Desjardins Group says housing insurance props up auto insurance results

Desjardins Group announced Cdn$273 million in surplus earnings for 2007 Q4, compared to Cdn$284 million for the same quarter in 2006.
Desjardins General Insurance Group (DGIG) contributed Cdn$8 million to the company’s 2007 Q4 results, compared to Cdn$18.8 million for the previous year.
“This decrease [in the insurance segment results] is explained by lower underwriting profits due to less favourable claim experience in automobile insurance, which however, was partially offset by improved claim experience in housing insurance since no major event was recorded in this area during the quarter,” Desjardins announced in a press release.
Return on equity was 7.4% in 2007, against 17.4% a year earlier.
Overall in 2007, DGIG contributed Cdn$126.2 million to the company’s final tally, as opposed to Cdn$106.6 million for 2006.
Return on equity rose to 26.7% in 2007 from 25.2% for the previous year.
“The insurance results are a big part of this enviable performance,” the company announced. “In fact, favourable claim experience in housing insurance more than offset the increase in operating expenses stemming from major investments made to boost the company’s competitive edge.
“The auto insurance segment fared well despite a slight deterioration in claim experience due to lower rates and higher claim costs.”
Gross premiums written rose to Cdn$1.43 billion over the $1.41 billion recorded in 2006, the company said, “despite lower auto insurance rates, particularly in Qubec.”