Intact Financial has released its earnings report for Q3 2017, noting that while it experienced a net income rise in the last quarter thanks to lower catastrophe losses, auto damage claims for the quarter were higher than anticipated.
The insurer said it had net income of $171 million ($1.25 per share) in the third quarter – an improvement from $125 million ($0.91 per share) in the same quarter the previous year.
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“Overall our results for the quarter were strong, driven by excellent performance in our personal property and commercial lines,” Intact CEO Charles Brindamour said in a statement.
Intact said it had an underwriting loss of $50 million in its auto division for the quarter, compared to a loss of $41 million last year. The company is expecting meaningful rate increases in all markets for the segment due to claims cost inflation.
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“Our personal auto results were disappointing,” commented Brindamour. “We took a more cautious reserve position following detailed file-by-file and actuarial reviews and we are increasing our actions to address higher than expected physical damage inflation. Our discipline in this line should bring the combined ratio to a mid-90’s level in the coming year.”
The company had also completed its acquisition of OneBeacon for $2.3 billion in the quarter, noting that the deal had very little impact on its earnings for the quarter.
“We are pleased to welcome OneBeacon to the Intact family, creating a leading North American specialty lines insurer,” said Brindamour. “Together we are working towards a low 90’s combined ratio for the US specialty business. We have exited underperforming lines, launched risk selection and claims initiatives and are moving fast to realize synergies. Growth initiatives are also underway, including the recent opening of cross border underwriting desks to serve our customers.”
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