Insurer reports strong third quarter

A 38.8 per cent third-quarter increase over last year would have any insurer smiling.

Insurance News

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A 38.8 per cent third-quarter increase over last year would have any insurer smiling.

Desjardins General Insurance Group (DGIG) recorded a net income of $63 million for the quarter ending September 30, up 38.8 per cent from the corresponding period in 2013.

“We had a very strong quarter, both in terms of growth and profitability,” said Sylvie Paquette, DGIG's President and COO. “Even though we are investing a lot of resources and energy to prepare for the addition of State Farm's Canadian operations, our existing operations remain right on track. Our efforts in improving client experience resulted in three JD Power customer satisfaction awards won by our companies this year.

“At the same time, I am particularly pleased by the organic growth we've achieved in such a soft market,” added Paquette.

The combined ratio (excluding market yield adjustment) for the quarter fell to 85.2 per cent, a drop of 10.4 percentage points. DGIG attributes this was largely due to more favourable weather conditions compared to the third quarter in 2013.

Direct written premiums increased 5.8 per cent to $581.9 million, the result of multiple growth initiatives across all market segments and regions.

Paquette said the preparatory work for the addition of State Farm's Canadian operations is also on track.

“When the deal closes next January 1, DGIG will become the second largest P&C insurance provider in Canada,” she said, “with approximately $4 billion in premium volume.”

Year-to-Date Results
For the first nine months of the year, net income was $129.2 million, up 13.9 per cent from the same period in 2013. The ROE for the first nine months was 14.6 per cent, compared to 15.2 per cent in 2013.

DGIG attributes that this decrease was largely due to the transaction and integration costs incurred as part of the acquisition of State Farm's Canadian operations.

Direct written premiums increased by 5.7 per cent to $1,709.5 million, while the number of policies-in-force grew by almost 88,000 to 2,257,000 since the beginning of the year.

 

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