EGI witnesses improved results in Q1 2012

EGI Financial Holdings Inc.’s net income for Q1 2012 rose 25% over the same period in 2011, largely in response to the numbers of written premiums and investment income.

The company witnessed a 42% increase in written premiums in Q1 2012 compared with Q1 2011, rising to 43,939 from 30,850. The numbers translated to a 4.5% increase in net earned premiums from 40,344 in Q1 2011 to 42,170 in Q1 2012.

There was significant growth in written premiums in EGI’s start-up U.S. division (the division was negatively impacted by storms in Texas) and the company’s new international division commenced writing premiums (the business is similar in nature to that written by the niche products division in Canada).

Comparing first quarters for 2012 and 2011, investment income rose to $6.0 million from $4.4 million, and net operating income of $1.7 million ($0.14 per share) compared to $2.2 million ($0.18 per share).

The combined operating ratio was 96% in Canada and 102% for the entire company. “The company’s Canadian businesses recorded underwriting profitability, which was offset by start-up costs in the U.S. and in the new International division,” EGI reports.

“In the first quarter, we produced a 41% increase in underwriting profit in our Canadian operations, which accounts for more than 90% of our business,” Steve Dobronyi, chief executive officer of EGI, says in a company press release.

“We were especially satisfied with the strong growth in profitability in our niche products division due to improved claims performance, a reflection of our renewed focus on underwriting discipline in these programs,” Dobronyi said.

That increase was primarily due to an improvement in claims experience, most notably in commercial property, liability and errors and omissions insurance.