EGI reports shrinking profits

EGI Financial Holdings Inc. reported a profit of Cdn$15 million for 2007, a decrease of 11.3% over 2006.
For 2007 Q4, the company reported a net income of Cdn$3.7 million, a decrease of 28.3% from 2006 Q4.
Underwriting income decreased 31.2% to Cdn$10 million for the year over 2006’s Cdn$14.5 million, an EGI release says.
For 2007 Q4, total underwriting income decreased 82.6% to Cdn$0.6 million.
“The primary reason for this result is the increase in the loss ratio in the quarter to 65.1% compared to 61.0% in 2006,” the statement says.
This increase, the company said, is due to the loss ratio for its niche products division climbing to 73.4% in the quarter, primarily due to losses in the emergency travel health line of business.
The combined ratio for 2007 Q4 increased to 98.2%, compared with 85.6% for the same period of 2006.
“While underwriting results in the Canadian property and casualty insurance industry continue to erode and trend down toward the industry’s historic norms, EGI will continue to aggressively pursue new business initiatives presenting significant growth opportunities and further diversification from the Ontario non-standard auto marketplace,” said Douglas McIntyre, the CEO of EGI Financial.