February 29, 2016 by Canadian Underwriter
Home, car and business insurer RSA Canada has reported a record underwriting profit of $225 million for 2015 and a combined operating ratio of 91.7%, well below its annual target for 2015. In 2014, the combined operating ratio was 98.6%.
For the full year 2015, net written premiums were down 4% to US$2.651 billion, RSA Canada said in a press release on Monday.
“We’ve reached a momentous milestone as RSA Group completed its turnaround phase, and Canada delivered its best financial results in our history,” said Rowan Saunders, president and CEO of RSA Canada, in the release. “These results were accomplished during a very challenging year given ongoing competitive market conditions and unprecedented change as we embarked on the first year of an ambitious goal to be Canada’s best-in-class insurer for our customers and shareholders.”
A priority focus on managing expenses and improving pricing capabilities, along with favourable weather conditions, all contributed to strong results, RSA Canada said.
Saunders told Canadian Underwriter that RSA Canada focused the past few years on targeted underwriting and risk selection. “We have worked hard to take actions that help our customers mitigate against losses, and price risk appropriately. In 2015 we experienced a benign year from a weather perspective, resulting in favorable loss conditions across all of our portfolios. Specifically, property results have benefited from a lack of significant weather events. These actions and factors have contributed to the profitable book of business that produced the 2015 full year results.”
In addition, “RSA has worked hard over the last few years to ensure we are improving our ability to serve our customers at a high quality with a lower cost to ensure we can provide competitive prices to the market,” Saunders said. One of the areas the company has looked at is how to optimize its real estate footprint to reduce costs for our consumers. “We have tightened up on discretionary spend and made our processes more efficient,” he said.
RSA’s process improvements were recognized by brokers, with satisfaction rates remaining strong throughout the transformation work, RSA Canada reported. In Personal Insurance, for example, 90% of brokers surveyed in Ontario, Atlantic and Alberta reported that service was better or the same.
“Our transformation so far helps propel our plans for growth,” said Saunders in the release. “We have an unwavering commitment to delivering for the broker channel and we plan to double down on our broker investments. We’ve made it faster and better to do business with us on such things as quicker response times, eliminating silos, and increasing front-line decision making authority. Our focus going forward is on expansion and growing with brokers for the future.”
P&C insurer RSA Canada has been operating in Canada since 1845, and offers marine, travel and equipment breakdown insurance. The company is part of RSA Insurance Group Plc, headquartered in London, United Kingdom, which offers insurance services in over 140 countries. The RSA Canada group of companies includes Roins Financial Services Limited, Royal & Sun Alliance Insurance Company of Canada, Quebec Assurance Company, Johnson Inc., Unifund Assurance Company, Western Assurance Company, Ascentus Insurance Ltd., Canadian Northern Shield Insurance Company and RSA Travel Insurance Inc. (collectively, RSA Canada).