March 6, 2005 by Canadian Underwriter
B.C.’s public auto insurer is posting net income of $389 million for 2004, well above the $225 million reported in 2003.
The Insurance Corp. of B.C. (ICBC) reported written premiums up to $3.09 billion in 2004, up from $2.96 billion in 2003. Earned premiums rose to $3.03 billion from $2.85 billion over the same comparative period.
Claims costs rose slightly over the same period, to $2.50 billion from $2.49 billion, while operating expenses also jumped slightly to $104 million from $102 million.
Overall, ICBC was able to pull in an underwriting profit for 2004 of $97 million, compared to an underwriting loss of $17 million in 2003.
But investment income also saw a significant jump, hitting $395 million in 2004, compared to $330 million the year prior.
At the same time, the loss on non-insurance operations (i.e. the administration of licenses and fines on behalf of the province) widened slightly to $105 million last year compared to $102 million in 2003. And the company recorded $2 million in gains on the sale of property and equipment in 2004, versus a $14 million gain in 2003.
Overall, ICBC is celebrating the combination of investment income, premium growth and relatively low claims growth which produced 2004’s strong income. However, the ICBC release notes, "it is unlikely that all of these factors will recur in 2005", stressing income will be used to build retained earnings to absorb unexpected growth in claims costs or unusually low investment returns.