Co-operators General earnings up on underwriting gains

Guelph-based Co-operators General Insurance Co. (TSX: CCS.PR.A) has posted higher earnings for the third quarter and nine months ending September 30, 2004 as a result of improved underwriting.
The insurer netted income of $28.3 million ($1.34 per share) for the third quarter, more than double the income of $10.9 million ($0.48 per share) posted in the third quarter a year ago. Gross written premiums were down for the quarter, to $519.4 million from $528.2 million the year before. But net earned premiums were up over the same comparative period to $434.8 million from $408.8 million. The company was able to drag its loss ratio down to 67.2% in the third quarter of 2004 (Q3 2003: 74.3%), while improving its combined ratio to 96.9% (Q3 2003: 102.5%).
For the first nine months of 2004, the company produced net income of $100.7 million ($4.74 per share), almost triple the income of $30.3 million ($1.23 per share) produced in the first three quarters of 2003. Gross written premiums were up in the first nine months of 2004 to $1.49 billion from $1.45 billion the year prior, while net earned premiums grew to $1.28 billion from $1.15 billion over the same period. At the same time, the loss ratio dropped to 65.5% from 75.6%. And the combined ratio improved to 95.4% year-to-date in 2004, from 104.1% a year before.
Co-operators CEO Kathy Bardswick says the six consecutive quarters of improving results are encouraging. “This is quite an achievement considering the number of summer storms across Canada that impacted Co-operators General,” she notes of the most recent results. As various governments across Canada introduce automobile product reforms we have been able to introduce rate decreases for our customers and maintain a reasonable profit expectation for the company,” she adds.