the U.S. commercial area.
Corrective measures to resume
The company said it expects industry corrective measures to resume as the impacts from COVID-19 decline.
Personal auto premium growth was up three per cent in the quarter, while personal property premiums increased 11 per cent. Commercial lines premium grew 7 per cent, tempered by the impact of the economic slowdown and premium relief measures.
Personal property premiums increased 11 per cent and net investment income of $141 million for the quarter decreased five per cent compared to last year, mainly due to lower reinvestment yields and lower dividend income related to reductions and timing.