Canadian Underwriter

Industrial Alliance reports net income of $4.2 million for Q4 2015

February 11, 2016   by Canadian Underwriter

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Quebec City-based Industrial Alliance Insurance and Financial Services Inc. has reported net income attributed to common shareholders of $4.2 million for the fourth quarter of last year, ending Dec. 31, 2015.

Net premiums for Q4 2015 were up to $1.670 billion from $1.346 billion in Q4 2014

Industrial Alliance (iA) offers auto and home insurance, as well as life and health insurance products, mutual and segregated funds, savings and retirement plans, RRSPs, securities, mortgages and car loans and other financial products and services for both individuals and groups. Net premiums for Q4 2015 were up to $1.670 billion from $1.346 billion in Q4 2014. For the full-year 2015, net premiums were $6.041 billion, compared to $5.426 billion for full-year 2014.

iA’s 2015 Management’s Discussion and Analysis (MD&A) for the year ending Dec. 31, 2015 noted that a record winter resulted in very high auto insurance claims in the first quarter of 2015. On the home insurance front, there was an exceptionally high number of serious fires in the fall. These events pushed the claims ratio up and brought the combined ratio for 2015 to 101.2%.

The MD&A said that the “highlight of 2015” was creating an auto and home insurance subsidiary under iA Auto and Home Insurance (iAAH) called Prysm General Insurance Inc, with the first policies underwritten in November. But given the startup costs for the new subsidiary and, to a lesser extent, the increase in claims, iAAH ended the year with a loss of $1.6 million – the first negative result for iAAH in more than 10 years.

“During 2015, we continued to strengthen our position as a diversified financial services group through internal growth, acquisitions and strategic partnerships,” concluded Yvon Charest, iA president and CEO in a statement. “One of the highlights in this regard was our retail insurance and segregated fund businesses, which both delivered outstanding growth. Equally important, we continued to invest in our distribution network with the acquisition of four insurance and wealth management brokerages to serve our retail clientele.”