The Co-operators General Insurance Co. announced Thursday its financial results for 2012, reporting net income of $257.7 million on direct written premiums of $2.1066 billion for the full year.
Last year, the Guelph, Ont.-based firm recorded net income of $150.3 million on direct written premiums of $2.05 billion.
"Improved results are primarily driven by policy and client growth which offset rate decreases in certain lines of business," The Co-operators stated in a press release, adding that for the full year, net earned premiums were up 4.7% year-over-year, from $1.925 billion in 2011 to $2.0164 billion in 2012.
"Net investment income and gains increased to $205.8 million from $157.1 million in 2011 as a result of the low interest rate environment and improvements in the equity markets," the company said. "Net claims and adjustment expenses have increased 2.7% from last year, which is mainly the result of increased incurred but not reported reserves and lower favourable claims development compared to 2011."
The increase in net income includes $35 million relating to a gain on the $150 million sale to RSA Canada of L'Union Canadienne, which closed last October. All figures for direct written premiums and net earned premiums exclude L'Union Canadienne.
The Co-operators reported direct written premiums for the fourth quarter were up year-over-year, from $504.7 million in 2011 to $518.7 million last year.
"This increase relates to higher average premium across certain product lines and more vehicles in force in Ontario and the West," the company said. "The combined ratio, excluding the market yield adjustment (MYA) for the quarter was 94.1%, which increased from 83.1% during the comparable period last year. Loss ratio deterioration is attributed to the combination of higher incurred but not reported reserves and lower favourable claims development compared to 2011."